UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment
(Amendment No. )
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REINSURANCE GROUP OF AMERICA, INCORPORATED
(Name
(Name of Registrant as Specified in Its Charter)
(Name
(Name of PersonPerson(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
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REINSURANCE
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[RGA LOGO] GROUP OF AMERICA,
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INCORPORATED(SM)
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NOTICE OF THE ANNUAL MEETING OF
THE SHAREHOLDERS OF
REINSURANCE GROUP OF AMERICA, INCORPORATED
Chesterfield, Missouri
April 11, 2007
TO THE SHAREHOLDERS OF
REINSURANCE GROUP OF AMERICA, INCORPORATED
The Annual Meeting of | (1) | | Amount Previously Paid: |
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| (2) | | Form, Schedule or Registration Statement No.: |
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| (3) | | Filing Party: |
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| (4) | | Date Filed: |
PRELIMINARY COPY
October [ ], 2008
To the Shareholders of Reinsurance Group of America, Incorporated:
You are cordially invited to the special meeting of the shareholders of Reinsurance Group of America, Incorporated, a Missouri corporation, which will be held at the Company's officesCompany’s corporate headquarters at 1370 Timberlake Manor Parkway, Chesterfield, Missouri 63017, on November 25, 2008 at 11:00 a.m. local time.
This booklet includes a formal notice of the special meeting and the proxy statement. At the special meeting, our shareholders will be asked to consider:
1. Conversion Proposal. A proposal (the “conversion proposal”) to convert the Company’s dual class common stock structure into a single class common stock structure (the “conversion”). Pursuant to the conversion, our class B common stock would convert into our class A common stock on a one-for-one basis (with such class A common stock being automatically redesignated as “common stock”);
2. Charter Proposal. A proposal (the “charter proposal”), subject to and conditioned upon approval of the conversion proposal, to amend and restate our Amended and Restated Articles of Incorporation (the “charter amendment”) to eliminate provisions relating to our class B common stock and our dual class common stock structure; and
3. Adjournment Proposal. A proposal to adjourn the special meeting if necessary or appropriate to permit further solicitation of proxies if there are not sufficient votes at the time of the special meeting to approve the foregoing proposals.
Our board of directors has approved these proposals and recommends that you vote for their approval. Your participation and vote are important. The conversion will not be effected without the affirmative vote of holders of a majority of both classes of our common stock represented in person or by proxy and entitled to vote at the special meeting. The charter amendment will not be effected without the affirmative vote of holders of a majority of the outstanding shares of both classes of our common stock.
Your vote is important. Even if you plan to attend the special meeting in person, please complete, sign, date and promptly return the enclosed proxy card in the enclosed postage-prepaid envelope. This will not limit your right to attend or vote at the special meeting.
The accompanying proxy statement provides detailed information about the proposed conversion. Our board of directors encourages you to read the entire document and the appendixcarefully. You may also obtain more information about the Company from documents the Company has filed with the Securities and Exchange Commission.
Thank you for your continued support.
REINSURANCE GROUP OF AMERICA, INCORPORATED
Sincerely,
A. Greig Woodring
President and Chief Executive Officer
REINSURANCE GROUP OF AMERICA, INCORPORATED
1370 Timberlake Manor Parkway
Chesterfield, Missouri 63017
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
To Be Held November 25, 2008
A special meeting of the shareholders of Reinsurance Group of America, Incorporated, a Missouri corporation, will be held at the Company’s headquarters at 1370 Timberlake Manor Parkway, Chesterfield, Missouri 63017 on November 25, 2008 at 11:00 a.m. local time for the following purposes:
1. Conversion Proposal. To consider and vote upon a proposal to convert the Company’s dual class common stock structure into a single class common stock structure (the “conversion”). Pursuant to the conversion, our class B common stock, par value $0.01 per share, will be converted into our class A common stock, par value $0.01 per share, on a one-for-one basis (with such class A common stock being automatically redesignated as “common stock”).
2. Charter Proposal. To consider and vote upon a proposal, subject to and conditioned upon approval of the conversion, to amend and restated our Amended and Restated Articles of Incorporation (the “charter amendment”) to eliminate provisions relating to our class B common stock and our dual class common stock structure.
3. Adjournment Proposal. To adjourn the special meeting if necessary or appropriate to permit further solicitation of proxies if there are not sufficient votes at the time of the special meeting to approve the foregoing proposals.
4. Other Business. To transact such other business as may properly brought before the special meeting or any adjournment or postponement thereof.
The Company’s shareholders of record at the close of business on October 17, 2008 are entitled to notice of, and to vote at, the special meeting and any adjournment or postponement of the special meeting. A complete list of shareholders entitled to vote at the special meeting will be available for 10 days prior to the special meeting during ordinary business hours at the Company’s headquarters located at 1370 Timberlake Manor Parkway, Chesterfield, Missouri on May 23, 2007, commencing at 2:00 p.m.,
at which meeting only holders of record of the Company's common stock at the
close of business on March 23, 2007 will be entitled to vote, for the following
purposes:
1. To elect three directors for terms expiring in 2010;
2. To approve an amendment to the Company's Flexible Stock Plan;
3. To authorize the sale of certain types of securities from time to
time to MetLife, Inc., the beneficial owner of a majority of the
Company's common shares, or affiliates of MetLife, Inc.; and
4. To transact such other business as may properly come before the
meeting.
REINSURANCE GROUP OF AMERICA,
INCORPORATED
63017.
By /s/ Steven A. Kandarian
Steven A. Kandarian
Chairmanorder of the Board /s/ James E. Sherman
of Directors of
Reinsurance Group of America, Incorporated
James E. Sherman, Secretary
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October [ ], 2008
Whether or not you plan to attend the special meeting, please complete, date and sign the enclosed proxy and mail it promptly in the enclosed stamped envelope.
TABLE OF CONTENTS
PAGE NO.
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Notice of the Annual Meeting of Shareholders ................................... i
Information | | | | |
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Corporate Governance ...................................................... 4
Board of Directors and Committees ......................................... 6
Compensation Discussion and Analysis ...................................... 7
Compensation Committee Report ............................................. 16
Summary Compensation Table ................................................ 16
Grants of Plan-Based Awards in 2006 ....................................... 17
Outstanding Equity Awards at 2006 Fiscal Year-End ......................... 19
Option Exercises and Stock Vested During Fiscal 2006 ...................... 22
Pension Benefits in Fiscal 2006 ........................................... 23
Nonqualified Deferred Compensation in Fiscal 2006 ......................... 24
Potential Payments Upon Termination or Change of Control .................. 25
Director Compensation for Fiscal 2006 ..................................... 26
Securities | |
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INFORMATION ABOUT THE 2007 ANNUAL MEETING AND PROXY VOTING
EVEN THOUGH YOU MAY PLAN TO ATTEND THE MEETING IN PERSON, PLEASE MARK,
DATE, AND EXECUTE THE ENCLOSED PROXY AND MAIL IT PROMPTLY. A POSTAGE-PAID RETURN
ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE.
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REINSURANCE
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[RGA LOGO] GROUP OF AMERICA,
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INCORPORATED(SM)
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APPENDIX A: Amended and Restated Articles of Incorporation (marked to reflect all changes to be made to the Company’s existing Amended and Restated Articles of Incorporation)
1370 TIMBERLAKE MANOR PARKWAY, CHESTERFIELD, MISSOURI 63017-6039
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Timberlake Manor Parkway
Chesterfield, Missouri 63017
PROXY STATEMENT
FOR THE
ANNUAL MEETING OF THE SHAREHOLDERS
TO BE HELD MAY 23, 2007
AT RGA'S OFFICES IN CHESTERFIELD, MISSOURI
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This
The accompanying proxy, mailed together with this proxy statement, is furnished tobeing solicited by and on behalf of the holdersboard of common stockdirectors of Reinsurance Group of America, Incorporated, (the "Company"a Missouri corporation, or "RGA") in
connection with the solicitation of proxies“Company,” for use at a special meeting of our shareholders and at any adjournment or postponement thereof. References in connection withthis proxy statement to “we,” “us,” “our” or like terms also refer to the Annual MeetingCompany. This proxy statement and accompanying proxy were first mailed to our shareholders on or about October [ ], 2008.
Date, Time and Place of the Shareholders toSpecial Meeting
The special meeting of our shareholders will be held at 2:the Company’s headquarters at 1370 Timberlake Manor Parkway, Chesterfield, Missouri 63017 on November 25, 2008 at 11:00 p.m. May 23, 2007, and all
adjournments and postponements thereof, for the purposes set forth in the
accompanying Notice of Annual Meetinga.m. local time.
Purpose of the Shareholders. Such holders are
hereinafter referredSpecial Meeting and Recommendation of our Board of Directors
At the meeting, shareholders will consider and act upon a proposal (which we refer to as the "Shareholders."“conversion proposal”) to convert the Company’s dual class common stock structure into a single class common stock structure (which we refer to as the “conversion”). Pursuant to the conversion, our class B common stock, par value $0.01 per share (which we refer to as the “class B common stock”), will be converted into our class A common stock, par value $0.01 per share (which we refer to as the “class A common stock”), on a one-for-one basis. Following the conversion, subject to the rights of the holders of any of our preferred stock, the holders of the single class of common stock, voting as a class, shall be entitled to elect all members of our board of directors. If authorization is received from the New York Stock Exchange (which we refer to as the “NYSE”), our new common stock will be listed on the NYSE and assigned the ticker symbol “RGA”. We plan to request a symbol change for our class A common stock from “RGA.A” to “RGA” and plan to request our class B common stock to be delisted from the NYSE after the effective date. Furthermore, we expect our new common stock will retain and use the CUSIP security identification number presently assigned to our class A common stock.
At the meeting, shareholders will also consider and act upon a proposal (which we refer to as the “charter proposal”) to amend and restate our Amended and Restated Articles of Incorporation (the “charter amendment”) to eliminate provisions relating to our class B common stock and our dual class common stock structure. The Companycharter proposal is first mailing this
proxy statementsubject to and conditioned upon approval of the conversion proposal.
Our board of directors recommends that you vote “for” both the conversion proposal and the enclosed formcharter proposal.
Our board of proxy to Shareholders on or about April
11, 2007.
Whether ordirectors does not you expectknow of any matters to be present in personacted upon at the meeting you are
requestedother than the conversion proposal and the charter proposal.
Important Notice Regarding the Availability of Proxy Materials for the Shareholders Meeting to complete, sign, date, and return the enclosed form of proxy. If you
attend the meeting, you may vote by ballot. If you do not attend the meeting,
your shares of common stock can be voted only when represented by a properly
executed proxy.
Any person giving such aBe Held on November 25, 2008: This proxy has the right to revoke itstatement is available at any time
before it is voted by giving written notice of revocation to the Secretary of
the Company, by duly executing and delivering a proxy bearing a later date, or
by attending the Annual Meeting and voting in person.
www.rgare.com.
ABOUT THE MEETING
Who Can Vote
The close of business on March 23, 2007 has been fixed as the record date for the determination of holders of our class A common stock and our class B common stock entitled to notice of and to vote at the Shareholdersspecial meeting, or any adjournment or postponement thereof, is the close of business on October 17, 2008 (which we refer to as the “record date”). As of the record date, there were [ ] shares of class A common stock issued and outstanding and entitled to vote at the Annual Meetingmeeting, and [ ] shares of class B common stock issued and outstanding and entitled to vote at the Shareholders. Asmeeting.
The holders of record of our class A common stock and our class B common stock as of the record date approximately [__________] shares of
common stock were outstanding and entitled to be voted at such meeting, with
approximately [__] holders of record. Shareholders will be entitled to cast one vote per share on each matter for each share of common stock held of record onupon which they are being asked to vote at the record
date.
A copyspecial meeting, or any adjournment or postponement thereof.
How Proxies Will be Voted
Shares represented by valid proxies received by telephone, over the Internet or by mail will be voted at the meeting in accordance with the directions given. If the enclosed proxy card is signed and returned without any direction given, the shares will be voted “for” the three proposals.
If a broker holds your shares in “street name,” the broker is required to vote those shares in accordance with your instructions. If you do not give instructions to the broker, under the rules of the
Company's Annual ReportNYSE, the broker is not allowed to
Shareholders for the fiscal year
ended December 31, 2006 accompanies this proxy statement.
The Board of Directors of the Company makes this proxy solicitation. The
solicitation will primarily be by mail and the expense thereof will be paid by
the Company. In addition, proxies may be solicited by telephone or telefax by
directors, officers, or regular employees of the Company.
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ITEM 1 - ELECTION OF DIRECTORS
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The first item to be acted upon at the Annual Meeting is the election of
three directors of the Company for terms expiring at the Annual Meeting in 2010,
or until their respective successors have been elected and have qualified.
Proxies cannot be voted for a greater number of persons than the number of
nominees named.
NOMINEES AND CONTINUING DIRECTORS
The Board of Directors is divided into three classes, each of which
generally contains either two or three directors, with the terms of office of
each class ending in successive years. Lisa M. Weber resigned from the Board on
January 25, 2006. In anticipation of Ms. Weber's departure from the Board, the
management of MetLife, Inc. ("MetLife"), the Company's principal shareholder,
suggested Georgette A. Piligian as a director candidate to fill the vacancy
created by Ms. Weber's resignation. Following consideration by the Nominating
and Corporate Governance Committee, on January 26, 2006, the Board elected Ms.
Piligian to fill the vacancy. Leland C. Launer, Jr. resigned from his position
at MetLife, and as chairman of the Company's Board, on January 18, 2007.
Following Mr. Launer's resignation, the management of MetLife suggested Steven
A. Kandarian as a candidate to fill the vacancy created by Mr. Launer's
resignation. Following consideration by the Nominating and Corporate Governance
Committee, on January 25, 2007, the Board elected Mr. Kandarian a director and
chairman of the Board.
Currently, the Board has eight directors, with two vacancies. Certain
informationvote your shares with respect to either of the nominees for electionproposals. Our board of directors does not intend to present, and has no information indicating that others will present, any business at the special meeting other than as directors proposed by
the Company and the other directors whose terms of office as directors will
continue after the Annual Meeting is set forth below. Eachin the attached Notice of Special Meeting of Shareholders. If any other matters properly come before the directors has
served in his or her principal occupation for the last five fiscal years, unless
otherwise indicated.
Should any one or more of the nominees be unable or for good cause is
unwilling to serve (which is not expected),meeting, the proxies (except proxies marked
to the contrary)solicited hereby will be voted foron such othermatters in accordance with the judgment of the persons voting such proxies.
How to Revoke Your Proxy
You have the unconditional right to revoke your proxy at any time prior to the voting thereof by submitting a later-dated proxy, by attending the meeting and voting in person or
persons as the Board of
Directors of the Company may recommend. All of the nominees are currently
directors of the Company. All of the nominees for director have agreedby written notice to
serve
if elected. The Company recommends a vote FOR the nominees for election to the
Board.
TO BE ELECTED AS DIRECTORS FOR TERMS ENDING 2010: DIRECTOR SINCE
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WILLIAM J. BARTLETT, 57 2004
Retired partner, Ernst & Young Australia. Mr. Bartlett was an accountant
and consultant with Ernst & Young for over 35 years and advised numerous
clients in the global insurance industry. Mr. Bartlett was appointed a
partner of Ernst & Young in Sydney, Australia in July 1980, a position he
held until his retirement in June 2003. He served as chairman of the
firm's global insurance practice from 1991 to 2000, and was chairman of
the Australian insurance practice group from 1989 to 1998. He holds
several professional memberships in Australia (ACPA and FCA), South Africa
(CASA), and the United Kingdom (FCMA). Mr. Bartlett is a member of the
Australian Life Insurance Actuarial Standards Board and is a consultant to
the Australian Financial Reporting Council on Auditor Independence.
2
ALAN C. HENDERSON, 61 2002
Retired President and Chief Executive Officer of RehabCare Group, Inc.
from June 1998 until June 2003. Prior to becoming President and Chief
Executive Officer, Mr. Henderson was Executive Vice President, Chief
Financial Officer and Secretary of RehabCare from 1991 through May 1998.
Mr. Henderson was a director of RehabCare Group, Inc. from June 1998 to
December 2003, Angelica Corporation from March 2001 to June 2003, and
General American Capital Corp., a registered investment company, from
October 1989 to April 2003.
A. GREIG WOODRING, 55 1993
President and Chief Executive Officer of the Company since 1993. Mr.
Woodring headed the reinsurance business at General American Life
Insurance Company ("General American") from 1986 until the Company's
formation in December 1992. He also serves as a director and officer of a
number of subsidiaries of the Company.
TO CONTINUE IN OFFICE UNTIL 2009:
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STUART I. GREENBAUM, 70 1997
Professor emeritus at the John M. Olin School of Business at Washington
University since January 2007. Mr. Greenbaum served as Dean of the Olin
School of Business from July 1995 to July 2005 and as professor from July
2005 to January 2007. Prior to joining the Olin School of Business, he
spent 20 years at the Kellogg Graduate School of Management at
Northwestern University where he was Director of the Banking Research
Center and Norman Strunk Distinguished Professor of Financial
Institutions. Mr. Greenbaum has served on the Federal Savings and Loan
Advisory Council and the Illinois Task Force on Financial Services, and
has been a consultant for the American Bankers Association, the Bank
Administration Institute, the Comptroller of the Currency, the Federal
Reserve System, and the Federal Home Loan Bank System, among others.
STEVEN A KANDARIAN, 54 2007
Executive Vice President and Chief Investment Officer of MetLife since
April 2005. From March 2004 to April 2005, he was an independent financial
consultant. Prior to that he was Executive Director of the Pension Benefit
Guaranty Corporation ("PBGC") from December 2001 to February 2004. Before
joining the PBGC, he held positions of increasing responsibility at
various firms and companies involving private equity, investment banking
and corporate mergers and acquisitions.
GEORGETTE A. PILIGIAN, 42 2006
Senior Vice President and Chief Information Officer, Institutional
Business Metropolitan Life Insurance Company ("Metropolitan Life") since
February 2006. Ms. Piligian joined MetLife in 1987 and has led various
transformation efforts and technology departments within the Company. In
September of 1999, she was appointed as a Vice President, in 2002 became
the Chief Information Officer for Corporate Systems and in 2003 became a
Senior Vice President. Ms. Piligian received her Bachelors Degree in
Business Computer Information Systems from Hofstra University.
3
TO CONTINUE IN OFFICE UNTIL 2008:
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J. CLIFF EASON, 59 1993
Retired President and CEO of Southwestern Bell Telephone, SBC
Communications, Inc. ("SBC"), a position he held from September 2000
through January 2001. He served as President, Network Services, SBC from
October 1999 through September 2000; President, SBC International of SBC,
from March 1998 until October 1999; President and CEO of Southwestern Bell
Telephone Company ("SWBTC") from February 1996 until March 1998; President
and CEO of Southwestern Bell Communications, Inc. from July 1995 through
February 1996; President of Network Services of SWBTC from July 1993
through June 1995; and President of Southwestern Bell Telephone Company of
the Midwest from 1992 to 1993. He held various other positions with
Southwestern Bell Communications, Inc. and its subsidiaries prior to 1992,
including President of Metromedia Paging from 1991 to 1992. Mr. Eason was
a director of Williams Communications Group, Inc. until his retirement in
January 2001.
JOSEPH A. REALI, 54 2002
Senior Vice President and Tax Director of Metropolitan Life since 1999.
Mr. Reali has served as the MetLife liaison with RGA since July 2002. Mr.
Reali joined MetLife in 1977 as an attorney in the Law Department, and in
1985 he became a Vice President in the Tax Department. In 1993 he was
appointed Vice President and Corporate Secretary, and in 1997 he became a
Senior Vice President. Mr. Reali received a J.D. degree, cum laude, from
Fordham University School of Law and an LL.M degree in taxation from New
York University Law School. Mr. Reali serves as Counsel and Secretary of
the Metropolitan Life Foundation. As Tax Director, Mr. Reali is
responsible for corporate tax issues at Metropolitan Life, and issues with
respect to its holdings in RGA.
CORPORATE GOVERNANCE
We have adopted an Employee Code of Business Conduct and Ethics (the
"Employee Code"), a Directors' Code of Conduct (the "Directors' Code"), and a
Financial Management Code of Professional Conduct (the "Financial Management
Code"). The Employee Code applies to all employees and officers of RGA and its
subsidiaries. The Directors' Code applies to directors of RGA and its
subsidiaries. The Financial Management Code applies to our chief executive
officer, chief financial officer, corporate controller, primary financial
officers in each business unit, and all professionals in finance and
finance-related departments. We intend to satisfy our disclosure obligations
under Item 5.05 of Form 8-K by posting on our website information about
amendments to, or waivers from, any provision of the Financial Management Code
that applies to our chief executive officer, chief financial officer, and
corporate controller.
In March 2004, the Board of Directors adopted Corporate Governance
Guidelines, a revised Audit Committee Charter, charters for the Compensation
Committee and Nominating and Corporate Governance Committee, and Policies on
Communications (collectively "Governance Documents"). The Codes and Governance
Documents referenced above are available on our website at www.rgare.com.
Information on our website does not constitute part of this proxy statement. We
will provide without charge, upon written or oral request, a copy of any of the
Codes of Conduct or Governance Documents. Requests should be directed to
Investor Relations,us addressed to: Reinsurance Group of America, Incorporated, 1370 Timberlake Manor Parkway, Chesterfield, Missouri 63017, Attention Corporate Secretary. No such revocation shall be effective, however, unless and until received by electronic mail
(investrelations@rgare.com)the Company at or prior to the meeting. Quorum and Required Vote
The presence at the meeting, in person or represented by
telephone (636-736-7243).
4
DIRECTOR INDEPENDENCE
In accordance with the Corporate Governance Guidelines, the Board
undertook reviews of director independence in February 2006 and February 2007.
During each of these reviews, the Board received a report from the Law
Department noting that there were no transactions or relationships between RGA
or its subsidiaries and Messrs. Bartlett, Eason, Greenbaum, or Henderson, nor
any member of their immediate family. The purpose of this review was to
determine whether any of those directors had a material relationship with us
that would preclude such director from being independent under the listing
standardsproxy, of the NYSE or our Corporate Governance Guidelines.
As a resultholders of this review, the Board affirmatively determined, in its
judgment, that each of the four directors named above are independent of us and
our management under the applicable standards. Messrs. Kandarian and Reali, and
Ms. Piligian are considered non-independent directors because of their status as
senior executives or officers of MetLife or its subsidiaries and affiliates. Mr.
Woodring is a non-independent director because he is our Chief Executive
Officer.
COMMUNICATIONS WITH THE BOARD OF DIRECTORS
The Board of Directors has adopted Policies on Communications, which
describe the process for interested parties and shareholders to communicate with
our directors and the Board. The Policies on Communications are available on our
website at www.rgare.com. Information on our website does not constitute part of
this proxy statement. Interested parties and shareholders may communicate
directly with our directors, including the presiding director, Mr. Kandarian, or
with the lead independent director, Mr. Greenbaum, by sending a written
communication as follows:
General Counsel
Reinsurance Group of America, Incorporated
1370 Timberlake Manor Parkway
Chesterfield, MO 63017
The Communications Policy provides that the General Counsel will make a
record of the receipt of any such communications and, if requested by such
persons, sort and organize the communications and summarize information. All
properly addressed communications will be delivered not less than once each
calendar quarter, and will not be directed to or reviewed by management prior to
receipt by such persons.
CONTROLLED COMPANY EXEMPTION
The listing standards of the NYSE require listed companies to have a Board
of Directors that have a majority of independent directors. There is an
exemption from this requirement for "controlled companies," which means a
company of which more than 50%the outstanding shares of the Company entitled to vote shall constitute a quorum for purposes of such matter. If a shareholder responds and abstains from voting, power is held by an individual, a
group or another company. Controlled companies need not comply withsuch proxy will have the requirement to have a majority of independent directors or Compensation
Committee and Nominating and Corporate Governance Committee, respectively,
composed entirely of independent directors. As of February 1, 2007, MetLife
beneficially owns approximately 52.5% of our outstanding shares; therefore, we
qualifysame effect as a "controlled company" undervote against the NYSE listing standards. We rely onproposals. Under the
controlled company exemption in connection with the requirement to have a
majority of independent directors. However, we have chosen not to rely on the
exemption for the Compensation Committee and Nominating and Corporate Governance
Committee and, as of February 20, 2007, the Board determined that, in its
judgment, those two Committees were composed entirely of independent directors.
OTHER MATTERS
In February 2007, the Board designated Mr. Kandarian as the presiding
director, whose primary responsibility is to preside over periodic executive
sessions of the Board in which the management director
5
(Mr. Woodring) does not participate. In February 2007, the Board also named Mr.
Greenbaum as lead independent director.
BOARD OF DIRECTORS AND COMMITTEES
The Board of Directors held a total of four regular meetings and one
special meeting during 2006. Each incumbent director attended at least 75% of
the meetings of the Board and committees on which he or she served during 2006.
We do not have a policy with regard to attendance by Directors at the annual
meeting of shareholders. None of the non-management directors attended the 2006
annual meeting of shareholders. The Board of Directors has an Audit Committee, a
Compensation Committee, and a Nominating and Corporate Governance Committee.
AUDIT COMMITTEE
The Audit Committee met eight times in 2006, and consisted of Messrs.
Bartlett (Chairman), Eason, Greenbaum, and Henderson. The Audit Committee is
directly responsible for the appointment, compensation, retention and oversight
of the work of our independent auditor. The Committee oversees our accounting
and financial reporting processes, the adequacy of our internal control over
financial reporting and of our disclosure controls and procedures, and the
integrity of our financial statements, pre-approves all audit and non-audit
services to be provided by the independent auditor, reviews reports concerning
significant legal and regulatory matters, and reviews the performance of our
internal audit function. The Committee also reviews and discusses our filings on
Forms 10-K and 10-Q and the financial information in those filings. The Audit
Committee works closely with management as well as our independent auditor and
internal auditor. A more detailed description of the role and responsibilities
of the Audit Committee is set forth in a written charter, adopted by the Board
of Directors, which is available on our website (www.rgare.com). Information on
our website does not constitute part of this proxy statement. The Audit
Committee has established procedures for the receipt, retention, and treatment
of complaints regarding accounting, internal accounting controls, or auditing
matters. Please see the Policies on Communications, which is available on our
website.
The Board of Directors has determined, in its judgment, that all of the
members of the Audit Committee are independent within the meaning of SEC
regulationsrules applicable to audit committeesbroker-dealers, brokers, banks and the listing standards of the New
York Stock Exchange ("NYSE"). The Board of Directors has determined,other nominee record holders holding shares in its
judgment, that Messrs. Bartlett, Greenbaum and Henderson are qualified as audit
committee financial experts within the meaning of SEC regulations and the Board
has determined that each of them has accounting and related financial management
expertise within the meaning of the listing standards of the NYSE. The Audit
Committee Charter provides that members of the Audit Committee may not
simultaneously serve on the audit committee of more than two other public
companies.
COMPENSATION COMMITTEE
Our Compensation Committee meets as often as necessary to perform its
duties and responsibilities which include establishing and overseeing our
general compensation policies, reviewing and approving the performance and
compensation of the CEO and certain other executive officers, and reviewing and
recommending compensation for other executives and employees to the Board of
Directors. During 2006, the Compensation Committee consisted of Messrs.
Henderson (Chairman), Bartlett, Eason, and Greenbaum. The Committee met six
times in 2006 to discuss our compensation programs, as follows:
o January 2006: Recommend profit sharing award for 2005; discuss
compensation summary report; review management incentive plan
("MIP") weights for 2006; and review the executive compensation
report provided by Watson Wyatt Worldwide ("Watson Wyatt").
o February 2006: Our Committee met twice to approve the 2005 MIP
awards; consider management's recommendations on targets for the
2006 MIP and intermediate term bonus program ("ITB") grants;
consider management's recommendations on 2006 base salaries for
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executive officers; approve 2006 grants of stock options and
performance contingent restricted stock ("PCRS") for our executive
officers; approve the 2006 MIP measures with respect to executive
officers; and approve the 2006 base salary for our chief executive
officer.
o April 2006: Review compensation summary; discuss executive stock
ownership; discuss MIP goals and targets; discuss compensation of
certain new hires; and discuss present state of our pension benefit
program.
o July 2006: Review executive equity and ownership report; and review
executive benefit report.
o October 2006: Discuss new SEC reporting requirements with respect to
executive compensation; approve 2007 guidelines with respect to
merit increases, promotions, and salary structure adjustments;
discuss compensation of certain new hires; and discuss retention of
an independent compensation consultant.
A more detailed description of the role and responsibilities of the
Compensation Committee is set forth in a written charter adopted by the Board of
Directors, which is available on our website (www.rgare.com). Information on our
website does not constitute part of this proxy statement. The Board of Directors
has determined, in its judgment, that all of the Committee's members are
independent within the meaning of the listing standards of the NYSE.
Messrs. Henderson, Bartlett, Eason or Greenbaum are not and“street name” have never
been officers or employees of RGA or any of its subsidiaries. None of our inside
directors or officers serve on the compensation committee of another company of
which a member of the Compensation Committee is an officer.
NOMINATING AND CORPORATE GOVERNANCE COMMITTEE
The Nominating and Corporate Governance Committee met once in 2006, and
consisted of Messrs. Greenbaum (Chairman), Bartlett, Eason, and Henderson. This
Committee is responsible for developing and implementing policies and practices
relating to corporate governance, including reviewing and monitoring
implementation of our Corporate Governance Guidelines. In addition, the
Committee identifies individuals qualified to become members of the Board,
consistent with the criteria established by the Board; develops and reviews
background information on candidates for the Board; and makes recommendations to
the Board regarding such candidates. The Committee also will prepare and
supervise the Board's annual review of director independence and the performance
of self-evaluations to be conducted by the Board and Committees. A more detailed
description of the role and responsibilities of the Compensation Committee is
set forth in a written charter adopted by the Board of Directors, which is
available on our website (www.rgare.com). Information on our website does not
constitute part of this proxy statement. The Board of Directors has determined,
in its judgment, that all of the Committee's members are independent within the
meaning of the listing standards of the NYSE. Shareholders wishing to propose
nominees to the Committee for consideration should notify in writing our
Secretary in accordance with the process described in "Shareholder Nominations
and Proposals." The Secretary will inform the members of the Committee of such
nominees.
COMPENSATION DISCUSSION AND ANALYSIS
Our Board of Directors has delegated to the Compensation Committee or
"Committee" the authority to establish and oversee our general compensation
policies, to review the performance and approve the compensation of our CEO, and
to review and recommend compensation to the Board of Directors for other
executives and employees. The Committee also produces an annual reportvote on executive compensation for inclusion in our proxy statement. In 2006, the
Compensation Committee consisted of Messrs. Henderson (Chairman), Bartlett,
Eason, and Greenbaum. RGA Reinsurance Company, one of our wholly owned
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indirect subsidiaries, employs all of our "executive officers," including the
seven officers who were reporting persons for purposes of Section 16 of the
Exchange Act on December 31, 2006, except for Graham Watson, who is employed by
RGA International Corporation.
COMPENSATION PHILOSOPHY AND OBJECTIVES
We design our compensation philosophy and objectives to:
o provide competitive total compensation opportunities that will
attract, retain and motivate high-performing executives;
o align the compensation plans to our business strategies;
o reinforce our pay for performance culture by making a significant
portion of compensation variable and based on company, business unit
and individual performance; and
o align the financial interests of our executives and shareholders
through stock-based incentives and by building executive ownership
in us.
We use two key financial performance measures and weights designed to add
emphasis to operating earnings to align our compensation plans to our business
strategies, reinforce our pay for performance culture using variable
compensation based on performance, and align the financial interests of our
executives (in the case of the ITB). We measure our performance under our MIP
based 75% on annual operating earnings (net incomeroutine proposals when they have not received instructions from continuing operations
less realized capital gains and losses and certain other non-operating items)
per share and 25% on annual consolidated revenues. For the ITB, we measure
performance based 67% on operating earnings per share growth and 33% on a
compounded annual growth rate for revenue growth, both calculated as of the end
of the three-year performance period.
ELEMENTS OF COMPENSATION
Our compensation program consists of base salary, MIP, ITB, stock options,
and retirement and pension benefits. Our base salaries are designed to provide a
part of a competitive total compensation package that will attract, retain and
motivate high-performing executives. The MIP is designed to reinforce our pay
for performance culture by making a significant portion of an executive's
compensation variable and based on company, business unit and individual
performance. The MIP also aligns compensation with our short-term business
strategies. Our ITB and stock options are designed to reinforce our pay for
performance culture, align the financial interests of our executives and
shareholders, align compensation with our intermediate and long-term business
strategies, and provide a significant equity component as part of the total
compensation package. Finally, our retirement and pension benefits are designed
to provide another part of a competitive total compensation package that permits
us to attract and retain key members of our management team.
COMPENSATION CONSULTANT
In forming its recommendations on our overall compensation program, the
Committee has from time to time engaged an independent consulting firm to
provide advice about competitive compensation practices and determine how our
executive compensation compares to that of other comparable companies, including
publicly held insurance and reinsurance companies. Prior to 2005, we had
retained Watson Wyatt, a nationally recognized consulting firm, to perform a
variety of compensation consulting services with respect to non-executive
positions and executive compensation analysis. Beginning in 2005, the Committee
approved the engagement of Watson Wyatt to review our compensation policies and
to provide relevant
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recommendations to the Committee. Watson Wyatt provided us with the results of
its study in early 2006, which results were used to establish executive
compensation in 2006.
MANAGEMENT PARTICIPATION AND INVOLVEMENT
Pursuant to the Compensation Committee charter, the Committee makes all
compensation decisions and approves the compensation of our executive officers,
and makes compensation recommendations for approval by our Board for all other
employees. Management plays a significant role in the compensation-setting
process. The most significant aspects of management's role are:
o evaluating employee performance;
o establishing business performance targets, goals and objectives; and
o recommending salary levels and option awards.
Our chief executive officer works with the Committee chair to establish
the agenda for Committee meetings. Management also prepares relevant information
and reports for each Compensation Committee meeting. Our chief executive officer
also participates in Committee meetings at the Committee's request to provide:
o background information regarding our strategic objectives;
o his evaluation of the performance of the executive officers; and
o compensation recommendations as to executive officers (other than
himself).
Our executive officersbeneficial owners. However, brokers, banks and other members of managementnominee record holders are also available
to Watson Wyatt or any other compensation consultant to provide information
regarding position descriptions, compensation history and other information as
requested and to review draft results provided by the Committee's compensation
consultant.
Three of our directors are senior executives of MetLife, Inc., the
beneficial owner of approximately 52.5% of our outstanding common stock as of
February 1, 2007. The MetLife directors are invited to attend and participate in
Compensation Committee meetings, although they are notprecluded from exercising their voting members of the
Committee. From time to time the MetLife directors provide recommendations or
suggestions with respect to our executive compensation arrangements anddiscretion with respect to the settingapproval of our chief executive officer's compensation.
BENCHMARKING OF COMPENSATION
In 2005, Watson Wyatt performed an analysis of all elements of our total
direct compensation, including a competitive market assessment of the pay levels
for our executives at the Senior Vice President level and above, which at that
time included 26 positions. The analysis studied multiple published surveys of
executive compensation practices and included publicly-available information
relating to a peer group of 12 publicly-traded insurance companies.
The analysis also included a review of five published surveys, two of
which were insurance-specific and three of which were general executive
compensation surveys. The scope of the survey review focused on our size in
terms of premiums, revenues, and asset levels, and also assessed published
survey data with respect to all 26 executive positions. Insurance industry
specific data was collected from the published surveys, when available. Survey
data was collected on companies that were similar to our size based on premiums,
revenues and assets.
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The study of our peers focused on publicly-available information, and thus
focused on pay levels for their top five executives, as this is the information
that is publicly disclosed. Pay levels for our top five executives were compared
to peers based on highest-paid ranking, using total cash compensation. As
available, position specific comparisons also were made.
The peer companies studied in 2006 included:
Amerus Group Co PartnerRe Ltd.
Berkley (WR) Corp. Phoenix Companies Inc.
Everest Re Group Ltd. Protective Life Corp.
Jefferson-Pilot Corp. Renaissance Re Holdings Ltd.
Nationwide Financial Services Scottish Re Group Ltd.
Odyssey Re Holdings Corp. XL Capital Ltd.
The Committee defined the peer group based on various metrics, including
industry and size. The Committee determined that the peer companies should
consist of publicly-traded reinsurers (life and property-casualty) and financial
services companies, including direct competitors, that were approximately
one-half to 2.5 times the size of us (based on revenues, assets, and other
similar measures). We expect it will be necessary to update the list
periodically in order to maintain an appropriate list of companies for pay
comparisons as a result of mergers and acquisitions, divestitures, growth in our
size and the size of those companies in the peer group, and other changes.
We used the analysis of Watson Wyatt as a starting point for our
compensation determinations relating to base salary, total cash compensation,
long-term incentives and total direct compensation. We considered individual
performance, internal pay equity among positions and levels, and the relative
importance of positions to us. We also considered our financial performance as
demonstrated by revenue and earnings per share and various other factors that
differentiate us from our peers. After reviewing Watson Wyatt's recommendations
as compared to our overall performance and our future growth targets, we
established a compensation strategy that we believe aligns our compensation with
the market median in order to allow us to retain our current talent and attract
new talent.
The Committee determines a total compensation package for each of the five
executives who are identified in the Summary Compensation Table (whom we refer
to as our "named executive officers") that includes base salary, MIP bonus,
equity awards, and pension benefits. In determining the targeted overall
compensation for our chief executive officer, we considered not only the factors
described above, but also our performance over the previous two years. We used a
similar analysis to establish the targeted overall compensation for our other
named executive officers for 2006.
COMPANY COMPENSATION POLICIES
BASE SALARIES
In determining the base salaries of our named executive officers, the
Committee considers our compensation compared to that of the relevant market, as
determined by a review of published surveys. The Committee also considers
recommendations submitted to it by our chief executive officer, who provides the
Committee with details as to executive performance as compared to Company
performance and the executive's individual and divisional results. In February
2006, based upon an analysis of executive compensation and the recommendations
of our chief executive officer, our Committee approved salary increases for the
named executive officers that averaged 8.8%. The purpose of this increase was to
align the named executive officers' base compensation with the market median.
Based on our compensation strategy, our goals for and analysis of targeted
overall compensation, and Company performance during the previous two years, we
increased the 2006 base salary for Greig Woodring, our chief executive officer,
by 6.5% to $700,000. This amount reflects a level that we concluded was
appropriate based on our review of his performance and leadership, and our
consideration of factors relating
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to motivation and retention. We used a similar process to establish the
following base salaries for 2006 for the other named executive officers, as
follows: Jack B. Lay, Senior Executive Vice President and Chief Financial
Officer - $395,000; David B. Atkinson, Executive Vice President and Chief
Operating Officer - $420,000; Paul A. Schuster, Senior Executive Vice President,
U.S. Operations - $395,000; and Graham Watson, Senior Executive Vice President,
International - $450,000.
ANNUAL MANAGEMENT INCENTIVES
Our management and professional level associates are eligible to
participate in our MIP, which provides annual cash incentive compensation based
on one or more of the following factors: our overall performance, the
performance of the participant's division or business unit, and individual
performance during the previous year. Under the MIP, participants may receive a
cash bonus each year.
We generally set MIP objectives during February of each year, and
determine results and awards the following February. MIP objectives are not tied
to our peer group, and are instead tied solely to our performance. Our results
in 2006 were measured 75% on annual operating earnings (net income from
continuing operations less realized capital gains and losses and certain other
non-operating items) per share and 25% on annual consolidated revenues.
Divisional results are based on each division's revenues and operating earnings.
Individual performance results are measured by successful completion of major
projects, production, client development, personal development or similar-type
goals in which the employee played a major role. While we intend to tie
individual performance to clearly articulated and objective measures, it is
necessary, and at times prudent, for management to use a certain degree of
discretion in evaluating individual results. Based on these criteria, the
Committee approves a schedule of participants, which includes individual
incentive allocations, a minimum performance level that must be met before any
payment to the individual can be made, and a target and a maximum. In addition,
overall Company performance must meet certain minimum levels, which we refer to
as "trigger," as determined in advance by the Committee, before any awards are
made under the MIP. Awards are based on a specified percentage of salary, which
varies for each participant.
The MIP award is designed to serve as a short-term incentive. Targets
reflect our short-term goals for operating earnings per share and revenue
growth. The allocation of MIP awards between individual, division and
company-wide performance varies for each participant based on his or her job
responsibilities. In general, allocations for divisional and individual
performance are weighted more heavily for employees with less company-wide
responsibility, and allocations for company-wide performance are weighted more
heavily for executives with more company-wide responsibility. The MIP allocation
for all of the named executive officers generally is based solely on overall
company results with no specific allocation for divisional or individual
performance. We do, however, consider divisional and individual performance when
evaluating an executive officer's total compensation, and may from time to time
establish a specific MIP allocation for a particular business objective or
project.
In February 2006, the Compensation Committee approved the performance
goals and business criteria for the 2006 named executive officers under the MIP
for 2006, including the minimum, target and maximum bonus opportunities, as a
percentage of base salary. In February 2007, the Committee approved the MIP
awards for our named executive officers for 2006 performance. The Committee
determined that our operating earnings and revenue growth in fiscal 2006 both
exceeded the amount for target bonus awards but neither measure reached the
amount for maximum bonus awards. The average MIP award for 2006 performance as a
percentage of salary for our named executive officers was approximately 135%.
The following table describes the minimum, target and maximum bonus
opportunities, as a percentage of base salary, as approved by the Committee in
February 2006, and the MIP payments for 2006 performance, as approved by the
Committee in February 2007:
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2006 BONUS AT 2006 BONUS AT 2006 BONUS AT MIP PAYMENT
NAME MINIMUM TARGET MAXIMUM FOR 2006
A. Greig Woodring 0% 100% 200% $ 947,590
David B. Atkinson 0% 80% 160% $ 454,843
Jack B. Lay 0% 80% 160% $ 427,769
Paul A. Schuster 0% 80% 160% $ 411,780
Graham Watson 0% 80% 160% $ 493,380
INTERMEDIATE AND LONG-TERM INCENTIVES
In 2006, we made equity incentive grants under our ITB consisting of
shares of PCRS and long-term equity incentive grants consisting of stock
options. Shares of PCRS and stock options are issued under our Flexible Stock
Plan.
Our Flexible Stock Plan, which was established in 1993, provides for the
award of various types of long-term equity incentives, including stock options,
stock appreciation rights, restricted stock, performance shares, and other stock
based awards, to officers at the vice president level and above who have the
ability to favorably affect our stock price and financial results. The face
value of the annual award as a multiple of base salary varies depending on the
individual's position, and ranges from 0.5 to 4.0 times. The value of each
annual equity incentive grant is evenly split between grants of stock options
and PCRS. We believe this allocation allows us to reward the achievement of
intermediate and long-term goals equally, and was based both on comparisons to
the market and the overall risk/reward tradeoff. The number of shares for the
portion of the annual equity grant represented by PCRS is determined using the
Black-Scholes pricing model.
The PCRS grants are designed to allow us to reward the achievement of
specific intermediate-term corporate financial performance goals with equity
that is earned on the basis of performance. The stock options are designed to
focus attention on accomplishment of long-term goals and do not have performance
criteria. We implemented the PCRS program because we believe it is consistent
with our pay-for-performance compensation philosophy and focuses on financial
performance. We continue to evaluate the appropriate mix of long-term pay
elements (i.e., stock options vs. PCRS or restricted shares) in comparison to
the market and to best support our strategy. We believe that stock options
provide the most appropriate vehicle for providing long-term value to management
because of the tie to shareholder value, while the PCRS grants add an additional
performance expectation for our management to focus on growth in earnings per
share and revenue over the intermediate-term.
INTERMEDIATE-TERM BONUS PROGRAM
Our ITB program is a performance-driven incentive program implemented in
January 2004 under our Flexible Stock Plan. We believe this program reinforces
our strategic and intermediate-term financial and operating goals. Incentive
awards are intended to reflect management's involvement in our performance and
to encourage their continued contribution to our future. We view incentive
awards as an important means of aligning the economic interests of management
and shareholders.
Our management employees are eligible to participate in this program. The
purpose of the ITB is to reward participants if we achieve the rate of growth in
revenue and earnings per share that is approved each year by the Compensation
Committee when it considers annual grants. The ITB is an ongoing program with
three-year performance periods. Each year, a new three-year cycle begins, giving
us the opportunity to alter ITB performance measures as appropriate. The
three-year performance and reward period shifts attention toward intermediate
and longer-term sustained results.
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The ITB consists of PCRS units that are granted at the beginning of the
performance period at target. The Compensation Committee also sets award levels
with a minimum level of performance that must be met before any payment to the
individual can be made, as well as a target and a maximum. If we do not meet
certain performance goals, the awards will not be made, and if we exceed those
performance goals, the award can be as much as 200% of the targeted award
opportunity. PCRS grants are not treated as outstanding shares until the
performance goals are met and awards are made, as determined and approved by the
Compensation Committee. Awards are made in shares of fully vested, unrestricted
common stock. The awards also are contingent upon the participant's employment
status with us at the end of the 3-year performance period.
We use a compounded annual growth rate for revenue growth and operating
earnings per share growthnon-routine matters such as the performance measures for the ITB, calculated at
the end of the three-year performance period. When we establish the ITB targets
for a particular performance period, we may adjust those targets up or down so
they are set at amounts or ranges that are generally consistent with our
publicly disclosed intermediate-term growth rate goals. Our revenue and
operating earnings per share in 2005 did not reach the target amounts and, in
the case of operating EPS, did not achieve even the minimum level of the
established range. We established the ITB target and range for revenue growth
for the period beginning in 2006 at levels that are consistent with our publicly
disclosed intermediate-term goal for that measure. However, we adjusted upward
the ITB target and range for the same period for earnings per share growth to a
level significantly above our publicly disclosed intermediate-term goal for that
measure.conversion proposal. As a result, achievementabsent specific instructions from the beneficial owner, brokers, banks and other nominee record holders are not empowered to vote those “street name” shares. Broker non-votes will have no effect on the outcome of the target earnings per share growth rate
will require a high level of financial and operating performance. We believe the
goals and ranges we establishedvote for the 2006 grantsconversion proposal or the adjournment proposal because the vote required for approval of PCRS under the ITB are
challenging but achievable.
Upon retirement of a holder of a PCRS grant made pursuant to this plan,
provided that the holder has attained a combination of age and service, not to
exceed 10 years of service, that equals at least 65, the units will be pro-ratedproposal is based on the number of monthsshares actually voted, whether in person or by proxy. Since the vote required for approval of the holder's participation during the
three-year performance period and the number of shares earned.
STOCK OPTIONS
Stock options are granted annually, and the number of options grantedcharter proposal is based on position level. Stock options are granted as part of a total
compensation package for our management. The Committee considers compensation
data of the peer group in determining the amount of options granted to our named
executive officers and considers market data from published surveys in
determining the amount of options granted to other employees.
The vesting schedule for the relevant stock options is five years, no
portion of which vests in the first year, and 25% of which vests in the four
remaining years. Upon retirement of a holder of stock options pursuant to this
plan, provided that the holder has attained a combination of age and service,
not to exceed 10 years of service, that equals at least 65, the relevant options
will continue to vest in accordance with the vesting schedule. Beginning in
2006, our Compensation Committee makes option grants at its February meeting.
The options are granted with an exercise price equal to the fair market value on
the grant date, which is the date of the Committee meeting. The fair market
value of a share of our common stock on a particular date is determined as the
closing pricepercentage of the shares of class A common stock and class B common stock outstanding, broker non-votes will have the same effect as a vote against the charter proposal.
2
In order for the conversion proposal to be approved, it must receive the affirmative vote of the holders of both:
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| • | a majority of the class A common stock represented in person or by proxy and entitled to vote at the special meeting; and |
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| • | a majority of the class B common stock represented in person or by proxy and entitled to vote at the special meeting. |
In order for the charter proposal to be approved, the conversion proposal must be approved and the charter proposal must receive the affirmative vote of the holders of:
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| • | a majority of the outstanding shares of class A common stock; |
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| • | a majority of the outstanding shares of class B common stock; and |
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| • | a majority of all outstanding shares of common stock. |
In order for the adjournment proposal to be approved, it must receive the affirmative vote of the holders of a majority of the shares of class A common stock and class B common stock represented at the special meeting, voting as a single class, whether or not a quorum is present.
MetLife, Inc. and certain of its subsidiaries have granted an irrevocable proxy to the Company and certain officers of the Company and its designees to vote in any election of the Company’s directors, the 3,000,000 shares of class A common stock in proportion to the other holders of that class, and, in all other matters, in proportion to the votes cast by the other holders of class A common stock and class B common stock, taken together as a whole.
Expenses of Soliciting Proxies
The cost of soliciting proxies for the meeting will be borne by the Company. Solicitations may be made on behalf of our board of directors by mail, personal interview, telephone or other electronic means by officers and other employees of the Company, who will receive no additional compensation for these activities. To aid in the solicitation of proxies, we have retained MacKenzie Partners, which will receive a fixed fee of approximately $10,000, in addition to the reimbursement of out-of-pocket expenses, for its performance of certain ministerial services related to the solicitation. MacKenzie Partners will not make any recommendation to shareholders regarding the approval or disapproval of the conversion proposal. We will request banks, brokers, custodians, nominees, fiduciaries and other record holders to forward copies of this proxy statement to persons on whose behalf they hold shares of our class A common stock and our class B common stock and to request authority for the exercise of proxies by the record holders on behalf of those persons. In compliance with the regulations of the Securities and Exchange Commission, or “SEC”, and the NYSE, we will reimburse such persons for reasonable expenses incurred by them in forwarding proxy materials to the beneficial owners of our class A common stock and class B common stock.
How You Can Vote
You can vote your shares at the meeting or by completing, signing, dating and returning your proxy in the enclosed envelope. Most shareholders also have the option of voting their shares on the NYSEInternet or by telephone. If Internet or telephone voting is available to you, voting instructions are printed on your proxy card or included with your proxy materials. If you vote your proxy over the given date. The options expire 10
years after grant.
2006 GRANTS AND AWARDS OF PCRS AND OPTIONS
In February 2006, we approved grantsInternet or by telephone, you do NOT need to mail back your proxy card. If you own shares of 144,097 PCRS units, including
37,329 toboth our named executive officers. The performance period for the 2006 PCRS
grant began on January 1, 2006 and will end on December 31, 2008. We also
granted a total of 336,725 options forclass A common stock including 83,195and class B common stock, you will need to vote separately for each class of stock.
3
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The tables below sets forth, as of September 30, 2008, except as otherwise noted, certain information concerning the beneficial ownership of shares of our named executive officers. The grants were madeclass A common stock and class B common stock by:
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| • | each director of the Company; |
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| • | each executive officer of the Company named in our proxy statement for our last annual meeting; |
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| • | the current directors and executive officers of the Company as a group; and |
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| • | persons who are known to be holders of 5% or more of shares of the Company’s common stock. |
Each person has sole voting and investment power over the shares reported except as noted. For purposes of this table, “beneficial ownership” is determined in accordance withRule 13d-3 under the Securities Exchange Act of 1934, as amended (which we refer to as the “Exchange Act”), pursuant to
the termswhich a person or group of
the
Flexible Stock Plan and an award agreement.
13
In February 2007, the Compensation Committee approved the awards for the
named executive officers for the 2004 grantspersons is deemed to have “beneficial ownership” of PCRS. The 2004 grants used a
three-year performance period that ended December 31, 2006. The Compensation
Committee determined that our operating earnings and revenue growth for the
three-year performance period attained the level for maximum awards of 200% and
approved the PCRS awards for the named executive officers for the 2004 grants.
See "Grants of Plan-Based Awards in 2006" for a description of the 2006 grants
of PCRS and stock options, and "Option Exercises and Stock Vested During Fiscal
2006" for a description of the PCRS awards for the 2004-2006 grants.
EXECUTIVE STOCK OWNERSHIP GUIDELINES
In February 2004, in order to further align the interests of our
management and our shareholders, we revised the executive stock ownership
guidelines initially adopted in October 1996. The revised guidelines increased
the market value of our shares that executives should seek to hold, based on a
multiple of the executive's base salary, as follows: our Chief Executive Officer
(four times), Senior Executive Vice Presidents and Executive Vice Presidents
(three times), and Senior Vice Presidents (two times). The market value of
shares includes only thoseany shares of common stock and restricted shares that are
directly or beneficially owned bysuch person has the executive. Executives who are subjectright to acquire within 60 days. For computing the guidelines must retain the net shares (net of applicable taxes and, for
options, the exercise cost) from any stock option exercise or award of PCRS
until they satisfy their respective stock ownership requirement.
As of February 2007, each of our named executive officers has met his
stock ownership requirements through holdings of shares of our common stock,
including restricted stock.
TIMING OF REGULAR EQUITY GRANTS
We typically release earnings for the fourth quarter in late Januarypercentage of the following year. The Compensation Committee meets in mid-Februaryclass of securities held by each year to approve regular grantsperson or group of stock options and PCRS. Equity grants are
effective on and have a grant date of the same day as the Committee meeting, and
the exercise price for the stock option grants is determined based on the
closing price of our common stock on the New York Stock Exchange on the day of
the Committee meeting in February. This timing and process ensure that our
fourth quarter earnings information is fully disseminated to the market by the
time the stock option grants and exercise price are determined. The PCRS awards
are measured by financial performance over a three-year period and the market
price of our common stock is not a factor in those calculationspersons named above, any shares which such person or measures. In
2005 and prior years, we made annual equity incentive grants on the date of the
board and committee meetings in late January.
PERQUISITES
We compensate our executive officers in the form of cash and equity.
Accordingly, we do not provide executive officers or their families with
perquisites such as planes, cars, or apartments, and we do not reimburse
executive officers or any of our employees for personal-benefit perquisites such
as club dues or other social memberships. Executive officers and other employees
may seek reimbursement for business related expenses in accordance with our
business expense reimbursement policy.
PROFIT SHARING PLAN
All employees of RGA Reinsurance Company who meet the eligibility
requirements participate in the profit sharing plan. Effective January 1, 2001,
we adopted a safe harbor design for the plan that provides for a match of up to
4% of compensation. All eligible employees also are entitled to receive a profit
sharing award ranging from 0% to 6% of compensation depending on whether we meet
or exceed our minimum performance level and targets, regardless of their 401(k)
participation. A minimum performance level must be met before the profit sharing
award can be made. The minimum performance level and targets for each year are
established at the beginning of the year. To the extent that the participant's
cash compensation is less than limits set by the IRS ($220,000 for 2006), a
participant may elect to defer up to one-half of his profit sharing award to the
plan, while the other one-half is automatically contributed to the plan.
14
As stated above, we exceeded the target amounts for operating earnings per
share and revenue growth but did not meet the amounts for maximum awards in
fiscal 2006. Based on these results, in January 2007 the Board of Directors
approved a profit sharing award of 4.0% for 2006.
RETIREMENT PLANS
Some of our employees, including our executive officers, participate in
the RGA Performance Pension Plan, or our "Pension Plan," a qualified defined
benefit plan. The Pension Plan is a broad-based retirement plan that is intended
to provide a source of income during retirement for full-time employees in the
U.S. Some of our employees, including certain executive officers, also
participate in the RGA Reinsurance Company Augmented Benefit Plan, or the "RGA
Augmented Plan," a non-qualified plan under which eligible employees are
entitled to additional retirement benefits not paid under the Pension Plan and
the RGA Profit Sharing Plan due to Internal Revenue Code limits on the amount of
benefits that may accrue and be paid under the Pension Plan and the RGA Profit
Sharing Plan. The RGA Augmented Plan provides benefits based on an employee's
total compensation and without regard to certain limitations that apply to
broad-based, qualified retirement plans, in order for a participant's retirement
income provided under the plans to be based on his or her total eligible
compensation. The Augmented Plan is generally only available to the associates
at the vice president level and above who earn more than the compensation limits
under the qualified plans ($220,000 for 2006).
Additionally, employees at the vice president level and above are eligible
to participate in our Executive Deferred Savings Plan, a non-qualified plan
which allows participants to defer income, including bonuses and incentive
compensation and to defer matching contributions without regard to qualified
plan limitations. Base pay and regular annual incentive awards, but not
long-term compensation, are treated as eligible pay under the terms of our
retirement plans. We sponsor tax-qualified pension and savings plans, as well as
non-qualified "parity" pension and savings plans providing benefits to all
employees whose benefits under the tax-qualified plans are limited by the Code.
The Committee periodically reviews our retirement benefits to ensure that the
benefits are appropriate and cost effective as part of an overall compensation
program intended to provide basic economic security for our highly skilled and
qualified workforce and at a level consistent with competitive practices.
Messrs. Woodring, Atkinson, Lay and Schuster participate in the Pension
Plan and the RGA Augmented Plan. Mr. Watson is not eligible to participate in
the U.S. pension plans. To provide a similar retirement benefit, he participates
in a supplemental executive retirement plan sponsored by RGA International
Corporation, whichpersons has the same benefit structure as the related plan for our
executives at our Canadian operating company. For additional details regarding
executive participation in our retirement plans, see "Pension Benefits in Fiscal
2006."
NO EMPLOYMENT AND SEVERANCE AGREEMENTS
Consistent with our pay-for-performance compensation philosophy, we do not
provide employment or severance agreementsright to any of our named executive
officers.
DEDUCTIBILITY OF COMPENSATION
The goal of the Committee is to comply with the requirements of Code
Section 162(m), to the extent deemed practicable, with respect to options and
annual and long-term incentive programs in order to avoid losing the deduction
for compensation in excess of $1.0 million paid to our chief executive officer
and four other highest-paid executive officers. We generally structure our
performance-based compensation plans with the objective that amounts paid under
those plans and arrangements are tax deductible, including having the plans
approved by our shareholders. However, a portion of certain ITB Awards will not
be tax deductible but we believe those awards are appropriate to achieve our
compensation objectives. We generally do not consider the accounting treatment
of various items when making compensation decisions.
15
COMPENSATION COMMITTEE REPORT
The Compensation Committee has reviewed and discussed the Compensation
Disclosure and Analysis with management. Based on its review and discussions
with management, the Compensation Committee recommended to the Board of
Directors that the Compensation Disclosure and Analysis be included in our
Annual Report on Form 10-K for 2006 and our 2007 Proxy Statement. This report is
provided by the following independent directors, who comprise the Committee.
Alan C. Henderson, Chairman
William J. Bartlett
J. Cliff Eason
Stuart I. Greenbaum
SUMMARY COMPENSATION TABLE
--------------------------
FISCAL YEAR 2006 COMPENSATION
-----------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
CHANGE IN
PENSION
NON- VALUE AND
EQUITY NONQUALIFIED
INCENTIVE DEFERRED ALL
PLAN COMPEN- OTHER
NAME AND STOCK OPTION COMPEN- SATION COMPEN-
PRINCIPAL POSITION YEAR SALARY(1) BONUS AWARDS(2) AWARDS(3) SATION(4) EARNINGS(5) SATION(6) TOTAL
- ----------------------------------------------------------------------------------------------------------------------------------
A. Greig Woodring
President and CEO 2006 $695,038 0 $1,648,767 $1,119,629 $951,990 $356,410 $37,896 $4,809,730
- ----------------------------------------------------------------------------------------------------------------------------------
Jack B. Lay
Sr. EVP and CFO 2006 $389,231 0 $ 581,113 $ 219,969 $432,169 $ 85,595 $29,906 $1,737,983
- ----------------------------------------------------------------------------------------------------------------------------------
David B. Atkinson
EVP and COO 2006 $419,077 0 $ 677,184 $ 295,737 $459,243 $116,839 $32,902 $2,000,982
- ----------------------------------------------------------------------------------------------------------------------------------
Paul A. Schuster
Sr. EVP - U.S. Ops 2006 $389,231 0 $ 557,541 $ 220,145 $416,180 $ 89,530 $29,906 $1,702,533
- ----------------------------------------------------------------------------------------------------------------------------------
Graham Watson
Sr. EVP - Int'l 2006 $445,385 0 $ 812,770 $ 376,423 $513,208 $154,472(7) $ 8,148 $3,700,661
- ----------------------------------------------------------------------------------------------------------------------------------
- -------------
1. For Messrs. Woodring, Atkinson, Lay and Schuster, includes any amounts
deferred at the election of the executive officers under the RGA
Reinsurance Company Executive Deferred Savings Plan. Mr. Watson is not a
U.S. citizen, and is not eligible to participate in the deferred savings
plan.
2. This column represents the dollar amount recognized for financial
statement reporting purposes with respect to the 2006 fiscal year for the
fair value of PCRS units granted in 2006, asacquire within 60 days (as well as grants of PCRS units
and restricted stock made in prior fiscal years, in accordance with SFAS
123R. Pursuant to SEC rules, the amounts shown disregard estimated
forfeitures related to service-based vesting conditions. For additional
information on the valuation assumptions, refer to note 17 of the RGA
financial statements in the Form 10-K for the year ended December 31,
2006, as filed with the SEC. See also the Grants of Plan-Based Awards
Table for information on awards made in 2006. These amounts reflect our
accounting expense for these awards, and do not correspond to the actual
value that will be recognized by the named executive officers.
3. This column represents the dollar amount recognized for financial
statement reporting purposes with respect to the 2006 fiscal year for the
fair value of stock options granted to each of the named executive
officers, in 2006 as well as prior fiscal years, in accordance with SFAS
123R. Pursuant to SEC rules, the amounts shown exclude the impact of
estimated forfeitures related to service-based vesting conditions. For
additional information on the valuation assumptions, refer to note 17 of
the RGA financial statements in the Form 10-K for the year ended December
31, 2006, as filed with the SEC. See also the Grants of Plan-Based Awards
Table for information on options granted in 2006. These amounts reflect
our accounting expense for these awards, and do not correspond to the
actual value that will be recognized by the named executive officers.
4. Includes, for all named executive officers, cash bonuses earned for 2006
performance and paid in March 2007 (including any bonuses deferred at the
election of the executive officers) under the cash bonus portion of the
MIP, which we describe in the "Compensation Discussion and Analysis"
("CD&A"). The cash bonus payments for 2006 performance were $947,590 for
Mr. Woodring, $427,769 for Mr. Lay, $454,843 for Mr. Atkinson, $411,780
for Mr. Schuster, and $493,380 for Mr. Watson. Also includes amounts paid
in cash or deferred at the officer's election each year under the RGA
Reinsurance Company Profit Sharing Plan for Messrs. Woodring, Atkinson,
16
Lay and Schuster, which totaled $4,400 for 2006, and includes $19,828 paid
to Mr. Watson in lieu of an award under the RGA Reinsurance Company Profit
Sharing Plan, in which he is not eligible to participate.
5. This column represents the sum of the change in pension value in 2006 for
each of the named executive officers. We do not pay above-market or
preferential earnings on any account balance, therefore, this column does
not reflect any amounts relating to nonqualified deferred compensation
earnings. See the Pension Benefits and Nonqualified Deferred Compensation
Tables for additional information.
6. For Messrs. Woodring, Atkinson, Lay, and Schuster, amount includes profit
sharing and matching contributions made by RGA Reinsurance Company in 2006
to the officers' accounts in the RGA Reinsurance Company Profit Sharing
Plan and the RGA Reinsurance Company Augmented Benefit Plan. Amount for
Mr. Watson represent contributions made to his account by RGA
International under its retirement plan.
7. Represents Canadian $180,099 converted to US dollars using the spot
currency exchange rate of 0.857706 in effect on December 29, 2006, the
last business day of the 2006 fiscal year.
GRANTS OF PLAN-BASED AWARDS IN 2006
The following table provides information about equity and non-equity
awards granted to the named executive officers in 2006: (1) the grant date; (2)
the estimated future payouts under non-equity incentive plan awards, which
consist of potential payouts under the MIP award granted in 2006 for the 2006
performance period; (3) estimated future payouts under equity incentive plan
awards, which consist of potential payouts under the PCRS grants in 2006 for the
2006 - 2008 performance period; (4) all other option grants, which consist of
the number of shares underlying stock options granted to the named executive
officers in 2006; (5) the exercise price of the stock options granted, which
reflects the closing price of RGA stock on the date of grant, and (6) the grant
date fair value of each equity grant computed under SFAS 123R.
- ------------------------------------------------------------------------------------------------------------------------------------
ALL OTHER ALL OTHER
STOCK OPTION
ESTIMATED FUTURE PAYOUTS ESTIMATED FUTURE PAYOUTS AWARDS: AWARDS: EXERCISE
UNDER NON-EQUITY UNDER EQUITY INCENTIVE PLAN NUMBER NUMBER OF OR BASE
INCENTIVE PLAN AWARDS(1) AWARDS (NUMBER OF SHARES)(2) OF SHARES SECURITIES PRICE OF
GRANT -------------------------------------------------------------------- OF STOCK UNDERLYING OPTION
NAME DATE THRESHOLD TARGET MAXIMUM THRESHOLD TARGET MAXIMUM OR UNITS OPTIONS(3) AWARDS(4)
- ------------------------------------------------------------------------------------------------------------------------------------
Woodring 2/21/2006 0 $700,000 $1,400,000 -- -- -- -- -- --
-- -- -- 0 15,998 31,996 -- -- --
-- -- -- -- -- -- -- 37,911 $47.48
- ------------------------------------------------------------------------------------------------------------------------------------
Lay 2/21/2006 0 $316,000 $ 632,000 -- -- -- -- -- --
-- -- -- 0 4,777 9,554 -- -- --
-- -- -- -- -- -- -- 11,321 $47.48
- ------------------------------------------------------------------------------------------------------------------------------------
Atkinson 2/21/2006 0 $336,000 $ 672,000 -- -- -- -- -- --
-- -- -- 0 4,777 9,554 -- -- --
-- -- -- -- -- -- -- 11,321 $47.48
- ------------------------------------------------------------------------------------------------------------------------------------
Schuster 2/21/2006 0 $316,000 $ 632,000 -- -- -- -- -- --
-- -- -- 0 4,777 9,554 -- -- --
-- -- -- -- -- -- -- 11,321 $47.48
- ------------------------------------------------------------------------------------------------------------------------------------
Watson 2/21/2006 0 $360,000 $ 720,000 -- -- -- -- -- --
-- -- -- 0 7,000 14,000 -- -- --
-- -- -- -- -- -- -- 11,321 $47.48
- ------------------------------------------------------------------------------------------------------------------------------------
- --------------------------
GRANT DATE
FAIR VALUE
OF STOCK
AND OPTION
NAME AWARDS(5)
- --------------------------
Woodring --
$759,585
$608,851
- --------------------------
Lay --
$226,812
$181,815
- --------------------------
Atkinson --
$226,812
$181,815
- --------------------------
Schuster --
$226,812
$181,815
- --------------------------
Watson --
$332,360
$181,815
- --------------------------
- -------------
1. These columns reflect the potential value of the payment for 2006
performance under the MIP for each named executive if the threshold,
target or maximum goals are satisfied for both performance measures. The
potential payments are performance-driven and therefore completely at
risk. The performance measurements, salary and bonus multiples for
determining the payments are described in the CD&A. The 2007 bonus payment
for 2006 performance has been made based on the metrics described at
approximately 135 percent of target, and is shown in the Summary
Compensation Table in the column titled "Non-Equity Incentive Plan
Compensation."
2. This column reflects the number of PCRS units granted in 2006, which will
convert into shares of RGA stock at the end of the three-year performance
period if RGA achieves the specified performance. The performance period
commenced January 1, 2006 and ends December 31, 2008. If the "trigger" is
not met, no award will be made. If the minimum level of performance is
met, the award of shares starts at 50% (target is 100% and maximum is
200%). See discussion of MIP and ITB awards in CD&A.
3. This column reflects the number of stock options granted in 2006 to the
named executive officers. These options vest and become exercisable in
four equal annual installments of 25%, beginning on December 31, 2007.
4. This column reflects the exercise price per share of common stock for the
stock options granted, which is the closing price of the common stock on
February 21, 2006, the date the Compensation Committee approved the grant.
17
5. This column reflects the full grant date fair value of PCRS units under
SFAS 123R and the full grant date fair value of stock options under SFAS
123R granted to the named executive officers in 2006. Generally, the full
grant date fair value is the amount that we would expense in our financial
statements over the award's vesting schedule. See note 2 of the Summary
Compensation Table for a discussion of fair value calculation related to
the PCRS. For stock options, fair value is calculated using the
Black-Scholes value on the date of grant of $16.06. For PCRS units, fair
value is calculated using the closing price of RGA stock on the grant date
of $47.48. The fair value shown for stock awards and option awards are
accounted for in accordance with SFAS 123R. For additional information on
the valuation assumptions, refer to note 17 of RGA's financial statements
in the Form 10-K for the year ended December 31, 2006, as filed with the
SEC. These amounts reflect our accounting expense, and do not correspond
to the actual value that will be recognized by the named executive
officers. For example, the PCRS units are subject to specified performance
objectives over the performance period, with one-third tied to growth in
revenue and two-thirds tied to growth in operating earnings. In addition,
the value of options, if any, realized by the optionee will not be
determined until exercise.
SALARY AND NON-EQUITY INCENTIVE PLAN COMPENSATION.
Salaries paid to our named executive officers are set forth in the 2006
Summary Compensation Table. For 2006, salaries paid to our named executive
officers accounted for the following percentages of their total compensation:
Mr. Woodring (14.5%), Mr. Lay (22.4%), Mr. Atkinson (20.9%), Mr. Schuster
(22.9%), and Mr. Watson (19.3%).
Non-equity incentive plan compensation paid to our named executive
officers also is set forth in the 2006 Summary Compensation Table. For 2006,
non-equity incentive plan compensation paid to our named executive officers
accounted for the following percentages of their total compensation: Mr.
Woodring (19.8%), Mr. Lay (24.9%), Mr. Atkinson (23.0%), Mr. Schuster (24.4%),
and Mr. Watson (22.3%).
INTERMEDIATE-TERM INCENTIVE AWARDS
The Compensation Committee approved grants of target awards of PCRS on
February 21, 2006. The grants were made pursuant to the terms of the Flexible
Stock Plan and a grant agreement. The Compensation Committee has established as
performance goals annual operating earnings (net income from continuing
operations less realized capital gains and losses and certain other
non-operating items) per share and annual consolidated revenues. At the
beginning of each three-year performance period, the Compensation Committee
grants to each named Executive Officer a target award of shares of our common
stock. The Compensation Committee also sets performance levels with a minimum,
target and maximum levels of performance. If we do not meet the minimum
performance goals, the restricted stock will not be awarded, and if we exceed
those performance goals, the award can be as much as 200% of the targeted award
opportunity. Grants of performance-contingent restricted stock are not treated
as outstanding shares until the performance goals are met and awards are made,
as determined and approved by the Compensation Committee. Awards are made in
shares of fully-vested, unrestricted common stock. The awards also are
contingent upon the recipient's continued employment with us at the end of the
three-year performance period.
STOCK OPTIONS
The options become exercisable in 25% increments on each of December 31,
2007, 2008, 2009 and 2010. Vesting will be accelerated upon the officer's death
or disability and upon a change in control of us (as such terms are defined in
the Flexible Stock Plan and option agreements). All stock option grants were
approved by the Compensation Committee on February 21, 2006.
EMPLOYMENT AGREEMENTS. None of the named executive officers have written
employment agreements with us.
18
OUTSTANDING EQUITY AWARDS AT 2006 FISCAL YEAR-END
The following table provides information on the 2006 year-end holdings of
stock options, restricted stock and PCRS by our named executive officers. This
table also includes unexercised and unvested option awards, unvested restricted
stock and unvested PCRS grants with performance conditions that have not yet
been satisfied. Each equity grant is shown separately for each named executive.
The vesting schedule for each grant is described in the footnotes following this
table, based on the option or stock award grant date. The market value of the
stock awards is based on the closing market price of RGA stock as of December
29, 2006, the last business day of the year, which was $55.70. The PCRS grants
are subject to specified performance objectives over the performance period,
with 67% tied to growth in operating earnings per share and 33% tied to growth
in consolidated revenues. For additional information about the option awards and
stock awards, see the description of equity incentive compensation in the CD&A.
A. GREIG WOODRING, PRESIDENT AND CEO
- -------------------------------------------------------------------------------------------------------------------------
OPTION AWARDS STOCK AWARDS
- -------------------------------------------------------------------------------------------------------------------------
EQUITY
INCENTIVE PLAN
AWARDS: NUMBER MARKET
NUMBER OF OF SHARES VALUE OF
NUMBER OF SECURITIES SECURITIES OR UNITS SHARES OR
UNDERLYING UNEXERCISED UNDERLYING OF STOCK UNITS OF
OPTIONS UNEXERCISED OPTION OPTION THAT STOCK THAT
GRANT --------------------------------- UNEARNED EXERCISE EXPIRATION HAVE NOT HAVE NOT
DATE EXERCISABLE(1) UNEXERCISABLE OPTIONS PRICE DATE VESTED(2) VESTED
- -------------------------------------------------------------------------------------------------------------------------
1/1/1998 31,994 $26.33 1/1/2008
1/1/1998 15,000 $835,500
- -------------------------------------------------------------------------------------------------------------------------
1/1/1999 25,261 $36.00 1/1/2009
- -------------------------------------------------------------------------------------------------------------------------
1/1/2000 49,596 $23.19 1/1/2010
- -------------------------------------------------------------------------------------------------------------------------
1/1/2001 67,086 $29.81 1/1/2011
- -------------------------------------------------------------------------------------------------------------------------
1/1/2002 56,157 14,040 $31.91 1/1/2012
- -------------------------------------------------------------------------------------------------------------------------
1/29/2003 49,248 32,833 $27.29 1/29/2013
- -------------------------------------------------------------------------------------------------------------------------
1/28/2004 17,167 17,168 $39.61 1/28/2014
- -------------------------------------------------------------------------------------------------------------------------
1/27/2005 7,373 22,119 $47.47 1/27/2015
1/27/2005
- -------------------------------------------------------------------------------------------------------------------------
2/21/2006 37,911 $47.48 2/21/2016
2/21/2006
- -------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------
STOCK AWARDS
- ----------------------------------------------
EQUITY INCENTIVE PLAN
AWARDS
--------------------------
MARKET OR
PAYOUT
NUMBER OF VALUE OF
UNEARNED UNEARNED
SHARES, SHARES,
UNITS OR UNITS OR
OTHER OTHER
RIGHTS THAT RIGHTS THAT
GRANT HAVE NOT HAVE NOT
DATE VESTED(3) VESTED(3)
- ----------------------------------------------
1/1/1998
1/1/1998
- ----------------------------------------------
1/1/1999
- ----------------------------------------------
1/1/2000
- ----------------------------------------------
1/1/2001
- ----------------------------------------------
1/1/2002
- ----------------------------------------------
1/29/2003
- ----------------------------------------------
1/28/2004
- ----------------------------------------------
1/27/2005
1/27/2005 24,892 $1,386,484
- ----------------------------------------------
2/21/2006
2/21/2006 15,998 $891,089
- ----------------------------------------------
19
JACK B. LAY, SENIOR EXECUTIVE VICE PRESIDENT AND CFO
- ----------------------------------------------------------------------------------------------------------------------------
OPTION AWARDS STOCK AWARDS
- ----------------------------------------------------------------------------------------------------------------------------
EQUITY
INCENTIVE PLAN
AWARDS: NUMBER MARKET
NUMBER OF OF SHARES VALUE OF
NUMBER OF SECURITIES SECURITIES OR UNITS SHARES OR
UNDERLYING UNEXERCISED UNDERLYING OF STOCK UNITS OF
OPTIONS UNEXERCISED OPTION OPTION THAT STOCK THAT
GRANT --------------------------------- UNEARNED EXERCISE EXPIRATION HAVE NOT HAVE NOT
DATE EXERCISABLE(1) UNEXERCISABLE OPTIONS PRICE DATE VESTED(2) VESTED
- ----------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------
1/1/1999 6,548 $364,724
- ----------------------------------------------------------------------------------------------------------------------------
1/1/2001 19,287 $29.81 1/1/2011
- ----------------------------------------------------------------------------------------------------------------------------
1/1/2002 15,356 3,839 $31.91 1/1/2012
- ----------------------------------------------------------------------------------------------------------------------------
1/29/2003 16,215 10,810 $27.29 1/29/2013
- ----------------------------------------------------------------------------------------------------------------------------
1/28/2004 6,075 6,075 $39.61 1/28/2014
- ----------------------------------------------------------------------------------------------------------------------------
1/27/2005 2,633 7,900 $47.47 1/27/2015
1/27/2005
- ----------------------------------------------------------------------------------------------------------------------------
2/21/2006 11,321 $47.48 2/21/2016
2/21/2006
- ----------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------
STOCK AWARDS
- --------------------------------------------
EQUITY INCENTIVE PLAN
AWARDS
---------------------------
MARKET OR
PAYOUT
NUMBER OF VALUE OF
UNEARNED UNEARNED
SHARES, SHARES,
UNITS OR UNITS OR
OTHER OTHER
RIGHTS THAT RIGHTS THAT
GRANT HAVE NOT HAVE NOT
DATE VESTED(3) VESTED(3)
- --------------------------------------------
- --------------------------------------------
1/1/1999
- --------------------------------------------
1/1/2001
- --------------------------------------------
1/1/2002
- --------------------------------------------
1/29/2003
- --------------------------------------------
1/28/2004
- --------------------------------------------
1/27/2005
1/27/2005 8,890 $495,173
- --------------------------------------------
2/21/2006
2/21/2006 4,777 $266,079
- --------------------------------------------
DAVID B. ATKINSON, EXECUTIVE VICE PRESIDENT AND COO
- -------------------------------------------------------------------------------------------------------------------------
OPTION AWARDS STOCK AWARDS
- -------------------------------------------------------------------------------------------------------------------------
EQUITY
INCENTIVE PLAN
AWARDS: NUMBER MARKET
NUMBER OF OF SHARES VALUE OF
NUMBER OF SECURITIES SECURITIES OR UNITS SHARES OR
UNDERLYING UNEXERCISED UNDERLYING OF STOCK UNITS OF
OPTIONS UNEXERCISED OPTION OPTION THAT STOCK THAT
GRANT --------------------------------- UNEARNED EXERCISE EXPIRATION HAVE NOT HAVE NOT
DATE EXERCISABLE(1) UNEXERCISABLE OPTIONS PRICE DATE VESTED(2) VESTED
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
1/1/1999 15,158 $36.00 1/1/2009
1/1/1999 6,548 $364,724
- -------------------------------------------------------------------------------------------------------------------------
1/1/2001 29,350 $29.81 1/1/2011
- -------------------------------------------------------------------------------------------------------------------------
1/1/2002 23,064 5,767 $31.91 1/1/2012
- -------------------------------------------------------------------------------------------------------------------------
1/29/2003 20,886 13,925 $27.29 1/29/2013
- -------------------------------------------------------------------------------------------------------------------------
1/28/2004 7,290 7,290 $39.61 1/28/2014
- -------------------------------------------------------------------------------------------------------------------------
1/27/2005 3,160 9,480 $47.47 1/27/2015
1/27/2005
- -------------------------------------------------------------------------------------------------------------------------
2/21/2006 11,321
2/21/2006 $47.48 2/21/2016
- -------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------
STOCK AWARDS
- ------------------------------------------------
EQUITY INCENTIVE PLAN
AWARDS
--------------------------
MARKET OR
PAYOUT
NUMBER OF VALUE OF
UNEARNED UNEARNED
SHARES, SHARES,
UNITS OR UNITS OR
OTHER OTHER
RIGHTS THAT RIGHTS THAT
GRANT HAVE NOT HAVE NOT
DATE VESTED(3) VESTED(3)
- ------------------------------------------------
- ------------------------------------------------
1/1/1999
1/1/1999
- ------------------------------------------------
1/1/2001
- ------------------------------------------------
1/1/2002
- ------------------------------------------------
1/29/2003
- ------------------------------------------------
1/28/2004
- ------------------------------------------------
1/27/2005
1/27/2005 10,668 $594,208
- ------------------------------------------------
2/21/2006
2/21/2006 4,777 $266,079
- ------------------------------------------------
20
PAUL A. SCHUSTER, SENIOR EXECUTIVE VICE PRESIDENT - U.S. OPERATIONS
- ---------------------------------------------------------------------------------------------------------------------------
OPTION AWARDS STOCK AWARDS
- ---------------------------------------------------------------------------------------------------------------------------
EQUITY
INCENTIVE PLAN
AWARDS: NUMBER MARKET
NUMBER OF OF SHARES VALUE OF
NUMBER OF SECURITIES SECURITIES OR UNITS SHARES OR
UNDERLYING UNEXERCISED UNDERLYING OF STOCK UNITS OF
OPTIONS UNEXERCISED OPTION OPTION THAT STOCK THAT
GRANT --------------------------------- UNEARNED EXERCISE EXPIRATION HAVE NOT HAVE NOT
DATE EXERCISABLE(1) UNEXERCISABLE OPTIONS PRICE DATE VESTED(2) VESTED
- ---------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
1/1/1999 9,377 $36.00 1/1/2009
- ---------------------------------------------------------------------------------------------------------------------------
1/1/2000 17,251 $23.19 1/1/2010
- ---------------------------------------------------------------------------------------------------------------------------
1/1/2001 18,029 $29.81 1/1/2011
- ---------------------------------------------------------------------------------------------------------------------------
1/1/2002 16,609 4,153 $31.91 1/1/2012
- ---------------------------------------------------------------------------------------------------------------------------
1/29/2003 15,115 10,077 $27.29 1/29/2013
- ---------------------------------------------------------------------------------------------------------------------------
1/28/2004 6,075 6,075 $39.61 1/28/2014
- ---------------------------------------------------------------------------------------------------------------------------
1/27/2005 2,633 7,900 $47.47 1/27/2015
1/27/2005
- ---------------------------------------------------------------------------------------------------------------------------
2/21/2006 11,321 $47.48 2/21/2016
2/21/2006
- ---------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------
STOCK AWARDS
- -----------------------------------------------
EQUITY INCENTIVE PLAN
AWARDS
---------------------------
MARKET OR
PAYOUT
NUMBER OF VALUE OF
UNEARNED UNEARNED
SHARES, SHARES,
UNITS OR UNITS OR
OTHER OTHER
RIGHTS THAT RIGHTS THAT
GRANT HAVE NOT HAVE NOT
DATE VESTED(3) VESTED(3)
- -----------------------------------------------
- -----------------------------------------------
1/1/1999
- -----------------------------------------------
1/1/2000
- -----------------------------------------------
1/1/2001
- -----------------------------------------------
1/1/2002
- -----------------------------------------------
1/29/2003
- -----------------------------------------------
1/28/2004
- -----------------------------------------------
1/27/2005
1/27/2005 8,890 $495,173
- -----------------------------------------------
2/21/2006
2/21/2006 4,777 $266,079
- -----------------------------------------------
GRAHAM WATSON, SENIOR EXECUTIVE VICE PRESIDENT - INTERNATIONAL
- ------------------------------------------------------------------------------------------------------------------------
OPTION AWARDS STOCK AWARDS
- ------------------------------------------------------------------------------------------------------------------------
EQUITY
INCENTIVE PLAN
AWARDS: NUMBER MARKET
NUMBER OF OF SHARES VALUE OF
NUMBER OF SECURITIES SECURITIES OR UNITS SHARES OR
UNDERLYING UNEXERCISED UNDERLYING OF STOCK UNITS OF
OPTIONS UNEXERCISED OPTION OPTION THAT STOCK THAT
GRANT --------------------------------- UNEARNED EXERCISE EXPIRATION HAVE NOT HAVE NOT
DATE EXERCISABLE(1) UNEXERCISABLE OPTIONS PRICE DATE VESTED(2) VESTED
- ------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------
1/1/1999 10,616 $36.00 1/1/2009
- ------------------------------------------------------------------------------------------------------------------------
1/1/2001 17,778 $29.81 1/1/2011
- ------------------------------------------------------------------------------------------------------------------------
1/1/2002 13,788 3,448 $31.91 1/1/2012
- ------------------------------------------------------------------------------------------------------------------------
1/29/2003 13,379 18,198 $27.29 1/29/2013
- ------------------------------------------------------------------------------------------------------------------------
1/28/2004 6,075 6,075 $39.61 1/28/2014
- ------------------------------------------------------------------------------------------------------------------------
1/27/2005 2,633 7,900 $47.47 1/27/2015
1/27/2005
- ------------------------------------------------------------------------------------------------------------------------
2/21/2006 11,321
2/21/2006 $47.48 2/21/2016
- ------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------
STOCK AWARDS
- -------------------------------------------------
EQUITY INCENTIVE PLAN
AWARDS
---------------------------
MARKET OR
PAYOUT
NUMBER OF VALUE OF
UNEARNED UNEARNED
SHARES, SHARES,
UNITS OR UNITS OR
OTHER OTHER
RIGHTS THAT RIGHTS THAT
GRANT HAVE NOT HAVE NOT
DATE VESTED(3) VESTED(3)
- -------------------------------------------------
- -------------------------------------------------
1/1/1999
- -------------------------------------------------
1/1/2001
- -------------------------------------------------
1/1/2002
- -------------------------------------------------
1/29/2003
- -------------------------------------------------
1/28/2004
- -------------------------------------------------
1/27/2005
1/27/2005 14,000 $779,800
- -------------------------------------------------
2/21/2006
2/21/2006 7,000 $389,900
- -------------------------------------------------
21
- -------------
1. Options with a grant date from 1998 through 2003 vest and become
exercisable in five equal annual installments of 20%, on December 31 of
the first, second, third, fourth and fifth years following the grant.
Options granted in 2004 and subsequent years vest and become exercisable
in four equal annual installment of 25%, on December 31 of the second,
third, fourth and fifth calendar years following the year of the grant.
2. Mr. Woodring was granted 15,000 shares of restricted stock effective
January 1, 1998, which vest on January 1, 2008. Messrs. Lay and Atkinson
were granted 6,548 shares of restricted stock effective January 1, 1999,
which vest on January 1, 2009.
3. These columns reflect the number of shares and estimated market value of
grants of PCRS. In February 2007, the Compensation Committee determined
that the 2004 PCRS award would be made at the maximum level, or 200% of
target. In accordance with SEC rules, the number of shares and estimated
market value for the PCRS grants made in 2005 are disclosed assuming they
are awarded at the maximum (200%) level, and the amounts for the PCRS
grants made in 2006 are disclosed assuming they are awarded at target
(100%) level. The market or payout value is estimated using the closing
price, $55.70, of our common stock on December 29, 2006, the last business
day of the year. The performance period for the 2005 PCRS grant is January
1, 2005 through December 31, 2007. The performance period for the 2006
PCRS grant is January 1, 2006 through December 31, 2008.
OPTION EXERCISES AND STOCK VESTED DURING FISCAL 2006
The following table provides information, for the named executive
officers, on (1) stock option exercises during 2006, including the number of
shares acquired upon exercise and the value realized, and (2) the number of
shares awarded for the PCRS grants in 2004 (three-year performance period ending
December 31, 2006) and the value realized, each before payment of any applicable
withholding tax and broker commissions.
- ---------------------------------------------------------------------------------
OPTION AWARDS STOCK AWARDS
- ---------------------------------------------------------------------------------
NUMBER OF NUMBER OF
SHARES ACQUIRED VALUE REALIZED SHARES ACQUIRED VALUE REALIZED
NAME ON EXERCISE ON EXERCISE ON VESTING ON VESTING
- ---------------------------------------------------------------------------------
Woodring(1) 36,900 $ 1,155,782 28,980 $ 1,614,766
- ---------------------------------------------------------------------------------
Lay(2) 46,419 $ 1,093,014 10,260 $ 571,687
- ---------------------------------------------------------------------------------
Atkinson(3) 29,111 $ 931,988 12,300 $ 685,356
- ---------------------------------------------------------------------------------
Schuster(4) 7,880 $ 188,072 10,260 $ 571,687
- ---------------------------------------------------------------------------------
Watson(5) -- -- 14,000 $ 780,080
- ---------------------------------------------------------------------------------
- -------------
1. Mr. Woodring exercised 36,900 options on August 18, 2006, with an exercise
price of $20.28 and a market price for 27,000 shares he sold of $51.60.
Mr. Woodring retained the remaining 9,900 shares. He acquired 28,980
shares with a market price of $55.72 on March 8, 2007, the payout date for
the 2004 PCRS grant.
2. Mr. Lay exercised 46,419 options on August 11, 2006, with exercise prices
as follows: 3,100 @ $20.28; 14,003 @ $26.33; 10,340 @ $36.00; and 18,976 @
$23.19. The market price for 34,600 shares he sold was $50.34. Mr. Lay
retained the remaining 11,819 shares. He acquired 10,260 shares with a
market price of $55.72 on March 8, 2007, the payout date for the 2004 PCRS
grant.
3. Mr. Atkinson exercised 29,111 options on November 29, 2006, with an
exercise price of $23.19. He sold 15,000 of the shares at a market price
of $55.22 and 14,111 shares at a market price of $55.18. He acquired
12,300 shares with a market price of $55.72 on March 8, 2007, the payout
date for the 2004 PCRS grant.
4. Mr. Schuster exercised 7,880 options on August 10, 2006, with an exercise
price of $26.33 and a market price for 5,595 shares he sold of $50.20. Mr.
Schuster retained the remaining 2,285 shares. He acquired 10,260 shares
with a market price of $55.72 on March 8, 2007, the payout date for the
2004 PCRS grant.
5. Mr. Watson acquired 14,000 shares with a market price of $55.72 on March
8, 2007, the payout date for the 2004 PCRS grant.
22
PENSION BENEFITS IN FISCAL 2006
Some of our employees participate in the RGA Performance Pension Plan (the
"Pension Plan"), a qualified defined benefit plan. Some of our employees also
participate in the RGA Reinsurance Company Augmented Benefit Plan (the "RGA
Augmented Plan"), a non-qualified plan under which eligible employees are
entitled to additional retirement benefits not paid under the Pension Plan and
the RGA Profit Sharing Plan due to Internal Revenue Code limits on the amount of
benefits that may accrue and be paid under the Pension Plan and the RGA Profit
Sharing Plan.
Messrs. Woodring, Atkinson, Lay and Schuster participate in the Pension
Plan and the RGA Augmented Plan. The monthly benefit payable for life at age 65
for each individual is the sum of (a) and (b) below:
(a) The sum of (1) 1.05% of Final Average Monthly Compensation,
multiplied by the number of years of service earned as of December
31, 1995, plus (2) .65% of the excess, if any, of Final Average
Monthly Compensation minus one-twelfth of the Social Security
Maximum Wage Average, multiplied by the number of years of service
earned as of December 31, 1995; plus
(b) The actuarial equivalent of a lump sum benefit equal to the sum of
the amounts determined below for each full year of service completed
after December 31, 1995:
AGE ON JANUARY 1 OF THE PLAN PERCENTAGE OF FINAL
YEAR IN WHICH THE YEAR OF SERVICE AVERAGE ANNUAL PERCENTAGE OF EXCESS
IS EARNED COMPENSATION CREDITED COMPENSATION CREDITED
Up to 35 2% 1%
35 - 44 4% 2%
45 - 54 6% 3%
55 or over 8% 4%
Social Security Maximum Wage Average means the average of the Social
Security Wage Bases in effect for each calendar year during the 35-year period
ending with the calendar year in which a participant attains the Social Security
retirement age. Social Security Wage Base means the maximum amount of
compensation that may be considered wages for FICA tax, or $94,200 for 2006.
Breakpoint means 60% of the Social Security Wage Base raised to the next highest
$100 increment. Excess Compensation means the excess, if any, of Final Average
Annual Compensation minus the Breakpoint. Final Average Annual Compensation
means the highest average Benefit Salary for the five consecutive years during
the preceding ten years. Benefit Salary means actual base salary, eligible
bonuses and pre-tax salary deferrals made to the profit sharing plan or a
cafeteria plan and the CODA portion of the profit sharing award. Final Average
Monthly Compensation is one-twelfth of Final Average Annual Compensation.
Mr. Watson is not eligible to participate in the Pension Plan or the RGA
Augmented Plan, however, he participates in a pension plan sponsored by the
Canadian government. Payment of the specified retirement benefits is contingent
upon continuation of the plans in their present form until the officer retires.
We maintain a Canadian Supplemental Executive Retirement Plan for RGA
International Corporation, a non-qualified defined benefit plan pursuant to
which eligible executive officers are entitled to receive additional retirement
benefits. Mr. Watson participates in this plan.
Until January 1, 1994, we also maintained an Executive Supplemental
Retirement Plan (the "RGA Supplemental Plan"), a non-qualified defined benefit
plan pursuant to which eligible executive officers are entitled to receive
additional retirement benefits. Benefits under the RGA Supplemental Plan were
frozen as of January 1, 1994. The frozen annual benefit payable upon retirement
at age 65 is $36,719 for Mr. Woodring and $7,770 for Mr. Atkinson. Retirement
benefits under the RGA Supplemental Plan are
23
payable at age 65 in the form of a 15-year certain life annuity, with no direct
or indirect integration with Social Security benefits.
- --------------------------------------------------------------------------------------------------
NUMBER OF PAYMENTS
YEARS PRESENT VALUE DURING
CREDITED OF ACCUMULATED LAST FISCAL
NAME PLAN NAME SERVICE BENEFIT(1) YEAR
- --------------------------------------------------------------------------------------------------
Performance Pension Plan 27 $ 487,467 --
Woodring Augmented Benefit Plan 27 $ 2,546,484 --
Supplemental Plan [__] $ [_____]
- --------------------------------------------------------------------------------------------------
Performance Pension Plan 15 $ 228,173 --
Lay Augmented Benefit Plan 15 $ 314,441 --
- --------------------------------------------------------------------------------------------------
Performance Pension Plan 19 $ 306,193
Atkinson Augmented Benefit Plan 19 $ 664,307 --
Supplemental Plan [__] $ [_____] --
- --------------------------------------------------------------------------------------------------
Performance Pension Plan 15 $ 228,777 --
Schuster Augmented Benefit Plan 15 $ 312,131 --
- --------------------------------------------------------------------------------------------------
RGA International Supplemental Executive 11 $ 1,133,887(2) --
Watson Retirement Plan
- --------------------------------------------------------------------------------------------------
- -------------
1. The accumulated benefit is based on service and compensation (as
described above) considered by the plans for the period through December
31, 2006. The present value has been calculated assuming the earliest
retirement age at which the participant can elect an unreduced benefit.
For additional discussion of the assumptions, see note 9 of RGA's
financial statements in the Form 10-K for the year ended December 31,
2006, as filed with the SEC. As described in such note, the interest
assumption is 5.75%.
2. Represents Canadian $1,322,000 converted to US dollars using the spot
currency exchange rate of 0.857706 in effect on December 29, 2006, the
last business day of the 2006 fiscal year.
NONQUALIFIED DEFERRED COMPENSATION IN FISCAL 2006
The table below provides information on the non-qualified deferred
compensation of the named executive officers in 2006. Employees who hold the
office of vice president and above are able to defer up to 50% of their base
salary and up to 100% of their cash bonus payments under our Executive Deferred
Savings Plan (EDSP). With respect to distributions, participants may elect to
receive either a lump sum payment or 1 to 15 annual installments. In addition,
we also maintain the RGA Augmented Plan, a non-qualified plan under which
eligible employees are entitled to receive profit sharing and matching
contributions not paid to the employee under the RGA Profit Sharing and 401(k)
Plan due to Internal Revenue Code limits or a reduction in compensation pursuant
to the employee's participation in the EDSP. The contributions made into the
employee's non-qualified deferred compensation account are based upon the
maximum matching contribution rate we provide to other employees in connection
with our profit sharing and 401(k) savings plan.
The investment fund alternatives under the RGA Augmented Plan and EDSP
mirror those in our profit sharing plan/401(k), and we credit the participant's
non-qualified deferred compensation account(s) with the returns he or she would
have received in accordance with the investment alternatives selected from time
to time by the participant. We do not pay above-market or preferential earnings,
compensation or returns under the EDSP or Augmented Plan.
The named executive officers cannot withdraw any amounts from their
deferred compensation balances until they either terminate employment or reach
the designated distribution date selected by the executive at the time of their
deferral election (in the case of benefits held in the executive's EDSP
account). No withdrawals or distributions were made in 2006.
24
- ---------------------------------------------------------------------------------------
EXECUTIVE REGISTRANT AGGREGATE AGGREGATE AGGREGATE
CONTRIBUTIONS CONTRIBUTIONS EARNINGS IN WITHDRAWALS/ BALANCE
NAME IN LAST FY(1) IN LAST FY(1) LAST FY(2) DISTRIBUTIONS AT LAST FYE(3)
- ---------------------------------------------------------------------------------------
Woodring -- $ 7,385 $ 29,320 -- $ 239,708
- ---------------------------------------------------------------------------------------
Lay $ 41,312 $ 15,679 $ 47,672 -- $ 394,989
- ---------------------------------------------------------------------------------------
Atkinson $ 5,529 $ 18,118 $ 297,665 -- $ 1,925,218
- ---------------------------------------------------------------------------------------
Schuster -- $ 11,652 $ 14,672 -- $ 111,798
- ---------------------------------------------------------------------------------------
Watson -- -- -- -- --
- ---------------------------------------------------------------------------------------
- -------------
1. The amounts in this column are also included in the Summary Compensation
Table in the salary or other compensation columns (i.e., contributions to
the RGA Reinsurance Company Augmented Benefit Plan).
2. Reflects earnings credited to the participant's account during 2006 in
connection with the investment selections chosen from time to time by the
participant.
3. All of the executive and registrant contributions for 2006 are reported in
the Summary Compensation Table. In addition, the aggregate balance at last
fiscal year-end column reflects the following amounts that were reported
in the Summary Compensation Table in previous years: Woodring, $[____];
Lay, $[____]; Atkinson, $[____]; and Schuster, $[____].
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE OF CONTROL
As described in the CD&A, our named executive officers do not have
employment, severance or change of control agreements with our Company. The
information below describes and quantifies certain compensation that may or will
become payable under existing plans and agreements if the named executive
officer's employment had terminated on December 31, 2006, given his or her
compensation and service levels as of such date and, where applicable, based on
our closing stock price on that date. These benefits are in addition to benefits
available generally to salaried employees such as distributions under the 401(k)
and pension plans, retiree medical benefits, disability benefits and accrued
vacation pay.
Change of Control. Upon the occurrence of a change of control (as defined
below), any unvested stock options granted before the date of that event could
become exercisable if the Compensation Committee decided to maintain the named
executive officer's rights following a change in control. Our stock option grant
agreements provide that the Compensation Committee may accelerate the vesting
periods or arrange for us to purchase the options so the named executive officer
receives the value that he or she would have attained had the option been
currently exercisable. In addition, our PCRS grant agreement provides that upon
a change of control, as soon as practicable following the end of the applicable
three-year performance period, we must deliver to the named executive officer
the number of shares that coincides with the target award for each outstanding
grant of PCRS.
Disability or Death. If one of the named executive officers were to become
disabled or die, any unvested stock options granted before the date of such
event would immediately vest and become exercisable. In addition, he or she
would receive a pro rata proportion of the shares of common stock that would
have been issued underunderlying fully vested stock options) are deemed to be outstanding for the purposes of computing the percentage ownership of such person or group but are not deemed to be outstanding for the purposes of computing the percentage ownership of any award of PCRS at the end of the three-year
performance period. The pro rata proportion is determined based on the number of
calendar months in the performance period during which heother person or she was employed,
divided by 36 months (the total number of months in the three-year performance
period).
Retirement. Upon the "retirement" (as defined below) of agroup. No director, nominee or named executive officer unvested stock options do not accelerate but continue to vest in
accordance with the vesting schedule and provisions specified in the respective
option grant agreement(s). Upon his or her retirement, the pro rata distribution
provisions described above under "Disability or Death" apply to any PCRS grants.
Due to the number of factors that affect the nature, amount and timingowns more than one percent of the vesting and exercise of stock options, or the actual
25
award following a PCRS performance period, the amounts paid to or receivedCompany’s outstanding common stock. Beneficial Ownership by the named executive officer may differCompany’s Executive Officers and are undeterminable until actually
realized.
The named executive officers may participate in deferred compensation
plans that permit deferralDirectors
Beneficial Ownership of certain compensation. They also participate in our
defined contribution and defined benefit retirement plans. The last columnEquity Securities
| | | | | | | | | | | | | | | | | | | | | |
| | | Class A Common Stock | | | Class B Common Stock | | | Percentage
| |
| | | Number of
| | | Percent of
| | | Number of
| | | Percent of
| | | of Total
| |
| | | Shares
| | | Class A
| | | Shares
| | | Class B
| | | Common
| |
| | | Beneficially
| | | Common
| | | Beneficially
| | | Common
| | | (Both Classes of
| |
Name | | Owned(1) | | | Stock | | | Owned(1) | | | Stock | | | Common Stock) | |
| |
| David B. Atkinson | | | 148,597 | (2) | | | * | | | | — | | | | * | | | | * | |
| William J. Bartlett | | | 5,500 | | | | * | | | | — | | | | * | | | | * | |
| J. Cliff Eason | | | 18,750 | (3) | | | * | | | | — | | | | * | | | | * | |
| Stuart I. Greenbaum | | | 24,633 | (4) | | | * | | | | — | | | | * | | | | * | |
| Alan C. Henderson | | | 12,996 | (5) | | | * | | | | — | | | | * | | | | * | |
| Jack B. Lay | | | 80,231 | (6) | | | * | | | | — | | | | * | | | | * | |
| Paul A. Schuster | | | 91,211 | (7) | | | * | | | | — | | | | * | | | | * | |
| Graham Watson | | | 148,268 | (8) | | | * | | | | — | | | | * | | | | * | |
| A. Greig Woodring | | | 444,824 | (9) | | | * | | | | — | | | | * | | | | * | |
| All directors and executive officers as a group (11 persons) | | | 1,045,335 | (10) | | | 3.2 | % | | | — | | | | * | | | | 1.7 | % |
| | |
| * | | Number of shares represents less than one percent of
the Nonqualified Deferred Compensation Table reports each named executive's
aggregate balance at December 31, 2006, under each nonqualified deferred
compensation or defined contribution plan. The named executive officers are
entitled to receive the amount in their deferred compensation account in the
event of termination of employment or retirement. The Pension Benefits Table
describes the general terms of each pension plan in which the named executive
officers participate, the years of credited service and the present value of
each named executive officer's accumulated pension benefit.
Definitions. "Change of control" is defined in our Flexible Stock Plan
and, for this discussion, means (i) the acquisition, without Board approval, of
more than twenty percent (20%) of our outstanding common shares through a tender
offer, exchange offer or otherwise, (ii) the liquidation or dissolution of our
following a sale or other disposition of all or substantially all of its assets,
(iii) a merger or consolidation involving us which results in our Company not
being the surviving corporation, or (iv) a change in the majority of the members
of the Board of Directors during any two-year period not approved by at least
two-thirds of the Directors who were members at the beginning of the two-year
period.
"Retirement" is defined in the respective equity incentive grant
agreements and means disability, death or termination of employment due to
retirement of a named executive officer who has attained a combination of age
and years of service that equals at least sixty-five (65), provided that, the
maximum number of years of service considered for this calculation is ten (10).
Thus, named executive officers who attain age 55 and have 10 years of service
(which at December 31, 2006 includes Messrs. Woodring and Watson) satisfy the
definition and are eligible for the benefits described above associated with
retirement.
The following table provides the value of equity awards that would
accelerate and become exercisable or vested upon the occurrence of a change of
control or if the named executive officer had become disabled or died as of
December 31, 2006. The value calculations are based upon our stock price as of
December 29, 2006 ($55.70), the last business day of the year, and in the case
of options reflect the payment of the respective option exercise price.
- ----------------------------------------------------------------------------------------
CHANGE OF CONTROL DISABILITY OR DEATH
-------------------------------------------------------------
PCRS PCRS
NAME OPTIONS (FULL AWARD AT TARGET) OPTIONS (PRO RATA)
- ----------------------------------------------------------------------------------------
Woodring $2,036,698 $ 1,584,331 $2,036,698 $ 759,191
- ----------------------------------------------------------------------------------------
Lay $ 654,264 $ 513,665 $ 654,264 $ 253,751
- ----------------------------------------------------------------------------------------
Atkinson $ 821,181 $ 563,183 $ 821,181 $ 286,762
- ----------------------------------------------------------------------------------------
Schuster $ 640,910 $ 513,665 $ 640,910 $ 253,751
- ----------------------------------------------------------------------------------------
Watson $ 854,855 $ 779,800 $ 854,855 $ 389,900
- ----------------------------------------------------------------------------------------
DIRECTOR COMPENSATION FOR FISCAL 2006
Directors who also serve as officers of our Company, MetLife, or any
subsidiaries of such companies do not receive any additional compensation for
serving our Company as members of the Board of Directors or any of our
committees. During 2006 this group of directors consisted of Messrs. Launer,
Reali, and Woodring, and Ms. Weber. Effective January 1, 2005, the Board
established compensation for directors who are not employees of our Company,
MetLife, or any subsidiaries of such companies ("non-employee directors"), and
that compensation arrangement continued in 2006. In 2006, non-employee directors
were paid an annual retainer fee of $50,000 (except the chair of the Audit
Committee, who received an annual
26
retainer fee of $62,000, and the chair of any other Committee, who received an
annual retainer fee of $58,000). Non-employee directors were paid $3,000 for
each Board and Committee meeting attended in person, and $1,500 for
participating in a telephonic Board or Committee meeting. If applicable, a
non-employee director serving as Chairman of the Board would receive an annual
retainer of $83,000, a $4,000 fee for each Board meeting attended in person and
$2,000 for participating in a telephonic Board meeting, and an annual grant of
1,600 shares of stock. We also reimburse directors for out-of-pocket expenses
incurred in connection with attending Board and Committee meetings. Mr. Bartlett
also serves as a director of our Australian holding and operating companies, and
receives an annual retainer of AUS $52,500 and superannuation pension benefits
AUS $4,725 for those services.
During 2006, the group of non-employee directors consisted of Messrs.
Bartlett, Eason, Greenbaum and Henderson. Each non-employee director is issued
1,200 shares of stock effective on the date of the February Board meeting.
Non-employee directors may elect to receive phantom shares in lieu of
their annual retainer (including the stock portion) and meeting fees. A phantom
share is a hypothetical share of our common stock based upon the fair market
value of the common stock at the time of the grant. Phantom shares are not
distributed until the director ceases to be a director by reason of retirement
as a director, at which time we will issue cash or shares of common stock in an
amount equal to the value of the phantom shares.
All such stock and options are issued pursuant to the Flexible Stock Plan
for Directors, which was amended and restated at the annual meeting held May 28,
2003. Phantom shares are granted under the Phantom Stock Plan for Directors,
which was last amended at the annual meeting held May 28, 2003.
- -----------------------------------------------------------------------------------------------------------------------
CHANGE IN
PENSION
VALUE AND
NONQUALIFIED
FEES EARNED NON-EQUITY DEFERRED
OR PAID IN STOCK OPTION INCENTIVE PLAN COMPENSATION ALL OTHER
NAME CASH(1) AWARDS(2) AWARDS(3) COMPENSATION EARNINGS COMPENSATION TOTAL
- -----------------------------------------------------------------------------------------------------------------------
William J. Bartlett $ 120,500 $ 56,976 -- -- -- $ 43,117(4) $ 220,593
- -----------------------------------------------------------------------------------------------------------------------
J. Cliff Eason $ 108,500 $ 56,976 -- -- -- -- $ 165,476
- -----------------------------------------------------------------------------------------------------------------------
Stuart I. Greenbaum $ 118,000 $ 56,976 -- -- -- -- $ 174,976
- -----------------------------------------------------------------------------------------------------------------------
Alan C. Henderson $ 118,000 $ 56,976 -- -- -- -- $ 174,976
- -----------------------------------------------------------------------------------------------------------------------
- -------------
1. This column reflects the amountnumber of compensation earned in 2006 for Board
and committee service.
2. This column reflectsshares of the award of 1,200 sharesclass or classes (as applicable) of common stock on
February 21, 2006,outstanding at a closing market price of $47.48. The aggregate
grant date fair value computed in accordance with FAS 123R is $56,976.
The stock is issued as part of the directors' annual compensation. We
ceased granting shares of restricted stock to directors in 2005, however,
800 shares of the final grant on January 27, 2005 were unvested as of
December 31, 2006 (400 of those shares vested January 1, 2007, and the
remaining 400 vest January 1, 2008).
3. We ceased granting stock options to directors in 2003. The following
directors have outstanding option awards at 2006 fiscal year-end: Eason -
10,500; Greenbaum - 17,933; and Henderson - 6,000.
4. Represents compensation for services as a director of our Australian
holding and operating companies. Converted to U.S. dollar amount using
the average AUD/USD exchange rate for 2006.
SECURITIES OWNERSHIP OF DIRECTORS, MANAGEMENT AND CERTAIN BENEFICIAL OWNERS
OWNERSHIP OF SHARES OF RGA
--------------------------
The following table sets forth, as of February 1, 2007, certain
information with respect to: (1) each person known by us to be the beneficial
owner of 5% or more of our outstanding common stock, and (2) the
27
ownership of common stock by (i) each of our directors and nominees, (ii) each
of our named executive officers, and (iii) all directors, nominees, and
executive officers as a group.
AMOUNT AND NATURE OF PERCENT OF
BENEFICIAL OWNER(2) BENEFICIAL OWNERSHIP(1) CLASS(2)
- ------------------- -------------------- -----
SIGNIFICANT SHAREHOLDERS:
MetLife, Inc.
200 Park Avenue
New York, New York 10166-0188 32,243,539(3) 52.5%
Barclay's Global Investors, NA
45 Fremont Street
San Francisco, CA 94105 3,343,911(4) 5.5%
Wellington Management Company, LLP
75 State Street
Boston, Massachusetts 02109 3,360,768(5) 5.5%
- -------------------------------------------------------------------------------------------------------
DIRECTORS, NOMINEES AND NAMED EXECUTIVE OFFICERS:
A. Greig Woodring, Director,
President and Chief Executive Officer 389,355(6)
William J. Bartlett, Director 3,100(7)
J. Cliff Eason, Director 16,350(8)
Stuart Greenbaum, Director 22,233(9)
Alan C. Henderson, Director 10,596(10)
Steven A. Kandarian, Director(3) --
Joseph A. Reali, Director(3) --
Georgette A. Piligian, Director(3) --
David B. Atkinson,
Executive Vice President and Chief Operating Officer 148,185(11)
Jack B. Lay,
Senior Executive Vice President and Chief Financial Officer 92,174(12)
Paul A. Schuster,
Senior Executive Vice President - U.S. Operations 114,461(13)
Graham Watson,
Senior Executive Vice President - International 111,668(14)
All directors and executive officers as a group (14 persons) 961,359(15) 1.55%
- -------------
1. September 30, 2008. | | (1) | | Unless otherwise indicated, each named person has sole voting and investment power over the shares listed as beneficially owned. None of the shares held by directors, nominees or named executive officers are pledged as security.
28
2. For purposes | | | (2) | | Includes for Mr. Atkinson 113,077 shares of this table, "beneficial ownership" is determinedclass A common stock subject to stock options that are exercisable within 60 days and 28,972 shares of class A common stock for which he shares voting and investment power with his spouse. Also includes 6,548 restricted shares of class A common stock that are subject to forfeiture in accordance with Rule 13d-3 under the Securities Exchange Actterms of 1934,the specific grant, as
amended ("Exchange Act"), pursuant to which a person or groupMr. Atkinson has no investment power. |
4
| | | | (3) | | Includes for Mr. Eason 8,250 shares of persons
is deemedclass A common stock subject to have "beneficial ownership"stock options that are exercisable within 60 days. | | | (4) | | Includes for Mr. Greenbaum 13,433 shares of anyclass A common stock subject to stock options that are exercisable within 60 days. | | | (5) | | Includes for Mr. Henderson 6,000 shares of class A common stock subject to stock options that are exercisable within 60 days. | | | (6) | | Includes for Mr. Lay 44,233 shares of class A common stock subject to stock options that are exercisable within 60 days and 16,816 shares of class A common stock for which Mr. Lay shares voting and investment power with his spouse. Also includes 6,548 restricted shares of class A common stock that suchare subject to forfeiture in accordance with the terms of the specific grant, as to which Mr. Lay has no investment power. | | | (7) | | Includes for Mr. Schuster 63,162 shares of class A common stock subject to stock options that are exercisable within 60 days, and 22,238 shares of class A common stock for which Mr. Schuster shares voting and investment power with his spouse. | | | (8) | | Includes for Mr. Watson 94,415 shares of class A common stock subject to stock options that are exercisable within 60 days and 6,187 shares of class A common stock owned by Intercedent Limited, a Canadian corporation of which Mr. Watson has a majority ownership interest. | | | (9) | | Includes for Mr. Woodring 344,195 shares of class A common stock subject to stock options that are exercisable within 60 days. | | | (10) | | Includes a total of 738,222 shares of class A common stock subject to stock options that are exercisable within 60 days and 13,096 shares of restricted class A common stock that are subject to forfeiture in accordance with the terms of the specific grant, as to which the holder has no investment power. |
Beneficial Ownership by Five Percent Shareholders Beneficial Ownership of Equity Securities | | | | | | | | | | | | | | | | | | | | | | | | | Class A Common Stock | | | Class B Common Stock | | | Percentage
| | | | | Number of
| | | Percent of
| | | Number of
| | | Percent of
| | | of Total
| | | | | Shares
| | | Class A
| | | Shares
| | | Class B
| | | Common
| | | | | Beneficially
| | | Common
| | | Beneficially
| | | Common
| | | (Both Classes of
| | Name | | Owned(1) | | | Stock | | | Owned(1) | | | Stock | | | Common Stock)(2) | | | | | MetLife, Inc.(3) | | | 3,000,000 | (3) | | | 9.0 | % | | | — | | | | — | | | | 4.8 | % | 200 Park Avenue
New York, NY10166-0188 | | | | | | | | | | | | | | | | | | | | | | Wellington Management Company, LLP(4) | | | 4,870,951 | (4) | | | 14.7 | % | | | | | | | | | | | 7.8 | % | 75 State Street
Boston, MA 02109 | | | | | | | | | | | | | | | | | | | | | | Capital Ventures International(5) | | | | | | | | | | | 2,757,872 | (5) | | | 9.4 | % | | | 4.4 | % | One Capitol Place
P.O. Box 1787 GT Grand Cayman, Cayman Islands British West Indies | | | | | | | | | | | | | | | | | | | | | | Affiliates of Davidson Kempner Partners(6) | | | | | | | | | | | 1,850,189 | (6) | | | 6.3 | % | | | 3.0 | % | 65 E 55th St,
19th Fl New York, NY 10022 | | | | | | | | | | | | | | | | | | | | |
| | | | (1) | | Unless otherwise indicated, each named person has sole voting and investment power over the right to acquire within 60 days. For computingshares listed as beneficially owned. | | | (2) | | Percentages based on the percentagenumbers of shares of the class of securities heldreported as beneficially owned by each person or group of
persons named above, any shares which such person or persons has the right
to acquire within 60 days (as well as the shares of common stock
underlying fully vested stock options) are deemed to be outstanding for
the purposes of computing the percentage ownership of such person or group
but are not deemed to be outstanding for the purposes of computing the
percentage ownership of any other person or group. No director, nominee or
named executive officer owns more than one percent of our outstanding
common stock.
3. The amount in the table reflects the total beneficial ownership of
MetLife, Metropolitan Life, GenAmerica Financial, LLC, and General
American Life Insurance Company and contained inreporting person. | | | (3) | | As reported on a Schedule 13D/A filed withSeptember 17, 2008 by MetLife, Inc. and certain of its subsidiaries (which we refer to collectively as “MetLife”). Pursuant to a recapitalization and distribution agreement between MetLife, Inc. and RGA dated as of June 1, 2008, MetLife, Inc. agreed that, until the Securities60th day |
5
| | | | | following the completion of a recapitalization and Exchange Commissionsplit-off (which took place on April 25, 2005. EachSeptember 12, 2008), MetLife would not sell, exchange, pledge or otherwise transfer or dispose of its 3,000,000 shares of class A common stock. It also agreed that MetLife would thereafter sell, exchange or otherwise dispose of such 3,000,000 shares of class A common stock within 60 months of the filing companies shares votingcompletion of the recapitalization and dispositive power with each other. Mr.
Kandarian issplit-off. | | | | Additionally, MetLife, Inc. and certain of its subsidiaries have granted an executive officer,irrevocable proxy to the Company and Mr. Reali and Ms. Piligian are
seniorcertain officers of MetLife. Each of them disclaims beneficial ownershipthe Company and its designees to vote in any election of the Company’s directors, the 3,000,000 shares beneficially owned by MetLifeof class A common stock in proportion to the other holders of that class, and, its subsidiaries.
4. As reported on a Schedule 13G filed January 23, 2007, Shares are ownedin all other matters, in proportion to the votes cast by the reporting personother holders of class A common stock and in accounts managed by Barclays Global Fund
Advisors, an investment advisor. The reporting group has sole voting power
over 2,947,341 shares and sole dispositive power over all of its shares.
5. class B common stock, taken together as a whole. | | | (4) | | As reported on a Schedule 13G/A filed February 14, 2007.2008, Wellington Management Company, LLP ("WMC"(“WMC”) is an investment adviser.advisor. Shares are owned of record by clients of WMC, none of which is known to have beneficial ownership of more than five percent of our outstanding shares. WMC has shared voting power of 2,337,1263,584,626 shares of class A common stock and shared dispositive power of 3,340,568 shares.
6. Includes 334,3384,842,151 shares of class A common stock subjectstock. | | | (5) | | As reported on a Schedule 13G filed September 26, 2008, Susequehanna Advisors Group, Inc. (“Susequehanna”) 401 City Avenue, Suite 220 Bala Cynwyd, PA 19004, is the investment manager to stock options that are
exercisable within 60 days. Also includes 15,000 shares of restricted
common stock that are subject to forfeiture in accordance with the terms
of the specific grant,Capital Ventures International (“Capital”) and as to which Mr. Woodring has no investment power.
7. Includes 400 restricted shares of common stock that are subject to
forfeiture in accordance with the terms of the specific grant, as to which
Mr. Bartlett has no investment power.
8. Includes 10,500 shares of common stock subject to stock options that are
exercisable within 60 days. Also includes 400 restricted shares of common
stock that are subject to forfeiture in accordance with the terms of the
specific grant, as to which Mr. Eason has no investment power.
9. Includes 17,933 shares of common stock subject to stock options that are
exercisable within 60 days. Also includes 400 restricted shares of common
stock that are subject to forfeiture in accordance with the terms of the
specific grant, as to which Mr. Greenbaum has no investment power.
10. Includes 6,000 shares of common stock subject to stock options that are
exercisable within 60 days. Also includes 400 restricted shares of common
stock that are subject to forfeiture in accordance with the terms of the
specific grant, as to which Mr. Henderson has no investment power.
11. Includes 111,637 shares of common stock subject to stock options that are
exercisable within 60 days and 30,000 shares for which Mr. Atkinson sharessuch may exercise voting and investment power with his spouse. Also includes 6,548
restricted shares of common stock that are subject to forfeiture in
accordance with the terms of the specific grant, as to which Mr. Atkinson
has no investment power.
12. Includes 68,810 shares of common stock subject to stock options that are
exercisable within 60 days and 16,816 shares for which Mr. Lay shares
voting and investment power with his spouse. Also includes 6,548
restricted shares of common stock that are subject to forfeiture in
accordance with the terms of the specific grant, as to which Mr. Lay has
no investment power.
13. Includes 94,280 shares of common stock subject to stock options that are
exercisable within 60 days, and 20,181 shares for which Mr. Schuster
shares voting and investment power with his spouse.
14. Includes 76,816 shares of common stock subject to stock options that are
exercisable within 60 days and 6,187 shares owned by Intercedent Limited,
a Canadian corporation of which Mr. Watson has a majority ownership
interest.
15. Includes a total of 763,527 shares of common stock subject to stock
options that are exercisable within 60 days; and 29,696 shares of
restricted common stock that are subject to forfeiture in accordance with
the terms of the specific grant, as to which the holder has no investment
power.
|
OWNERSHIP OF SHARES OF METLIFE
------------------------------
The following table sets forth, as of February 1, 2007, certain
information with respect to the following individuals to the extent they own
shares of common stock of MetLife, our parent: (i) each of our directors and
nominees; (ii) each of our executive officers; and (iii) all directors,
nominees, and executive officers as a group.
29
PERCENT
BENEFICIAL OWNER AMOUNT AND NATURE OF BENEFICIAL OWNERSHIP(1) OF CLASS
- ---------------- ----------------------------------------- --------
DIRECT INDIRECT (2)
------ ------------
Steven A. Kandarian, Director 11,667(3) -- *
Joseph A. Reali, Director 120,506(4) 170(5) *
Georgette A. Piligian, Director 62,784(6) 20(7) *
A. Greig Woodring, Director, President & CEO 90 -- *
Jack B. Lay, Senior EVP and CFO 200(8) -- *
David B. Atkinson, EVP and COO -- -- *
Paul A. Schuster, Senior EVP - U.S. Operations 200(8) -- *
Graham Watson, Senior EVP - International -- -- *
All directors and executive officers as a group (14 persons) 195,447(9) 190 *
- -------------
* Less than one percent.
1. Unless otherwise indicated, each named person has sole voting and
investmentdispositive power over the shares. Susequehanna has shared voting and dispositive power for 2,757,872 shares listedof class B common stock. | | (6) | | As reported on a Schedule 13G filed October 2, 2008, Davidson Kempner Advisers Inc. (“DKAI”) is the general partner of Davidson Kempner International Partners, L.P. (“DKIP”), DKAI is registered as an investment advisor with the SEC, DKIA is the manager of Davidson Kempner International, Ltd. (“DKIL”), Messrs. Thomas L. Kempner, Jr., Marvin H. Davidson, Stephen M. Dowicz, Scott E. Davidson, Michael J. Leffell, Timothy I. Levart, Robert J. Brivio, Jr., Anthony A. Yoseloff, Eric P. Epstein, Avram Z. and Conor Bastable (collectively, the “Principals”) are the general partners of M. H. Davidson & Co. (“CO”) and MHD Management Co. (“MHD”), the sole managing members of Davidson Kempner International Advisors (“DKIA”) and the sole stockholders of DKAI. The Principals may be deemed to beneficially owned.
2. Unless otherwise noted, representsown an aggregate of 1,850,189 shares held through the MetLife
Policyholder Trust, which has soleas a result of their voting and dispositive power over suchthe 1,850,189 shares beneficially owned by Davidson Kempner Partners (“DKP”), DKIP, DKIL and CO. DKIA may be deemed to beneficially own the 969,499 shares beneficially owned by DKIL as a result of its voting and dispositive power over those shares. 3. Includes 11,667DKAI may be deemed to beneficially own the 568,008 shares beneficially owned by DKIP as a result of MetLifeits voting and dispositive power over those shares. MHD may be deemed to beneficially own the 283,079 shares beneficially owned by DKP as a result of its voting and dispositive power over those shares. |
6
PROPOSAL ONE: CONVERSION OF THE COMPANY’S DUAL CLASS COMMON STOCK
STRUCTURE INTO A SINGLE CLASS COMMON STOCK STRUCTURE Our board of directors has authorized, and recommends for approval, the conversion of the Company’s dual class common stock structure into a single class common stock structure. Pursuant to the conversion, our class B common stock will be converted into our class A common stock on a one-for-one basis. In order for the conversion proposal to be approved, it must receive the affirmative vote of the holders of both: | | | | • | a majority of the class A common stock subjectrepresented in person or by proxy and entitled to stock options
that are exercisable within 60 days'.
4. Includes 99,178 sharesvote at the special meeting; and | | | • | a majority of MetLifethe class B common stock subjectrepresented in person or by proxy and entitled to stock options
that are exercisable within 60 days, and 18,328 deferred share units
payable in shares of MetLife common stock under MetLife's Deferred
Compensation Plan for Officers.
5. Includes 10 shares jointly held with Mr. Reali's spouse with whom Mr.
Reali shares investment power.
6. Includes 54, 542 shares of MetLife common stock subject to stock options
that are exercisable within 60 days and 8,142 deferred share units payable
in shares of MetLife common stock under MetLife's Deferred Compensation
Plan for Officers.
7. Includes 20 shares jointly held with Ms. Piligian's spouse, with whom she
shares investment power.
8. Includes 200 shares of MetLife common stock subject to stock options that
are exercisable within 60 days.
9. Includes a total of 165,787 shares of MetLife common stock subject to
stock options that are exercisable within 60 days and 26,470 deferred
share units payable in shares of MetLife common stock under MetLife's
Deferred Compensation Plan for Officers.
vote at the special meeting. |
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires our directors, executive
officers, and persons who beneficially own more than ten percent of a registered
classBackground of our equity securities, to file reports of ownership and changes in
ownership on Forms 3, 4 and 5 with the SECDual Class Structure and the NYSE. Directors, executive
officers, and greater than 10% shareholders are required by SEC regulation to
furnish us with copies of all Forms 3, 4, and 5 they file.
Based solely on our review of the copies of such forms we have received or
that were filed wit the SEC, or written representations from certain reporting
persons, we believe that all our directors, executive officers, and greater than
10% beneficial owners complied with all filing requirements applicable to them
with respect to transactions during 2006.
CERTAIN RELATIONSHIPS AND RELATED PERSON TRANSACTIONS
Review and Approval of Related Person Transactions. We do not have any
agreements, transactions or relationships with related persons such as
directors, nominees, executive officers, or immediate family members of such
individuals. At least annually we review all relationships between ourConversion Proposal The Company and our directors and executive officers and their immediate family members to
determine whether such persons havehas had a direct or indirect material interest in
any transaction with us. Our legal staff is primarily responsible for the
development and implementation of processes and controls to obtain information
from the directors, nominees and executive officers with respect to related
person transactions. If such a transaction arose, our legal staff would
determine, based on the facts and circumstances, whether we or a related person
has a direct or indirect material interest in the transaction. As required under
SEC rules, related person transactions that are determined to be directly or
indirectly material to us are disclosed in our proxy statement and other SEC
filings.dual class common stock structure since September 12, 2008. The current related person transactions to which we or our subsidiaries
are parties are reinsurance agreements, administrative service agreements, and a
product license with MetLife, our majority shareholder. The charges for
reinsurance, administrative and corporate services and the license fee are based
on arms-length negotiations and pricing that we believe is comparable to the
fees that would be charged to our other clients or incurred for services
provided by a third party vendor. Any agreements between RGA Reinsurance
Company, our primary operating company which is a Missouri insurance company,
and another subsidiary or
30
affiliate of MetLife, must be filed for review and approval by the Missouri
Department of Insurance ("MDOI"). The MDOI requires that the fees be fair,
reasonable and less than or equal to the cost for such services from a third
party.
In July 2002, our Board of Directors adopted a policy that requires
advance approval from the Board before any director knowingly enters into any
contract, arrangement, understanding, relationship or transaction with our
Company or any of its subsidiaries or affiliates through which the director, a
member of the director's family, or any entity or organization affiliated with
the director, receives any direct or indirect financial, economic, or other
similar benefit.
On January 6, 2000, MetLife acquired 100% of GenAmerica Financial
Corporation, our predecessor parent, including its beneficial ownership of RGA
shares, whichdual class structure was approximately 48% at December 31, 1999. This acquisition,
together with direct investments in our Company in 1999, 2002 and 2003, made
MetLife our majority shareholder with beneficial ownership of approximately
52.5% of all outstanding shares as of February 1, 2007. Currently, three of our
eight directors are executives or senior officers of MetLife.
Reinsurance Business. We have arms-length direct policies and reinsurance
agreements with MetLife and some of its affiliates. Under these agreements, we
had net premiums of approximately $227.8 million in 2006, $226.7 million in 2005
and $164.4 million in 2004. The net premiums reflect the net business assumed
from and ceded to such affiliates of MetLife. Our pre-tax income (loss),
excluding interest income allocated to support the business, was approximately
$10.9 million in 2006, ($11.3) million in 2005, $22.4 million in 2004. Our
reinsurance treaties with MetLife are generally terminable by either party on 90
days written notice, but only with respect to future new business; existing
business generally is not terminable, unless the underlying policies terminate
or are recaptured. Under these treaties, MetLife is permitted to reassume all or
a portion of the risk formerly ceded us after an agreed-upon period of time, or
in some cases, due to changes in our financial condition or ratings. Recapture
of business previously ceded does not affect premiums ceded prior to the
recapture of such business, but would reduce premiums in subsequent periods.
Registration Rights. On November 24, 2003, our Company, MetLife,
Metropolitan Life, General American and Equity Intermediary Company, which is
now dissolved, entered into a registration rights agreement, which superseded
then existing agreements with General American and Equity Intermediary Company.
Under the terms of the agreement, MetLife and its affiliates were entitled,
subject to certain limitations and conditions, to "piggyback" and demand
registration rights and we were required to bear certain expenses associated
with the registration of any shares held by MetLife or its affiliates. In March
2005, we registered the shares held by MetLife on a Form S-3 registration
statement, which was renewed in a Form S-3 filing in February 2006. We paid a
registration fee to the SEC of approximately $173,200created in connection with the original registration, and incurred certain other legal and accounting expenses
to register the shares. Although thedivestiture by our former majority shareholder, MetLife, shares are now registered, various
other provisions of the agreement remain operable.
Administrative Services. General American Life Insurance Company, which is
referred to as "General American," and MetLife have historically provided our
CompanyInc. and its subsidiary, RGA Reinsurance Company, with certain limited
administrative services, suchsubsidiaries (which we refer to collectively as corporate risk management and corporate travel
services. The cost“MetLife”), of these services was approximately $2.5 million in 2006,
$1.7 million in 2005 and $1.0 million in 2004.
Effective January 1, 1997, General American entered into an administrative
services agreement with RGA Reinsurance Company whereby General American
provides services necessary to handle the policy and treaty administration
functions for certain bank-owned life insurance policies. RGA Reinsurance
Company paid General American approximately $30,000 in 2005 and $385,000 in
2004. The agreement has been terminated and no amounts were paid in 2006.
Product License Agreement. RGA Reinsurance Company has a product license
and service agreement with MetLife, which is terminable by either party on 30
days notice. Under this agreement, we
31
have licensed the use29,243,539 shares of our electronic underwriting product to MetLife and
provide Internet hosting services, installation and modification services for
the product. Revenue under this agreement from MetLife was approximately $0.7
million in 2006, $1.6 million in 2005 and $3.5 million in 2004.
INDEPENDENT AUDITOR
Deloitte & Touche LLP ("Deloitte") wasclass B common stock. On September 5, 2008, our independent auditing firm for
the fiscal year ended December 31, 2006, and we expect to select this firm again
for the year ending December 31, 2007. A representative of Deloitte is expected
to be present at the 2007 Annual Meeting to respond to appropriate questions and
to makeshareholders held a statement if he or she so desires.
The aggregate fees billed to us for the fiscal years ending December 31,
2006 and 2005 by our principal accounting firm, Deloitte & Touche, LLP, the
member firms of Deloitte Touche Tohmatsu, and their respective affiliates
(collectively, the "Deloitte Entities") are as follows:
FISCAL YEAR
2006 2005
Audit Fees(a) $3,704,455 $3,250,971
Audit Related Fees(b) 380,834 412,762
---------- ----------
Total audit and audit-related fees 4,085,289 3,663,733
Tax Fees(c) 192,278 231,399
All Other Fees(d) 14,273 0
---------- ----------
Total Fees $4,291,840 $3,895,132
========== ==========
- -------------
a. Includes fees for the audit of our Company's and its subsidiaries' annual
financial statements, reviews of our quarterly financial statements, and
Sarbanes-Oxley Section 404 attestation.
b. Includes fees for services rendered by the Deloitte Entities for matters
such as employee benefit plan audits, assistance with internal control
reporting requirements, and services associated with SEC registration
statements, periodic reports and securities offerings.
c. Includes fees for tax services rendered by the Deloitte Entities, such as
consultation related to tax planning and compliance.
d. De minimis fees for other types of permitted services.
All audit related services, tax services and other services were
pre-approved by the Audit Committee, which concludedspecial meeting. At that the provision of such
services by the Deloitte Entities was compatible with the maintenance of that
firm's independence in the conduct of its auditing functions. The Audit
Committee has adopted a Pre-Approval Policy which provides for pre-approval of
audit, audit-related and tax services on an annual basis and, in addition,
individual engagements anticipated to exceed pre-established thresholds must be
separately approved. The policy authorizes the Committee to delegate to one or
more of its members pre-approval authority with respect to permitted services.
32
AUDIT COMMITTEE REPORT
The Audit Committee has reviewed and discussed our 2006 audited financial
statements with management. The Audit Committee also discussed with the
independent accountants the matters required to be discussed by SAS 61
(Codification of Statements on Auditing Standard, AU 380). The Audit Committee
has received the written disclosures and the letter from the independent
accountants required by Independence Standards Board Standard No. 1, and has
discussed with those accountants their independence. Based on those reviews and
discussions, the Audit Committee recommended to our Board of Directors that the
audited financial statements be included in our Annual Report on Form 10-K for
the fiscal year ended December 31, 2006, for filing with the SEC. This report is
provided by the following independent directors, who comprise the Committee:
William J. Bartlett, Chairman
J. Cliff Eason
Stuart I. Greenbaum
Alan C. Henderson
- --------------------------------------------------------------------------------
ITEM 2 - APPROVAL OF AMENDMENT TO THE FLEXIBLE STOCK PLAN
- --------------------------------------------------------------------------------
The second item to be acted upon at the Annual Meeting is a proposal to
approve an amendment to our Flexible Stock Plan ("Plan") to increase the number
of shares authorized for issuance under the Plan. The Board of Directors
originally adopted the Plan in February 1993 and, on March 31, 1993,meeting, our shareholders approved the Plan.recapitalization and distribution agreement between us and MetLife, Inc., including a recapitalization of our common stock and a related amendment and restatement of our articles of incorporation. In the recapitalization, which was completed on September 12, 2008, each issued and outstanding share of our common stock was reclassified as class A common stock. Immediately after this reclassification, MetLife exchanged each share of our class A common stock it held (other than 3,000,000 shares of class A common stock) with the Company for one share of our class B common stock. The Planrecapitalization was completed in conjunction with, and was conditioned upon, the completion of an offer by MetLife, Inc. to its stockholders (which we refer to as the “split-off”) to exchange all of the shares of our class B common stock for shares of MetLife, Inc. common stock. At the special meeting, our shareholders also approved proposals relating to: | | | | • | Class B Significant Holder Voting Limitation. A provision in our articles of incorporation that restricts the voting power with respect to directors of a holder of more than 15% of our outstanding our class B common stock to 15% of our outstanding our class B common stock;providedthat, if such holder also has in excess of 15% of our outstanding class A common stock, such holder of our class B common stock may exercise the voting power of the class B common stock in excess of 15% to the extent that such holder has an equivalent percentage of outstanding class A common stock (which we refer to as the “significant holder voting limitation”); | | | • | Acquisition Restrictions. A provision in our articles of incorporation that, subject to limited exceptions, restricts for a period until September 13, 2011, our shareholders from becoming a “5-percent shareholder” for purposes of Section 382 of the Internal Revenue Code and the related Treasury regulations and restrict any permitted 5-percent shareholder from further increasing its ownership interest in the Company; and | | | • | Section 382 Shareholder Rights Plan Proposal. The ratification of our special committee’s decision to adopt and implement an amended and restated Section 382 shareholder rights plan in connection with the recapitalization and MetLife’s divestiture. |
Lastly, at the special meeting, our shareholders approved the terms and conditions pursuant to which the conversion could be approved. Specifically, at the September 5, 2008 special meeting our shareholders
7
approved the conversion of our class B common stock into shares of our class A common stock, one a one-for-one basis, if: | | | | • | our board of directors adopts, in its discretion, a resolution submitting the potential conversion proposal to our shareholders; and | | | • | the holders of a majority of each class of our common stock represented in person or by proxy and entitled to vote and the meeting approve the conversion proposal. |
On September 12, 2008, we amended and restated effective July
1, 1998. On May 24, 2000our articles of incorporation and May 28, 2003, our shareholders approved amendments
tocompleted the Plan that increased the numberreclassification of shares under the Plan for which
options, stock appreciation rights, restricted stock, performance shares and
other stock based awards are granted. On May 26, 2004, our shareholders approved
an amendment to eliminate the "evergreen" provision that provided for an
automatic increase of 5% each year in the number of authorized shares available
for issuance under the Plan.
The Plan provides for the grant of stock options, stock appreciation
rights, restricted stock, performance shares and other stock based awards to our
employees, employees and owners of entities that have a direct or indirect
ownership interest in us or in which we have a direct or indirect ownership
interest, individuals who are employed by or owners of our client companies or
suppliers, and individuals who are employed by or owners of companies that
render services to us (collectively, the "Participants"). As of March 15, 2007,
approximately 156 employees currently participate in the Plan.
Under the Plan, a maximum of 6,260,077 shares are presently authorized for
issuance from treasury stock or authorized but unissued shares. As of March 15,
2007, equity-based awards to purchase or receive 3,320,719 shares of common
stock were granted to Participants andall then outstanding under the Plan, 2,810,859
shares have been exercised by, awarded to or received by Participants, and
3,449,218 shares are available for future grants. The amended Plan increases the
total number of shares authorized for issuance by 3,000,000, for a total of
9,260,077. The proposed amendment will amend Section 3.1 of the Plan, which, if
approved, will read as follows:
3.1 NUMBER OF SHARES. The number of Shares which may be issued or sold or
for which Options, SARs or Performance Shares may be granted under the
Plan shall be 9,260,077 Shares. Such Shares may be authorized but unissued
Shares, Shares held in the treasury, or both.
The Board of Directors believes that the increase in the number of shares
authorized for issuance under the amended Plan is appropriate and will enhance
our ability to continue to reward and provide incentives to our key employees as
well as to attract and retain qualified employees. Presently, the total number
of shares represented by equity-based awards granted and outstanding and shares
available for future
33
grants (if ultimately issued) represent approximately 5.6% of our current shares
outstanding under the current Plan. If the amendment is approved, the total
number of shares represented by equity-based awards granted and outstanding and
shares available for future grants (if ultimately issued) will represent
approximately 10.4% of our current shares outstanding.
The principal features of the Plan, as amended, are described below. This
description is subject to and qualified in its entirety by the full text of the
Plan, which was filed as Exhibit 10.12 to our Form 10-K for the year ended
December 31, 2003 (filed with the SEC on March 12, 2004), and incorporated
herein by reference. The Form 10-K and exhibits are available through our
website (www.rgare.com) or at the SEC website (www.sec.gov/edgar). Information
on our website does not constitute part of this proxy statement.
DESCRIPTION OF THE PLAN
The Plan provides for benefits to be awarded to eligible Participants in
the form of stock options, stock appreciation rights, restricted stock,
performance shares, cash awards and other stock based awards. If any benefit
expires or is terminated, surrendered, cancelled or forfeited, the shares
covered by such benefit will be added back to the shares available for use under
the Plan. In addition, shares delivered to us in payment of the exercise price
of an option will be available for use under the Plan.
If our stock is changed by reason of any stock dividend, spin-off,
split-up, spin-out, recapitalization, merger, consolidation, reorganization,
combination or exchange of shares, then the number and class of shares available
for benefits, the number of shares subject to any outstanding benefits and the
price thereof will be appropriately adjusted.
The Compensation Committee of the Board of Directors administers the Plan
(the "Committee"). The Committee consists of four of our outside directors. The
Committee, by majority action, is authorized to determine the individuals to
whom the benefits will be granted, the type and amount of such benefits and the
terms of the benefit grants, as well as to interpret the Plan and to make all
other determinations necessary or advisable for the administration of the Plan
to the extent not contrary to the provisions of the Plan. The Committee makes
its determinations under the Plan based upon the recommendations of our Chief
Executive Officer and management, information made available to the Committee
and its judgment as to the best interests of RGA and our shareholders. In
certain circumstances, the Committee may delegate all or any part of its
authority under the Plan to our employees or another committee.
Under the Plan, the Committee may award: (a) stock options exercisable
into shares of our common stock which mayand related preferred purchase rights as class A common stock and related preferred purchase rights. This reclassification was immediately followed by an exchange of class A common stock held by MetLife (other than 3,000,000 shares of class A common stock) for an equal number of shares of newly issued class B common stock and related preferred stock purchase rights. Following the recapitalization, MetLife, Inc. completed the split-off with MetLife’s stockholders, some of whom thereby exchanged all or may not qualify as incentivesome of their shares of MetLife common stock options within the meaning of Section 422 of the Internal Revenue Code, as
amended; (b) stock appreciation rights; (c) restrictedfor 29,243,539 shares of our class B common stock; (d) performance shares, (e) cash awards, and (f) otherstock. Since the completion of the recapitalization, our class A common stock based awards
and benefits. As provided inhas been trading on the Plan, the Committee has complete discretion to
determine the type and number of benefits granted to any Participant and the
terms and conditions that attach to each grant. Such terms and conditions are
not necessarily uniform among different Participants. The receipt by a
Participant of one type of grantNYSE under the Plan does not entitletrading symbol “RGA.A” and our class B common stock has been trading on the ParticipantNYSE under the symbol “RGA.B”. Since September 12, 2008 until October [ ], 2008, our class B common stock has traded on the NYSE at a discount to receipt of anyour class A common stock. The premium has fluctuated between [ ] and [ ]. In addition to the trading differentials, certain other type of grant. Payment for sharesissues with respect to the dual-class structure have arisen since adoption, including: investor confusion regarding the dual-class structure and certain institutional investors are believed to remain unable to invest in either class of common stock purchased upon exercisedue to the small amount of any option or any other benefit granted under the
Plan that requires payment by a Participant to uspublic float for each class. Further, we expect there will be made in cash, oran increased administrative burden associated with the consentdual-class structure. Additionally, during recent months, and particularly in recent weeks, there has been a significant increase in the volatility of the Committee,equity markets, which our board of directors believes has heightened the value to investors of having a larger public float and greater liquidity. This increased demand for liquidity is one factor the board reviewed as it decided to consider and recommend the conversion at this time. We have not issued any class B common stock since the recapitalization. Participants in our stock plans receive shares of class A common stock. Our board of directors has reviewed the dual class common stock structure. After consideration of the issues and upon consultation with senior management and its financial and legal advisors, our board of directors has determined that the conversion proposal is fair and in the bests interests of the Company and its shareholders, including holders of class A common stock and holders of class B common stock, viewed separately, and has authorized and recommended shareholder approval of the conversion proposal. Reasons for the Conversion In determining to approve the conversion and recommend the conversion proposal to our shareholders, our board of directors considered a number of factors, including the possible benefits that the Company and our shareholders may derive from each of the following: | | | | • | creation of a single class of stock with a larger number of shares outstanding and increased public float with greater liquidity; | | | • | the use of a single class of common stock as acquisition currency and for issuances to third parties; | | | • | reduction in investor confusion resulting from the dual-class structure; | | | • | a larger public float in one security makes it more likely that security would be included in any number of broader equity indices; |
8
| | | | • | reduced complexity in evaluating and implementing stock repurchase programs and equity incentive programs; | | | • | reduction in certain administrative expenses resulting from the dual class structure; | | | • | reduction in the complexity of corporate governance related to the election of directors by the holders of two separate classes; and | | | • | alignment of voting rights with the economic risks of ownership of our common stock. |
The board of directors also considered the following factors in connection with its approval of the conversion and recommendation of the conversion proposal: | | | | • | the holders of our class A common stock and holders of our class B common stock currently have the same economic rights, with the only material differences between the two classes consisting of the following differences in voting rights: (i) the special voting rights for the election of directors, (ii) the significant holder voting limitation, (iii) the class vote to approve the conversion proposal, and (iv) certain other limited matters required by Missouri law; | | | • | in any reorganization or in any merger, share exchange, consolidation or combination of the Company with any other company, holders of our class A common stock and our class B common stock are entitled to receive the same per share consideration (except for such differences as may be permitted with respect to their existing rights to elect directors); | | | • | the trading price and trading volume differentials of the class A common stock and class B common stock, taking into account recent market volatility and emergency limitations on certain short selling activities; | | | • | the historical trading price and trading volume differentials between the two classes of publicly traded stock of certain other companies with dual-class capital structures; | | | • | in our proxy statement/prospectus dated August 4, 2008 relating to our special meeting of shareholders on September 5, 2008, we disclosed that we expected that, following the recapitalization and split-off, our board of directors would consider the conversion proposal. However, we indicated that there was no binding commitment by our board of directors to, and there could be no assurance that our board of directors would, consider the issue or resolve to submit such a proposal to shareholders, and that there could be no assurance that shareholders would approve such a conversion; | | | • | the exchange ratios adopted by other companies that have eliminated their dual-class structures; | | | • | the extent to which the proposed conversion is consistent with certain representations, undertakings and statements made in connection with the private letter ruling that MetLife, Inc. received from the Internal Revenue Service in connection with MetLife’s divestiture of its ownership interest in the Company; | | | • | the holders of our class A common stock and our class B common stock will each have a class vote on the conversion proposal, and therefore will have an opportunity to decide for themselves whether the conversion should be implemented; and | | | • | the conversion is not expected to result in taxable income to the Company or to the holders of our class A common stock or class B common stock. |
This discussion of information and factors considered by the tenderboard of sharesdirectors is not intended to be exhaustive, but includes the material factors considered by the board of directors in making its decision. In view of the wide variety of factors considered by the board of directors in connection with its evaluation of the conversion proposal and the complexity of these matters, the board of directors did not consider it practicable to, nor did it attempt to quantify, rank or otherwise assign relative weights to the specific factors it considered in reaching its decision. In considering the factors described above, individual members of the board of directors may have given different weight to different factors. Although one of the potential benefits that our board considered was the administrative cost savings that may result from a simplified capital
9
structure, we cannot assure you that the conversion of our class B common stock having a
fair market value equalwill result in any material cost savings. We cannot assure you when or if any specific potential benefits considered by the board of directors will be realized. Conditions Precedent to Effectiveness of the Conversion The effectiveness of the proposed conversion of our class B common stock into our class A common stock is conditioned upon each of the following: | | | | • | approval of the conversion proposal by a majority of the class A common stock represented in person or by proxy and entitled to vote at the special meeting; | | | • | approval of the conversion proposal by a majority of the class B common stock represented in person or by proxy and entitled to vote at the special meeting; and | | | • | receipt of authorization to list (or to continue the listing of) the single new class of common stock on the NYSE. |
Approval of the conversion proposal is not conditioned upon approval of the charter proposal. The conversion will become effective at the earlier of (i) 5:00 p.m. St. Louis, Missouri time on the date an authorized official designated by the Company accepts the report of the inspector(s) of election or similar official or (ii) immediately prior to the purchase price,filing of the amended and restated articles of incorporation (if the charter proposal is approved) with the Secretary of State of the State of Missouri. Reservation of Rights by our Board of Directors Our board of directors reserves the right to abandon the adoption of the conversion without further action by our shareholders at any time before effectiveness of the conversion proposal (as described above), even if the conversion proposal has been approved by the shareholders at the special meeting and all other conditions to such adoption have been satisfied. Although the board of directors does not anticipate exercising its rights to abandon the conversion proposal nor does it contemplate specific events that would trigger abandonment, the board of directors will defer or abandon the conversion if, in other property, rights and
credits, toits business judgment, the extent permitted by law, or any combination of the foregoing.
Stock Options. The Committee may grant stock options, which entitle the
Participant to purchase ourclass A common stock at a price established byand the Committee,class B common stock is no longer in the best interests of the Company or its shareholders. By voting in favor of the conversion proposal, you will also be expressly authorizing the board to determine not to proceed with, and that price will not be less thanabandon, the Fair Market Valueconversion proposal if it should decide to do so. Certain Effects of the Conversion If the conversion is completed, each share of our outstanding class B common stock on the date of the grant. "Fair Market Value" means the closing
price of shares on the New York Stock Exchange on a given date. The Committee
determines the term of the stock options, including the times and conditions
under which the options become exercisable. The maximum number of shares with
respect to which incentive stock options are issuable under the Plan is 150,000
shares. The maximum number of shares with respect to which options maywill automatically be granted to any Participant in any one-year
34
period may not exceed 200,000 shares. For purposes of the preceding sentence,
shares of common stock covered by an option that is cancelled will count against
the maximum number of shares that may be granted to any Participant in any
one-year period, and if the exercise price under an option is reduced, the
transaction will be treated as a cancellation of the option and a grant of a new
option.
Stock Appreciation Rights ("SARs"). The Committee may grant SARs, which
gives the Participant a right to receive payment in an amount equal to the
appreciation, if any, in the Fair Market Value ofreclassified into a share from the date of the
grantour class A common stock. Pursuant to the date of its payment. Such payment is made in cash, in common stock
or in any combination of cash and common stock, as the Committee may determine.
The maximum number of SARs that may be granted to any Participant in any
one-year period is 15,000. For purposes of the preceding sentence, any SARs that
are cancelled will count against the maximum number of SARs that may be granted
to any Participant in any one-year period and if the fair market value of a
share on which appreciation under a SAR is calculated is reduced, the
transaction will be treated as a cancellation of the SAR and the grant of a new
SAR.
Restricted Stock. The Committee may grant benefits under the Plan in the
form of Restricted Stock. Shares of Restricted Stock are issued and delivered at
the time of the grant but are subject to forfeiture as provided in the grantee's
individual agreement. The grantee is entitled to full voting and dividend rights
with respect to all shares of Restricted Stock from the date of grant, but
cannot transfer such shares until all restrictions have been satisfied. Grants
are made at a per share cost equal to the par value.
Performance Shares. Performance Shares are the right of an individual to
whom a grant of such shares is made to receive shares or cash equal to the Fair
Market Value of such shares at a future date in accordance with the terms of our existing articles of incorporation, such grant. Generally, such right is based upon the attainment of targeted
profit and/or performance objectives.
Cash Awards. Cash Awards are benefits payable in cash. The Committee may
grant Cash Awards at such timesclass A common stock would thereafter be deemed to be redesignated as “common stock” (and which we refer to as our “new common stock”) and in such amounts as it deems appropriate.
Other Stock Based Awards. An Other Stock Based Award is an award that is
valued in whole or in part by reference to, or is otherwise based on, Company
common stock.
In the event of a "change in control" (as defined below) the Committee may
provide such protection as it deems necessary to maintain a Participant's
rights. The Committee may, among other things, (i) accelerate the exercise or
realization of any benefit, (ii) purchase a benefit upon the Participant's
request for cash equalvarious provisions relating to the amount which couldrelative rights of class A common stock and class B common stock would be deemed eliminated. The conversion will have been attained upon the exercise or realizationfollowing effects, among others, on the holders of our class A common stock and our class B common stock: Voting Power — Election of Directors. The holders of our class B common stock currently have the right to elect at least 80% of the benefit had it beenmembers of our board of directors, and the holders of our class A common stock currently exercisable or
payable, (iii) adjusthave the benefit as the Committee deems appropriate, and (iv)
cause the benefitright to be assumed by the surviving corporation. A "change of
control" generally means (i) the acquisition, without the approval of the Board,
by any person or entity, other than us and certain related entities, ofelect no more than 20% of the members of our board of directors. As described above, a provision in our existing articles of incorporation restricts the voting power with respect to directors of a holder of more than 15% of our outstanding class B common stock to 15% of our outstanding class B common stock;providedthat, if such holder also has in excess of 15% of our outstanding class A common stock, such holder of our class B common stock may exercise the voting power of the class B common stock in excess of 15% to the extent that such holder has an equivalent percentage of outstanding class A common stock. After the conversion, all holders of our single class of new common stock will have identical voting rights for the election of all directors. As a result, holders of our class B common stock will no longer have superior rights with respect to the election of members of our board of directors.
10
Voting Power — All Other Matters. Missouri law requires a separate class voting right if an amendment to our articles of incorporation would alter the aggregate number of authorized shares or par value of either such class or alter the powers, preferences or special rights of either such class so as to affect these rights adversely. Upon the conversion, the class B common stock will cease to exist and such class vote will no longer be applicable. As to all other matters on which shareholders are entitled to vote, the conversion will have no impact on the voting power of holders of class A common stock and class B common stock. On such matters, the holders of class A common stock and class B common stock are currently entitled to cast approximately 53% and 47%, respectively, of the total number of votes entitled to be cast. After the conversion of our class B common stock, the current holders of class A common stock and the current holders of class B common stock would be entitled to cast the same proportions of the total number of votes entitled to be cast. Economic Equity Interests. The proposed conversion will have no impact on the economic equity interests of holders of our class A common stock and our class B common stock, including with regard to dividends, liquidation rights or redemption. As of September 30, 2008, the shares held by the holders of our class A common stock and our class B common stock represent 53% and 47%, respectively, of the total outstanding shares of common stock through a tender offer,
exchange offer or otherwise; (ii)stock. After the liquidation or dissolution of us following
a sale or other disposition of all or substantially allconversion of our assets; (iii) a
merger or consolidation involving us which results inclass B common stock, the shares of new common stock held by current holders of our class A common stock and our class B common stock would represent the same proportions of the total outstanding shares of new common stock. Capitalization. The conversion will have no impact on the total issued and outstanding shares of common stock. As of September 30, 2008, there were 62,324,164 shares of common stock issued and outstanding, consisting of 33,080,625 shares of our class A common stock and 29,243,539 shares of our class B common stock. After the conversion, there would be 62,324,164 shares of the new common stock outstanding as of such date. In addition, the conversion will not beingincrease our total number of authorized shares of common stock. Accordingly, after the surviving parent corporation; or (iv) a changeconversion, our authorized capital stock will consist of 140,000,000 shares of common stock (instead of 107,700,000 shares of class A common stock and 32,300,000 shares of class B common stock) and 10 million shares of preferred stock. Market Price. After the conversion, the market price of shares of our new common stock will depend, as before the conversion, on many factors including our future performance, general market conditions and conditions in the majorityindustries in which we operate, many of the members of
the Board of Directors during any two-year period not approved by at least
two-thirds of the Directors who were members at the beginning of the two-year
period.
The Plan will remain in effect until terminated by the Board of Directors.
The Board, in its sole discretion, may terminate the Plan at any time and from
time to time may amend or modify the Plan. However, the Board may not amend the
Plan, without obtaining shareholder approval in a manner (i) which would cause
options which are intended to qualify as incentiveoutside of our control. Accordingly, we cannot predict the price at which our new common stock options to fail to
qualify, (ii) which would causewill trade following the Plan to fail to meet the requirements of
Rule 16b-3 of the Securities Exchange Act of 1934 or Internal Revenue Code
Section 162(m), or (iii) which would violate applicable law. No amendment,
modification or termination of the Plan will adversely affect a Participant's
right to any benefit granted under the Plan prior to such amendment or
termination.
35
BENEFITS GRANTED UNDER THE PLAN
Non-qualified stock options, grants of PCRS units and restricted stock are
the only forms of benefits that have been granted under the Plan. The following
table summarizes the options, restricted shares and PCRS units granted for each
of the enumerated categories of individuals from the first grant under the Plan
on May 4, 1993, through the most recent grants and awards on February 20, 2007.
EQUITY AWARDS GRANTED AND OUTSTANDING UNDER THE FLEXIBLE STOCK PLAN
-------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------
WEIGHTED-
TOTAL OPTIONS AVG. PCRS
---------------------- EXERCISE -----------------------
PRICE OF POTENTIAL
OUTSTANDING AWARD RESTRICTED
NAME AND POSITION GRANTED OUTSTANDING OPTIONS GRANTED(1) (AT TARGET) STOCK
- --------------------------------------------------------------------------------------------------------------------
A. Greig Woodring
President and CEO 790,945 459,011 $ 34.41 67,145 38,165 15,000
- --------------------------------------------------------------------------------------------------------------------
Jack B. Lay
Sr. EVP and CFO 192,446 110,630 $ 37.12 22,962 12,702 6,548
- --------------------------------------------------------------------------------------------------------------------
David B. Atkinson
EVP and COO 435,345 155,956 $ 35.64 25,311 13,011 6,548
- --------------------------------------------------------------------------------------------------------------------
Paul A. Schuster,
Sr. EVP-U.S. Operations 242,677 126,357 $ 35.37 22,962 12,702 --
- --------------------------------------------------------------------------------------------------------------------
Graham S. Watson
Sr. EVP - International 186,415 122,330 $ 36.83 35,000 21,000 --
- --------------------------------------------------------------------------------------------------------------------
Executive Officer Group 1,969,756 1,049,064 $ 35.48 190,595 106,875 28,096
- --------------------------------------------------------------------------------------------------------------------
Non-Executive Officer
Employee Group 3,813,674 1,899,691 $ 38.30 433,813 265,089 650
- --------------------------------------------------------------------------------------------------------------------
Non-Executive Director Group -- -- -- -- -- --
- --------------------------------------------------------------------------------------------------------------------
Total 5,783,430 2,948,755 $ 37.30 624,408 371,964 28,746
- --------------------------------------------------------------------------------------------------------------------
1. Column reflects 2004-2006 award of shares at maximum (200%), as determined
and awarded by the Compensation Committee in February 2007. The 2005-2007
and 2006-2008 grants of PCRS units are reflected at target.
FEDERAL INCOME TAX CONSEQUENCES
Stock Options. No income will be realized by a Participant on the grant of
a stock option, and we will not be entitled to a deduction at such time. If a
Participant exercises an incentive stock option and does not dispose of the
shares acquired within two years fromconversion. On October 6, 2008, the date of the grant, or within one year
fromannouncement of this proposal and the date before filing of the preliminary proxy statement relating to this proposal, the closing prices per share of our class A common stock and our class B common stock on the NYSE were $51.20 and $49.75, respectively. On October [ ], 2008, the date prior to the date of exercisethis proxy statement, the closing prices per share of the option, no income will be realized by the
Participant at the time of exercise. We will not be entitled to a deduction by
reason of the exercise.
If a Participant disposes of the shares acquired pursuant to an incentiveour class A common stock option within two years from the date of grant of the option or within one
year from the date of exercise of the option, the Participant will realize
ordinary income at the time of disposition which will equal the excess, if any,
of the lesser of (a) the amount realized on the disposition, or (b) the Fair
Market Value of the shares on the date of exercise, over the Participant's basis
in the shares. We generally will be entitled to a deduction in an amount equal
to such income in the year of the disqualifying disposition. If a Participant
disposes of the shares acquired pursuant
36
to an incentive stock option following the later of the date (a) two years from
the date of grant of the option or (b) one year from the date of exercise of the
option, the difference, if any, between the amount realized from the sale and the exercise price will be taxed as a capital gain or capital loss.
Upon the exercise of a non-qualified option, the excess, if any, of the
Fair Market Value of theour class B common stock on the NYSE were $[ ] and $[ ], respectively. NYSE Listing and CUSIP Numbers. After the effective date of exercise over the purchase priceconversion, if authorization is ordinary incomereceived from the NYSE, all of the outstanding shares of our new common stock will be listed on the NYSE and our new common stock will be assigned the ticker symbol “RGA”. We plan to request a symbol change for our class A common stock from “RGA.A” to “RGA” and plan to request our class B common stock to be delisted from the NYSE after the effective date. Furthermore, we expect our new common stock will retain and use the CUSIP security identification number presently assigned to our class A common stock. Operations. The proposed conversion will have no impact on our operations, except to the holderextent that we are able to realize some or all of the potential benefits to the Company from the proposed conversion which are described above. Resale of New Common Stock. Shares of our new common stock may be sold in the same manner as our class A common stock and our class B common stock may currently be sold. Our affiliates and holders of any shares that constitute restricted securities will continue to be subject to the restrictions specified in Rule 144 under the Securities Act of 1933, as amended. Rights Agreement. We plan to amend and restate our Section 382 Shareholder Rights Agreement to reflect the conversion,effective as of the date of exercise. We generally will
be entitled to a deduction equal to such excess amount in the year of exercise.
SARs. No income will be realized by a Participant upon the grant of an
SAR, and we will not be entitled to a deduction at such time. Upon the exercise
of a SAR, the excess, if any,completion of the Fair Market Value conversion,to provide that each outstanding share
11
of thenew common stock will have an associated right to purchase a fraction of one share of our Series A Preferred Stock on the date
of exercise over the Fair Market Value of the stock on the date of grant is
ordinary income to the holder as of the date of exercise. We generally will be
entitled to a deduction equal to such excess amount in the year of exercise.
Restricted Stock. Unless a timely 83(b) election is made, as described in
the following paragraph, a Participant generally will not recognize taxable
income upon the grant of restricted stock because the restricted stock generally
will be nontransferableterms and subject to a substantial riskthe conditions set forth in such amended and restated Section 382 Shareholder Rights Agreement. Stock Incentive Plans. Upon the conversion, outstanding options to purchase class A common stock and other awards with respect to class A common stock issued under any of forfeiture. A
Participantour equity incentive plans will recognize ordinary income whenbe redesignated as options and awards for the restrictions that impose a
substantial risksame number of forfeiture of the shares of new common stock upon the same terms and conditions as before the conversion. PIERS Units. Upon the conversion, references to our class A common stock in our outstanding Trust Preferred Income Equity Redeemable Securities Units (and their constituent warrants) will be redesignated as references to our new common stock. Interests of our Officers and Directors in the Reclassification. In considering the recommendation of our board of directors, you should be aware that some of our officers and directors may have interests in the conversion that are or may be different from, or in addition to, the interests of some or all of our public shareholders. For instance, our officers and directors hold class A common stock as described under “Security Ownership of Certain Beneficial Owners and Management” above. As of September 30, 2008, the directors hold an aggregate of 134,825 shares of class A stock and stock options to purchase 486,942 shares of class A common stock. The executive officers hold an aggregate of 272,917 shares of class A stock and stock options to purchase 1,019,357 shares of class A common stock (including 100,629 shares and stock options to purchase 344,195 shares held by an executive officer who is a director). None of our non-employee directors or executive officers holds class B common stock or stock options or rights relating to our class B common stock. Bylaws. Upon the transfer
restrictions (collectively, the "Restrictions") lapse. The amount recognized
will be equal to the difference between the fair market value of the shares at
the time the Restrictions lapse and the original purchase price paid for the
shares, if any. The ordinary income recognized by a Participant with respect to
restricted stock will be subject to applicable tax withholding by us. If a
timely 83(b) election has not been made, any dividends received with respect to
common stock subject to the Restrictions will be treated as additional
compensation income and not as dividend income.
A Participant may elect, pursuant to Section 83(b) of the Internal Revenue
Code ("Code"), to recognize as ordinary income the fair market value of the
restricted stock upon grant, notwithstanding that the restricted stock would
otherwise not be includable in gross income at that time. If the election is
made within 30 days of the date of grant, then the Participant would include in
gross income an amount equal to the difference between the fair market value of
the restricted stock on the date of grant and the purchase price paid for the
restricted stock, if any. Any change in the value of the shares after the date
of grant will be taxed as a capital gain or capital loss only if and when the
shares are disposed of by the Participant. If the Section 83(b) election is
made, the Participant's holding period for capital gains begins on the date of
grant.
The Section 83(b) election is irrevocable. If a Section 83(b) election is
made and the Participant then forfeits the restricted stock, the Participant may
not deduct as a loss the amount previously included in gross income. A
Participant's tax basis in shares of restricted stock received will be equal to
the sum of the amount (if any) the Participant paid for the common stock and the
amount of ordinary income recognized by the Participant as a result of making
Section 83(b) election or upon the lapse of the Restrictions. Unless a Section
83(b) election is made, the Participant's holding period for the shares for
purposes of determining gain or loss on a subsequent sale will begin on the date
the Restrictions on the shares lapse. In general,conversion, we will be entitledamend and restate our bylaws to a
deduction at the same time, and in an amount equalremove references to the ordinary income
recognized by a Participant with respect to shares of restricted stock. If,
subsequent to the lapse of the Restrictions on the shares, the Participant sells
the shares, the difference, if any, between the amount realized from the sale
and the tax basis in the shares of the Participant will be taxed as a capital
gain or capital loss.
Performance Shares. A Participant generally will not recognize taxable
income upon the grant of performance shares. Instead, a Participant will
recognize as ordinary income, and we will have as a corresponding deduction, any
cash delivered and the fair market value of any common stock delivered in
payment of an amount due under the performance share award. The ordinary income
the Participant recognizes will be subject to applicable tax withholding by us.
Upon selling any shares of common stock received by a Participant in payment of
an amount due under a performance share award, the Participant generally will
recognize a capital gain or loss in an amount equal to the difference between
the sale price of the shares of common stock and the Participant's tax basis in
the shares ofour class B common stock.
37
Cash Awards. Awards payable in cash are includible in the Participant's
gross income when paid and deductible by us when paid or accrued.
Other Stock Based awards. The tax consequences associated with any other
stock based award will vary depending on the specific terms of the award,
including whether the award has a readily ascertainable fair market value,
whether or not the award is subject to forfeiture provisions or restrictions on
transfer, the nature of the property to be received by the Participant under the
award, the applicable holding period and the Participant's tax basis.
The foregoing statement is only a summary of Certain Federal Income Tax Consequences We have summarized below certain federal income tax consequences of the Flexible Stock Planconversion based on the Internal Revenue Code (which we refer to as the “Code”). This summary applies only to our shareholders that hold their class A common stock and class B common stock as a capital asset within the meaning of section 1221 of the Code. Further, this summary does not discuss all aspects of federal income taxation that may be relevant to you in light of your individual circumstances. In addition, this summary does not address any state, local or foreign tax consequences of the proposed conversion. This summary is included for general information purposes only and is based on our understanding of
presentnot intended to constitute advice regarding the federal income tax laws and regulations.
VOTE REQUIRED
The vote required to approve this Item 2 is a majorityconsequences of the common stock
represented in person or by proxy atproposed conversion. Since the Annual Meeting, provided the total vote
cast represents over 50% of the shares entitledtax consequences to vote. As a holder of common
stock, MetLife is entitledyou will depend on your particular facts and circumstances, you are urged to vote on this proposal. MetLife beneficially owns
and has shared voting powerconsult your own tax advisor with respect to approximately 52.5%the tax consequences of the conversion, including tax reporting requirements. We believe that as a result of the conversion: | | | | • | no gain or loss will be recognized for federal income tax purposes by any of the holders of our class A common stock or any of the holders of our class B common stock upon the conversion of class B common stock into class A common stock and the designation of the class A common stock as new common stock; | | | • | a shareholder’s aggregate basis in its shares of new common stock will be the same as the shareholder’s aggregate basis in the class A common stock and class B common stock converted pursuant to the conversion; | | | • | a shareholder’s holding period for the new common stock will include such shareholder’s holding period for the class A common stock and class B common stock converted pursuant to the conversion, provided that each share of class A common stock and class B common stock was held by such shareholder as a capital asset as defined in Section 1221 of the Code on the effective date of the conversion; and |
12
| | | | • | no gain or loss will be recognized for federal income tax purposes by us upon the conversion of our class B common stock into class A common stock and the designation of the class A common stock as new common stock. |
Accounting Considerations We expect that the conversion will not have any material effect on our earnings or book value per share. Independent Registered Accounting Firm We do not expect any representative of Deloitte & Touche LLP to be present at the special meeting. Accordingly, we do not except them to make any statements or to be available to respond to appropriate questions. Stock Certificates If the proposed conversion is approved, your existing certificates representing shares of class A common stock and class B common stock (or ownership statements in lieu thereof) will automatically represent an equal number of shares of new common stock.Accordingly, it will not be necessary for record holders of class A common stock or class B common stock holding certificated shares to exchange their existing certificates for new certificates.However, if they so desire, such holders may at any time after the effective date exchange their existing certificates for certificates representing shares of our outstanding shares. MetLifenew common stock by contacting our transfer agent. Required Vote All holders of record of shares of class A common stock and class B common stock on the record date are entitled to cast one vote per share with regard to the conversion. Approval of the conversion requires the affirmative vote of the holders of both: | | | | • | a majority of the class A common stock represented in person or by proxy and entitled to vote at the special meeting; and | | | • | a majority of the class B common stock represented in person or by proxy and entitled to vote at the special meeting. |
No Appraisal Rights Holders of our class A common stock and class B common stock do not have appraisal rights under Missouri law or under our articles of incorporation or bylaws in connection with the conversion. Recommendation of the Board Our board of directors unanimously recommends a vote “for” the approval of the conversion.
13
PROPOSAL TWO: ADOPTION OF AMENDMENT AND RESTATEMENT OF AMENDED AND RESTATED ARTICLES OF INCORPORATION Our board of directors has informed us that it intendsauthorized and recommends for approval an amendment and restatement of our existing articles of incorporation (which we refer to voteas the “charter amendment”) to eliminate provisions relating to our class B common stock and our dual class common stock structure. We are seeking the approval of our shareholders for this Item 2; therefore,proposed amendment. The charter proposal is subject to and conditioned upon approval of the conversion proposal. However, approval of the conversion proposal is not conditioned upon approval of the charter proposal. If both the conversion proposal and the charter proposal are approved by the requisite vote of shareholders, we will file amended and restated articles of incorporation with the Secretary of State of the State of Missouri that would eliminate references to class B common stock and redesignate class A common stock as “common stock.” Such amended and restated articles of incorporation would become effective on the date of filing. We would expect to file the amended and restated articles of incorporation with the Missouri Secretary of State as soon as practicable after obtaining shareholder approval, subject to the right of our board of directors to abandon the filing of the amended and restated articles of incorporation, as described in more detail below. Because this Item 2is a summary of the proposed charter amendment, it may not contain all of the information that is important to you. You should read carefully the proposed amendment and restatement of our articles of incorporation attached as Appendix A to this proxy statement before you decide how to vote. In order to facilitate review by our shareholders, Appendix A is marked to reflect all changes to be made as a result of the charter proposal to our existing articles of incorporation. Reasons for the Charter Amendment Our board of directors believes that upon a conversion, our articles of incorporation as currently in effect may confuse shareholders and other third parties because of references to our class A common stock, class B common stock, the reclassification effected on September 12, 2008, and the conversion. Amending and restating our articles of incorporation would eliminate such references and may serve to avoid any confusion. The provisions proposed to be eliminated include: | | | | • | references to authorization of class A common stock, class B common stock and the September 2008 reclassification (Article Three, Section A); | | | • | restrictions on rights of preferred stock to protect class A common stock and class B common stock (Article Three, Section B); | | | • | rights of class A common stock and class B common stock (Articles Three, Section C); | | | • | interpretation of articles of incorporation after the conversion (Article Three, Section D); | | | • | deemed restatement of articles of incorporation (Article Three, Section E); and | | | • | requirements for separate class vote to amend Article Three (Article Three, Section F). |
Among other things, the charter amendment would also: | | | | • | reflect that certificates representing old class A common stock or class B common stock will represent shares of the new single class of common stock, until surrendered (Article Three, Section A); | | | • | reflect that each share of new common stock will have one vote per share (Article Three, Section B); and | | | • | clarify the meaning of “New Common Stock” as used in Article Fourteen (Article Three, Section A). |
We do not intend this proposal to make any substantive change to our articles of incorporation (except to reflect the conversion and the elimination of class B common stock). Adoption of the charter proposal will have no effect upon the future operations or capital structure of the Company.
14
Conditions Precedent to Effectiveness of the Charter Amendment The effectiveness of the charter amendment is conditioned upon each of the following: | | | | • | approval of the conversion proposal, as described in Proposal One; | | | • | approval of the charter proposal by a majority of the outstanding shares of class A common stock; | | | • | approval of the charter proposal by a majority of the outstanding shares of class B common stock; | | | • | approval of the charter proposal by a majority of all outstanding shares of common stock; and | | | • | the filing of amended and restated articles of incorporation with the Secretary of State of the State of Missouri. |
If any of the above conditions are not satisfied, the charter amendment will not occur. Reservation of Rights by our Board of Directors Our board of directors reserves the right to abandon the adoption of the charter amendment without further action by our shareholders at any time before the filing of the amended and restated articles of incorporation with the Missouri Secretary of State, even if the charter proposal has been approved by the shareholders at the special meeting and all other conditions to such adoption have been satisfied. Although the board of directors does not anticipate exercising its rights to abandon the charter proposal nor does it contemplate specific events that would trigger abandonment, the board of directors will defer or abandon the charter amendment if, in its business judgment, the charter proposal is assured.
RECOMMENDATION OF THE BOARD
In accordance with its charter,no longer in the Compensation Committeebest interests of the BoardCompany or its shareholders. By voting in favor of Directors recommendedthe charter proposal, you will also be expressly authorizing the board to determine not to proceed with, and abandon, the charter proposal if it should decide to do so. Required Vote All holders of record of shares of class A common stock and class B common stock on the record date are entitled to cast one vote per share with regard to the Boardconversion. Approval of Directors that it approve the proposal
regardingconversion requires the amendment toaffirmative vote of the holders of: | | | | • | a majority of the outstanding shares of class A common stock; | | | • | a majority of the outstanding shares of class B common stock; and | | | • | a majority of all outstanding shares of common stock. |
No Appraisal Rights Holders of our Flexible Stock Plan. On February 20, 2007,class A common stock and class B common stock do not have appraisal rights under Missouri law or under our articles of incorporation or bylaws in connection with the charter proposal. Recommendation of the Board Our board of Directors approveddirectors unanimously recommends a vote “for” the proposal regarding future salesapproval of Equity
Securities from time to time to MetLife andthe charter proposal.
15
PROPOSAL THREE: ADJOURNMENT PROPOSAL Our board of directors unanimously recommends that shareholders vote FOR“FOR” the proposal.
- --------------------------------------------------------------------------------
ITEM 3 - SALE OF SECURITIES TO METLIFE OR ITS AFFILIATES
- --------------------------------------------------------------------------------
The third item to be acted upon atapproval of the Annual Meeting is a proposal to authorize future salesadjourn the special meeting if necessary or appropriate to permit further solicitation of our equity securities, including common stock,
preferred stock, depository shares, warrants, purchase contracts, units,
convertible debt, or other securities convertible into or exercisable for common
stock or preferred stock ("Equity Securities"), from time to time to MetLife or
its affiliates (collectively "MetLife") upon the terms and conditions described
below.
BACKGROUND
MetLife is our principal beneficial shareholder. See "Item 1 - Election of
Directors - Securities Ownership of Directors, Management and Certain Beneficial
Owners." We desire to have the flexibility to allow MetLife to participate in
equity capital fund-raising activities which we may undertake from time to time
in the future. By participating in such activities, MetLife would be able to
maintain all or a part of its relative ownership percentage in us,proxies if it so
desired. NYSE rules generally require approval by our shareholders of any
issuance of Equity Securities to MetLife, due to the current level of beneficial
ownership of MetLife (approximately 52.5% of the total common stock).
We may decide to raise equity capital at various times in the future in
order to enhance our capital structure, to fund growth opportunities or for
other corporate purposes. As part of any capital raising plan, we may undertake
either to privately place Equity Securities to MetLife and other investors, or
sell Equity Securities to MetLife and other investors pursuant to a public
offering. The terms of any potential sale to MetLife havethere are not been determined,
but in any event would be expected to approximate the current market value of
such securities at the time of sale, as described below. The Board of Directors
will determine the terms of any such sale and the securities offered thereinsufficient votes at the time of the transaction. Any private sales would not be registered under the
Securities Act of 1933 and such shares could not be offered or sold in the
38
United States absent registration or an applicable exemption from registration
requirements. Any public offering would only be made by means of a prospectus.
Although we do not currently have any definite capital-raising plans or
commitments, we have filed a registration statement covering the issuance of up
to $1.0 billion of Equity Securities, which has become effective, of which
$300,000 was issued in a recent debt offering. In November 2003, we completed
the offering of approximately $427,575,000 (net of underwriters discount), or
12,075,000 shares of common stock pursuant to this registration statement, of
which MetLife and its affiliates purchased $109,950,000, or 3,000,000 shares of
common stock. This proxy statement shall not constitute an offer to sell or the
solicitation of any offer to buy nor shall there be any sale of these securities
in any state in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities law of any such state.
As of February 1, 2007, our authorized capital stock consists of
140,000,000 shares of common stock and 10,000,000 shares of preferred stock. The
Board of Directors has the authority to issue authorized shares of the preferred
stock in series and to fix the number, designation, preferences, limitations and
relative rights of the shares of each series, subject to applicable law and the
provisions of any outstanding series of preferred stock. Depositary shares would
represent an interest in shares of a series of preferred stock deposited under a
deposit agreement by us with a bank or trust company. Subject to the terms of
the deposit agreement, each owner of a depositary share would be entitled,
proportionately, to all the rights, preferences and privileges of the preferred
stock represented by such depositary share. Similarly, the terms of any purchase
contracts, units, convertible debt securities or warrants or other securities,
whether convertible into or exercisable for debt securities, common stock or
preferred stock, would be determined by the Board of Directors.
REASONS FOR THE PROPOSAL
Our Board of Directors believes it is in our best interest to maintain the
flexibility to facilitate possible further investments in us by MetLife or its
affiliates for the reasons described below. Although the Board of Directors has
not committed to issue any Equity Securities to MetLife, it believes it is
desirable to have the flexibility to do so from time to time without having to
first seek shareholder approval for each particular transaction if and when the
Board of Directors determines the issuance would be in the best interests of
shareholders.
Since the Board of Directors has not determined at this time to issue any
Equity Securities to MetLife, it has not fully assessed all aspects of any such
transaction. Any decision to issue shares to MetLife or otherwise will be based
on the facts and circumstances at that time. In general, the Board of Directors
believes it may be desirable to issue Equity Securities to MetLife in order to
maintain a strong relationship for the following reasons:
Continuity. In the event the Board of Directors decides we should issue
Equity Securities to MetLife, MetLife may avoid dilution to its voting control.
Such an issuance may therefore reduce the risk of a disruption in the continuity
of our long-term plans and objectives that might otherwise result if MetLife
were no longer to maintain control.
Key Employees. Maintenance of control by MetLife may allow key employees
to continue to concentrate on their responsibilities without undue concern that
our future might be affected by an unwanted takeover that could otherwise be
triggered. As a result, we may be better able to preserve its ability to attract
and retain qualified key employees.
Business Relationships. The issuance of Equity Securities to MetLife may
enhance our existing and potential business relationships with parties who may
in the future have concern about changes in control of RGA in the event the
holdings of MetLife are ever diluted. We may be better able to attract joint
venture and marketing partners if we are perceived not to be vulnerable to a
takeover or disruption due to uncertainty concerning our ownership.
Financing Flexibility. The Board of Directors believes that MetLife, as
our principal shareholder, may be willing to invest under circumstances when
public investors might not. Although we believe we
39
currently have reasonable access to public and private capital markets, the
Board of Directors believes it is in the best interests of shareholders that we
have ready access to all sources of capital, including MetLife.
NEW YORK STOCK EXCHANGE RULES
Under the applicable rules of the NYSE, the shareholders of we generally
must approve any significant issuance of common equity, or securities
convertible into or exercisable for common equity, by us to a substantial
shareholder, such as MetLife. In order to comply with such rules, the NYSE
requires that our shareholders approve the various terms of the proposed sales,
such as the identity of the substantial shareholder, the price for the shares,
the amount of shares to be sold, the length of time during which sales would be
made, the use of proceeds from the sales and the reasons for the sales.
TERMS OF SALES
Because the exact terms of any sale of Equity Securities to MetLife are
not known at this time, we propose that the shareholders vote in favor of this
Item 3special meeting to approve the sale of shares subject to certain specific terms and
conditions. Under theconversion proposal the Board of Directors would be authorized to
approve, during the next three years, any sale of our Equity Securities to
MetLife in which the number of such shares, including shares into which such
Equity Securities are convertible or exercisable, would not exceed the number of
shares that would enable MetLife to maintain its then current ownership
percentage of our securities having voting power, currently our common stock.
Any such sale would be on substantially the same terms as a sale to unaffiliated
parties.
While the terms of a sale to MetLife would be substantially the same as a
sale to unaffiliated parties, it may be appropriate in certain situations to
reduce the sales price, based on expected expenses of the sale and the availability of other sources of capital. For example, in connection with a
private placement of Equity Securities, we may pay a reduced sales commission.
Based on current costs associated with capital raising transactions, we do not
expect any reduction in sales pricecharter proposal. We refer to exceed 3%. this as the “adjournment proposal.” The number and kind of Equity
Securities issuable to MetLife underadjournment proposal requires the proposal will be appropriately adjusted
by us in the event of any increase or decrease in the number of shares
outstanding as a result of a reorganization, merger, recapitalization,
reclassification, stock dividend, stock split, combination of shares or other
similar transaction.
The amount of Equity Securities and the sale price, conversion price or
exercise price per share, as applicable, for such shares sold to MetLife
pursuant to any sale authorized by this Item 3 will be determined by the Board
of Directors or a committee of the Board of Directors specifically authorized to
make such determination, within the parameters of the proposal contained in this
Item 3. Such a committee will include directors who are not affiliated with
MetLife.
Shareholders should note that the pricing of preferred stock, depository
shares, purchase contracts, units, warrants, convertible debt or other
securities convertible or exercisable for common stock is typically dependent on
the other terms and provisions of the securities, including, without limitation,
dividend rate, redemption price, liquidation rights, sinking fund provisions,
conversion rights and voting rights, and other terms and restrictions, and any
corresponding effect on other shareholders, in the case of preferred stock or
any related depositary share; interest rates, redemption price, conversion
rights, sinking fund procedures, term and covenants or other restrictions, in
the case of debt securities; and exercise price, term and covenants or other
restrictions, in the case of other securities, such as purchase contracts, units
or warrants. Such terms and effects could include restrictions on dividends on
the common stock if dividends on the preferred stock or any related depositary
share, or interest payments on any debt securities, are in arrears, dilution of
the voting power of other shareholders to the extent a series of the preferred
stock or any related depository share has voting rights, and reduction of
amounts available on liquidation as a result of any obligations created by any
debt securities or liquidation preference granted to any series of preferred
stock or any related depositary share. Accordingly, shareholders will have to
rely on our Board of Directors, if such a transaction is ultimately approved, to
ensure that the overall terms and conditions of the securities are in our best
interest.
40
In the event any proposed sale of Equity Securities to MetLife materially
differs from the terms described above, we would expect to seek shareholder
approval of such proposed sale to the extent required under applicable NYSE
rules.
Because we have not made a decision at this time to sell any Equity
Securities to MetLife, it cannot identify the uses of any proceeds from any sale
of such shares. We, however, may use any such proceeds, among other things, to
fund our continuing growth, to enhance our capital structure, to finance
acquisitions, for general working capital purposes or for other corporate
purposes.
Any issuance of preferred stock, depositary shares, purchase contracts,
units, warrants, convertible debt or other convertible securities may have the
result of making it more difficult for any persons or group of persons, other
than the current principal shareholders and management, to acquire control of us
by expanding our ability to issue shares and thereby dilute the voting power of
any person or group that might accumulate shares in order to attempt to effect a
change in control. We are not aware of any present effort to accumulate shares
of common stock or to attempt to change control of RGA.
Our articles of incorporation and bylaws provide, among other things, for
a classified board of directors; limit the right of shareholders to remove
directors or change the size of the board of directors; limit the right of
shareholders to fill vacancies on the board of directors; limit the right of
shareholders to act by written consent and to call a special meeting of
shareholders or propose other actions; require a higher percentage of
shareholders than would otherwise be required to amend, alter, change or repeal
the provisions of the articles of incorporation or bylaws; and provide that the
bylaws may be amended only by the majority of the board of directors. These
provisions may have an anti-takeover effect.
INTERESTS OF CERTAIN PERSONS IN THE PROPOSAL
Some of our officers and directors are also officers and directors of
MetLife. See "Item 1 - Election of Directors - Securities Ownership of
Directors, Management and Certain Beneficial Owners." As a result, such officers
and directors, as well as MetLife, may be deemed to have an interest in the
proposal that differs from those of other shareholders. For more information
regarding the relationships between us and MetLife, see "Certain Relationships
and Related Person Transactions."
CERTAIN POTENTIAL DISADVANTAGES OF THE PROPOSAL
While the Board of Directors has determined that adoption of the proposal
is in the best interests of us and our shareholders, the Board recognizes that
the implementation of the proposal may result in certain disadvantages. For
example, since MetLife currently has voting control over us, implementation of
the proposal would allow the Board of Directors to permit MetLife to maintain
its voting control of RGA. Consequently, the proposal might prevent our
shareholders from selling their shares at a premium over prevailing market
prices in response to a takeover proposal and make it more difficult to replace
our current Board of Directors and management. We are not aware of any such
takeover proposal at this time.
Under NYSE rules, we are required to submit certain proposals to sell
stock to substantial shareholders to a vote at a meeting of all shareholders.
Under the proposal, future decisions to sell stock to MetLife would be made by
the Board of Directors without a further vote of shareholders, including, among
other things, with respect to the pricing and terms of any such sale.
Accordingly, shareholders will not have an opportunity to consider or vote upon
any such sales, to the extent the terms are consistent with those described
herein.
PROPOSAL TO APPROVE SALES TO METLIFE
Our Board of Directors has approved, and recommends that our shareholders
approve, the authorization of the Board of Directors to approve any future sales
of Equity Securities to MetLife during the next three years, commencing on the
date of the Annual Meeting, in which the number of shares, including shares into
which such Equity Securities are convertible or exercisable, will not exceed
such number of
41
shares (subject to adjustment, as described above) which would enable MetLife to
maintain its then current beneficial ownership percentage of our securities
having voting power, currently our common stock. Any such sale would be made on
substantially the same terms as a sale to unaffiliated parties. The number of
shares and price per share for such a sale will be determined by the Board of
Directors or a committee thereof in accordance with the terms of this proposal.
VOTE REQUIRED
The vote required to approve this Item 3 is a majority of the outstanding
common stock represented in person or by proxy at the Annual Meeting and
entitled to vote. Under the NYSE rules, the matter must also receive the
affirmative vote of a majority of the votes cast on the matter, provided that
the total votes cast represent more than 50% of the shares entitled to vote. As
a holder of common stock, MetLife is entitled to vote on this proposal. MetLife
beneficially owns and has shared voting power with respect to approximately
52.5% of our outstanding shares. MetLife has informed us that it intends to vote
for this Item 3; therefore, approval of this Item 3 by the shareholders is
assured.
RECOMMENDATION OF THE BOARD
The Board of Directors has approved the proposal regarding future sales of
Equity Securities from time to time to MetLife and recommends that shareholders
vote FOR the proposal.
EQUITY COMPENSATION PLAN INFORMATION
The following table presents Equity Compensation Plan information as of
December 31, 2006:
- --------------------------------------------------------------------------------------------------------------------
NUMBER OF SECURITIES TO WEIGHTED-AVERAGE NUMBER OF SECURITIES
BE ISSUED UPON EXERCISE EXERCISE PRICE OF REMAINING AVAILABLE FOR
OF OUTSTANDING OPTIONS, OUTSTANDING OPTIONS, ISSUANCE UNDER EQUITY
PLAN CATEGORY WARRANTS AND RIGHTS WARRANTS AND RIGHTS COMPENSATION PLANS
- --------------------------------------------------------------------------------------------------------------------
Equity Compensation Plans Approved
by Security Holders 3,221,197(1) $34.39(2,3) 553,835(4)
- --------------------------------------------------------------------------------------------------------------------
Equity Compensation Plans Not
Approved by Security Holders
- --------------------------------------------------------------------------------------------------------------------
TOTAL 3,221,197 $34.39(2,3) 553,835
- --------------------------------------------------------------------------------------------------------------------
- -------------
1. Includes the number of securities to be issued upon exercises under the
following plans: Flexible Stock Plan - 3,153,291; Flexible Stock Plan for
Directors - 38,433; and Phantom Stock Plan for Directors - 29,473.
2. Does not include 392,180 PCRS units to be issued under the Flexible Stock
Plan, or 29,473 phantom units to be issued under the Phantom Stock Plan
for Directors because those securities do not have an exercise price
(i.e., a unit is a hypothetical share of our common stock with a value
equal to the fair market value of our common stock).
3. Reflects the blended weighted-average exercise price of outstanding
options under the Flexible Stock Plan ($34.43) and Flexible Stock Plan for
Directors ($31.55).
4. Includes the number of securities remaining available for future issuance
under the following plans: Flexible Stock Plan - 413,799; Flexible Stock
Plan for Directors - 108,653; and Phantom Stock Plan for Directors -
31,383.
ADDITIONAL INFORMATION
VOTING
The affirmative vote of the holders of a majority of the outstanding shares of ourclass A common stock entitled to vote which areand class B common stock, voting together as a single class, present in person or represented by proxy at the 2007 Annual Meeting is required to approve Items 1, 2 and 3 and to
act on any other matters properly brought before the meeting (other than the
other specified proposals), provided, in the case of Items 2 and 3, the total
votes cast represents over 50% of the shares entitled to vote. Voting results
will be disclosed in our Form 10-Q for the period ending June 30, 2007.
42
Shares represented by proxies which are marked "withhold authority" with respect
to the election of any one or more nominees for election as directors and
proxies which are marked "abstain" or which deny discretionary authority on
other matters will be counted for the purpose of determining the number of
shares represented by proxy at the meeting. Such proxies will thus have the same
effect as if the shares represented thereby were voted against such nominee or
nominees and against such other matters, respectively. If a broker indicates on
the proxy that it does not have discretionary authority as to certain shares to
vote on a particular matter (i.e., a "broker non-vote"), those shares will not
be considered as present and entitled to vote with respecton the proposal.If the special meeting is adjourned to that matter,a different place, date, or time, we need not give notice of the new place, date, or time if the new place, date, or time is announced at the meeting before adjournment, unless they result in a failure to obtain total votes cast ofthe adjournment is for more than 50%90 days. If a new record date is or must be set for the adjourned meeting, notice of the shares entitled to vote. If no specification is made on a duly executed
proxy, the proxyadjourned meeting will be voted FOR Items 1, 2 and 3, and in the discretiongiven to persons who are shareholders of the persons named as proxies on such other business as may properly come before
the meeting.
As of February 1, 2007, MetLife beneficially owned approximately 52.5% of
the shares of RGA common stockrecord entitled to vote at the meeting. MetLife has
indicated its intention to vote its shares FOR eachspecial meeting as of the proposals to be voted
upon at the meeting, and the votenew record date.
16
SHAREHOLDER PROPOSALS Our board of MetLife will be sufficient to approve all
items.
We knowdirectors knows of no other matters which are likely to comebe brought before the meeting. If any other matters should be properly comebrought before the meeting, it is the proxies solicited hereby will be
voted on such mattersintention of the persons named in the enclosed proxy to vote, or otherwise act, in accordance with thetheir judgment of the persons votingon such proxies.
SHAREHOLDER NOMINATIONS AND PROPOSALS
As described in our Corporate Governance Guidelines, the Nominating and
Corporate Governance Committee will considermatters. In order for shareholder nominations for
Directors that meet the notification, timeliness, consent and information
requirements of our Articles of Incorporation. The Committee makes no
distinctions in evaluating nominees for positions on the Board based on whether
or not a nominee is recommended by a shareholder, provided that the procedures
with respectproposals which are submitted pursuant to nominations referred to above are followed. Potential candidates
for nomination as Director candidates must provide written information about
their qualifications and participate in interviews conducted by individual Board
members, including the Chairs of the Audit or Nominating and Governance
Committees. Candidates are evaluated using the criteria adopted by the Board to
determine their qualifications based on the information supplied by the
candidates and information obtained from other sources. The Committee will
recommend candidates for election as Director only if the Committee determines,
in its judgment, that they have the following specific, minimum qualifications
that have been recommended by the Nominating and Governance Committee to, and
approved by, the Board:
o Financial Literacy. Such person should be "financially literate" as
such qualification is interpreted by the Board of Directors in its
business judgment.
o Leadership Experience. Such person should possess significant
leadership experience, such as experience in business,
finance/accounting, law, education or government, and shall possess
qualities reflecting a proven record of accomplishment and ability
to work with others.
o Commitment to Our Values. Such person shall be committed to
promoting our financial success and preserving and enhancing our
business and ethical reputation, as embodied in our Codes of
Conduct.
o Absence of Conflicting Commitments. Such person should not have
commitments that would conflict with the time commitments of a
Director of RGA.
o Reputation and Integrity. Such person shall be of high repute and
recognized integrity and not have been convicted in a criminal
proceeding (excluding traffic violations and other minor offenses).
Such person shall not have been found in a civil proceeding to have
violated any
43
federal or state securities or commodities law, and shall not be
subject to any court or regulatory order or decree limiting his or
her business activity, including in connection with the purchase or
sale of any security or commodity.
o Other Factors. Such person shall have other characteristics
considered appropriate for membership on the Board of Directors,
including an understanding of marketing and finance, sound business
judgment, significant experience and accomplishments and educational
background.
Shareholder proposals submitted under the process prescribed by the SEC
(in Rule 14a-8 of the Exchange Act)Act to be considered by us for presentation atinclusion in the 2008 Annual Meetingproxy material for the annual meeting of shareholders (anticipated to be held on May 27, 2009), they must be received by usthe Secretary of the Company by December 13, 200710, 2008. For proposals that shareholders intend to present at the annual meeting outside the processes ofRule 14a-8 of the Exchange Act, unless the shareholder notifies the Secretary of the Company of such intent by December 10, 2008, any proxy that management solicits for inclusion in oursuch annual meeting will confer on the holder of the proxy statement
and proxy relatingdiscretionary authority to thatvote on the proposal so long as such proposal is properly presented at the meeting. Upon receipt of any such proposal, we will determine whether or not to include such proposal in the proxy statement and proxy in accordance with regulations governing the solicitation of proxies. In order for a Shareholdershareholder to nominate a candidate for director, under our Restated Articlesexisting articles of Incorporation,incorporation, timely notice of the nomination must be given to usthe Company in advance of the meeting. Ordinarily, such notice must be given not less than 60 nor more than 90 days before the meeting (but if we give less than 70 days notice of the meeting, or prior public disclosure of the date of the meeting, then the Shareholdershareholder must give such notice within 10 days after notice of the meeting is mailed or other public disclosure of the meeting is made, whichever occurs first). The shareholder filing the notice of nomination must describe various matters as specified in our Amended and Restated Articlesarticles of Incorporation,incorporation, including such information as name, address, occupation, and number of shares held. In order for a shareholder to bring other business before a Shareholdershareholder meeting, timely notice must be given to us within the time limits described above. Such notice must include a description of the proposed business, the reasons therefore,for such business, and other matters specified in our Amended and Restated
Articlesarticles of Incorporation.incorporation. The Boardboard or the presiding officer at the Annual
Meetingannual meeting may reject any such proposals that are not made in accordance with these procedures or that are not a proper subject for shareholder action in accordance with applicable law. The foregoing time limits also apply in determining whether notice is timely for purposes of rules adopted by the SEC relating to the exercise of discretionary voting authority. These requirements are separate from and in addition to the requirements a shareholder must meet to have a proposal included in our proxy statement. In each case, the notice must be given to ourthe Company’s Secretary, whose address is 1370 Timberlake Manor Parkway, Chesterfield, Missouri63017-6039. Any Shareholdershareholder desiring a copy of our Restatedamended and restated Articles of Incorporation or Bylaws will be furnished a copy without charge upon written request to the Company’s Secretary. WHERE YOU CAN FIND MORE INFORMATION We file annual, quarterly and special reports, proxy statements and other information with the SEC under the Exchange Act. You may read and copy this information at the SEC’s Public Reference Room, located at 100 F Street, N.E., Washington, D.C. 20549. You may obtain information on the operation of the Public Reference Room by calling the SEC at1-800-SEC-0330. You may also obtain copies of this information by mail from the SEC at the above address, at prescribed rates. The SEC also maintains a website that contains reports, proxy statements and other information that we file electronically with the SEC. The address of that website iswww.sec.gov. Shares of our class A common stock and our class B common stock are listed on the NYSE. You may also inspect reports, proxy statements and other information about the Company at the offices of the NYSE, 20 Broad Street, New York, New York 10005. The Company’s filings referred to below are also available on our Internet website,www.rgare.com, under “Investor Relations — SEC filings.” Information contained in our Internet website does not constitute a part of
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this proxy statement. You can also obtain these documents from the Company, without charge (other than exhibits, unless the exhibits are specifically incorporated by reference), by requesting them in writing or by telephone at the following address: Reinsurance Group of America, Incorporated 1370 Timberlake Manor Parkway Chesterfield, Missouri 63017 (636) 736-7000 A list of shareholders will be available for inspection by shareholders of record during business hours at our corporate headquarters at 1370 Timberlake Manor Parkway, Chesterfield, Missouri 63017, for ten days prior to the date of the special meeting and will also be available at the special meeting, and continuing to the date of the special meeting and will be available for review at the special meeting or any adjournments thereof. The SEC allows certain information to be “incorporated by reference” into this document, which means that we can disclose important information to you by referring you to another document filed separately with the SEC. The information incorporated by reference is deemed to be part of this document, except for any information superseded by information contained directly in this document. This document incorporates by reference the documents set forth below that we have previously filed with the SEC. These documents contain important information about our company and our businesses and our financial conditions: The following documents filed by RGA (FileNo. 1-11848) under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of the initial filing of this proxy statement and before the special meeting of shareholders, except for the documents, or portions thereof, that are “furnished” rather than filed, are incorporated by reference into this document: | | | | • | the financial statements, selected quarterly financial data, management’s discussion and analysis of financial condition and results of operations, changes in and disagreements with accountants on accounting and financial disclosure and market risk disclosures contained in our Annual Report onForm 10-K for the fiscal year ended December 31, 2007, filed with the SEC, and our Quarterly Reports onForm 10-Q for the periods ended March 31, 2008 and June 30, 2008; and | | | • | our Current Reports onForm 8-K filed April 17, 2008, June 2, 2008, June 5, 2008, July 21, 2008, August 11, 2008, August 29, 2008, September 5, 2008, September 12, 2008, September 17, 2008, September 25, 2008, and October 7, 2008(other than the portions of those documents not deemed to be filed, except with respect to theForm 8-K filed on September 17, 2008, which shall be incorporated by reference herein). |
All documents filed by us pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act from the date of this document to the date of the special meeting of shareholders will also be deemed to be incorporated into this document by reference, which excludes any information furnished pursuant to Item 2.02 or Item 7.01 of any current report onForm 8-K. Documents incorporated by reference (not including exhibits, unless exhibits are specifically incorporated by reference into the document) are available without charge upon request to our proxy solicitor, MacKenzie Partners at 105 Madison Avenue, New York, NY 10016,(800) 322-2885. In order to ensure timely delivery, any request should be submitted no later than November [18], 2008. If you request any incorporated documents, MacKenzie Partners will mail them to you within one business day after receiving your request. We have not authorized anyone to give any information or make any representation about the special meeting of shareholders that is different from, or in addition to, that contained in this document or in any of the materials that we have incorporated by reference into this document. Therefore, if anyone does give you information of this sort, you should not rely on it. If you are in a jurisdiction where offers to exchange or sell, or solicitations of offers to exchange or purchase, the securities offered by this document are unlawful, or if you are a person to whom it is unlawful to direct these types of activities, then the offer presented in this
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document does not extend to you. The information contained in this document speaks only as of the date of this document unless the information specifically indicates that another date applies. HOUSEHOLDING OF PROXY MATERIALS The SEC has adopted rules that permit companies and intermediaries such as brokers to satisfy delivery requirements for proxy statements with respect to two or more shareholders sharing the same address by delivering a single proxy statementstatement/prospectus addressed to those shareholders. This process, which is commonly referred to as "householding,"“householding,” potentially provides extra convenience for shareholders and cost savings for companies. Some brokers household proxy materials, delivering a single proxy statementstatement/prospectus to multiple shareholders sharing an address unless contrary instructions have been received from the affected shareholders. Once you have received notice from your broker that they will be householding materials to your address, householding will continue until you are notified otherwise or until you revoke your consent. If, at any time, you no longer wish to participate in householding and would prefer to receive a separate proxy statement, or if your household currently receives multiple copies and would like to participate in householding in the future, please notify your broker.
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AMENDMENTACCESS TO THE
PROXY MATERIALS This Proxy Statement may be viewed online at www.rgare.com. You may request a physical copy of this Proxy Statement and form of proxy card, without charge, by writing to us at 1370 Timberlake Manor Parkway, Chesterfield, Missouri63017-6039, Attention Secretary or by calling(636) 736-7243.
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Appendix A AMENDED AND RESTATED ARTICLES OF INCORPORATION
OF
REINSURANCE GROUP OF AMERICA, INCORPORATED
FLEXIBLE STOCK PLAN
AS AMENDED AND RESTATED EFFECTIVE JULY 1, 1998
WHEREAS, ARTICLE ONE
NAME The name of the corporation (hereinafter referred to as the “Corporation”) is: Reinsurance Group of America, Incorporated (the "Company")
established the Reinsurance Group of America, Incorporated Flexible Stock Plan
(the "Plan") to enhance the abilityIncorporated. ARTICLE TWO
REGISTERED OFFICE AND AGENT The address of the CompanyCorporation’s registered office in this state is 120 South Central Ave., St. Louis, Missouri 63105. The name of its registered agent at such address is CT Corporation System. ARTICLE THREE
CAPITAL STOCK A. Class and Number of Shares. The aggregate number, class and par value, if any, of shares which the Corporation shall have authority to rewardissue is 150,000,000 shares, consisting of 140,000,000 shares of common stock, par value $0.01 per share (“Common Stock”), of which 107,700,000 shares shall be designated Class A Common Stock (“Class A Common Stock”) and 32,300,000 shares shall be designated Class B Common Stock (“Class B Common Stock” and collectively with the Class A Common Stock, the “New Common Stock”), and 10,000,000 shares of preferred stock, par value $0.01 per share (“Preferred Stock”) ($1,500,000.00 aggregate total). Immediately uponthe effectiveness of these Amended and Restated Articles of Incorporation (the “Effective Time”), and without any further action on the part of the Corporation or its shareholders, each share ofCommon Stockclass A common stock , par value $0.01 per share, of the Corporation (the “Old Class A Common Stock”) , issued and outstanding immediately prior to the Effective Time(the “Old Common Stock”) shall be, including Old Class A Common Stock into which shares of class B common stock, par value $0.01 per share, of the Corporation (the “Old Class B Common Stock”) were converted pursuant to their terms (the “Conversion”), shall automaticallyreclassified and changed intobe redesignated as one fully paid and nonassessable share ofClass A Common Stock. Each certificate formerly representing a share or shares of OldCommon StockClass A Common Stock (or Old Class B Common Stock, if not theretofore replaced by a certificate representing Old Class A Common stock as a result of the Conversion) shall automatically represent from and after the Effective Time, without any further action on the part of the Corporation or any holder thereof, a number of shares ofClass A Common Stock equal to the number of shares of OldCommon StockClass A Common Stock (or Old Class B Common Stock, if not theretofore replaced by a certificate representing Old Class A Common stock as a result of the Conversion) represented by such certificate immediately prior to the Effective Time; provided, however, that if the Bylaws of the Corporation provide for the issuance of uncertificated shares, and any shares ofClass A Common Stock (or any stock based incentivesinto which suchClass A Common Stock may be converted or exchanged) are issued in uncertificated form in accordance with the Bylaws of the Corporation, then, without any further action on the part of any holder thereof, the Corporation shall cause to its key employees;be sent to such holder a statement of such holdings, which statement shall include any legends that would be set forth on certificates, if such holder’s shares were represented thereby.
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For clarification purposes, references to “New Common Stock” in Article Fourteen shall mean shares of Old Class A Common Stock or Old Class B Common stock prior to the Effective Time and WHEREAS,shares of Common Stock at or after the Company's shareholders previously approvedEffective Time. For clarification purposes, upon the Planeffectiveness of a Conversion (as defined below), the aggregate number, class and amendments thereto;par value, if any, of shares which the Corporation shall have authority to issue will be 150,000,000 shares, consisting of 140,000,000 shares of common stock, par value $0.01 per share (“Common Stock”), and WHEREAS,10,000,000 shares of stock, par value $0.01 per share (“Preferred Stock”) ($1,500,000.00 aggregate total).
B. Voting Rights of the Common Stock. Each holder of the Common Stock shall be entitled to one vote per share of Common Stock on January 25, 2007,all matters to be voted on by the shareholders. BC . Issuance of Preferred Stock, Rights and Preferences Thereof. The Preferred Stock may be issued from time to time in one or more series, with such voting powers, full or limited, or no voting powers, and such designations, preferences and relative, participating, optional or other special rights and qualifications, limitations or restrictions thereof, as shall be stated in the resolution or resolutions providing for the issuance of such stock adopted from time to time by the Board of Directors. Without limiting the generality of the foregoing, in the resolution or resolutions providing for the issuance of such shares of each particular series of Preferred Stock, subject to the requirements of the laws of the State of Missouri, the Board of Directors is also expressly authorized:(i) To fix the distinctive serial designation of the shares of the series; (ii) To fix the consideration for which the shares of the series are to be issued; (iii) To fix the rate or amount per annum, if any, at which the holders of the shares of the series shall be entitled to receive dividends, the dates on which and the conditions under which dividends shall be payable, whether dividends shall be cumulative or noncumulative, and if cumulative, the date or dates from which dividends shall be cumulative; (iv) To fix the price or prices at which, the times during which, and the other terms, if any, upon which the shares of the series may be redeemed; (v) To fix the rights, if any, which the holders of shares of the series have in the event of dissolution or upon distribution of the assets of the Corporation; (vi) From time to time to include additional shares of Preferred Stock which the Corporation is authorized to issue in the series; (vii) To determine whether or not the shares of the series shall be made convertible into or exchangeable for other securities of the Corporation, including shares of the Common Stock of the Corporation or shares of any other series of the Preferred Stock of the Corporation, now or hereafter authorized, or any new class of Preferred Stock of the Corporation hereafter authorized, the price or prices or the rate or rates at which conversion or exchange may be made, and the terms and conditions upon which the conversion or exchange rate shall be exercised; (viii) To determine if a sinking fund shall be provided for the purchase or redemption of shares of the series and, if so, to fix the terms and the amount or amounts of the sinking fund; and (ix) To fix the other preferences and rights, privileges and restrictions applicable to the series as may be permitted law. Notwithstanding the foregoing, the Corporation shall not issue any shares of Preferred Stock with powers, preferences or rights that adversely affect, limit or qualify the powers, preferences and rights of any class of New Common Stock unless such shares of Preferred Stock adversely affect, limit or qualify, in the same manner and on the same per share basis, the powers, preferences and rights of the other class of New Common Stock.
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C. Rights of the New Common Stock. The powers, preferences and rights of the Class A Common Stock and the Class B Common Stock, and the qualifications, limitations or restrictions thereof, shall be identical in all respects, except as otherwise required by law or expressly provided in this Article Three, as follows:
(i) Cash Dividends. Subject to the rights of the holders of any outstanding series of Preferred Stock, and except as otherwise provided for herein, cash dividends may be declared and paid to the holders of New Common Stock in cash as may be declared thereon by the Board of Directors of the Company
approved an amendmentCorporation from time to time out of funds or other assets of the Corporation legally available therefor. If and when cash dividends on the New Common Stock are declared payable from time to time by the Board of Directors, the holders of New Common Stock shall be entitled to share equally, on a per share basis, in all such dividends.
(ii) Dividends or Distributions of New Common Stock. Subject to the Plan, subject to shareholder approval, to
increase the total number of shares authorized for issuance under the Plan by
3,000,000 shares.
NOW, THEREFORE, the Company hereby amends the Plan as follows:
1. Effective upon the date of approval of this amendment by the
Company's shareholders, Section 3.1rights of the Plan is amendedholders of any outstanding series of Preferred Stock, and except as otherwise provided for herein, the holders of New Common Stock shall be entitled to receive such dividends and other distributions in its entirety to
readNew Common Stock of the Corporation as follows:
3.1 Number of Shares. The number of Shares which may be issued or sold or for which Options, SARs or Performance Shares may
be granted under the Plan shall be 9,260,077 Shares. Such Shares may
be authorized but unissued Shares, Shares held in the treasury, or
both.
2. Capitalized terms used herein shall have the same meanings
ascribed to them in the Plan.
IN WITNESS WHEREOF, Reinsurance Group of America, Incorporated hereby
adopts the foregoing amendment this 23rd day of May, 2007.
REINSURANCE GROUP OF AMERICA,
INCORPORATED
/s/ A. Greig Woodring
-------------------------------------
A. Greig Woodring
President and Chief Executive Officer
Appendix A
AMENDMENT TO THE
REINSURANCE GROUP OF AMERICA, INCORPORATED
FLEXIBLE STOCK PLAN
AS AMENDED AND RESTATED EFFECTIVE JULY 1, 1998
WHEREAS, Reinsurance Group of America, Incorporated (the "Company")
established the Reinsurance Group of America, Incorporated Flexible Stock Plan
(the "Plan") to enhance the ability of the Company to reward and provide stock
based incentives to its key employees; and
WHEREAS, the Company's shareholders previously approved the Plan and
amendments thereto; and
WHEREAS, on January 28, 2004,declared thereon by the Board of Directors of the Company
approved an amendmentCorporation from time to the Plan, subject to shareholder approval, to
eliminate the provision for a 5% annual increase in the numbertime out of Shares
allocated to the Plan.
NOW, THEREFORE, the Company hereby amends the Plan as follows:
1. Effective upon the date of approval of this amendment by the
Company's shareholders, Section 3.1assets of the Plan is amendedCorporation legally available therefor. In the case of dividends or other distributions payable in, its entiretyor reclassifications involving, New Common Stock, including distributions pursuant to read as follows:
3.1 Numberstock splits or subdivisions of Shares.New Common Stock, only shares of Class A Common Stock shall be paid or distributed with respect to shares of Class A Common Stock and only shares of Class B Common Stock shall be paid or distributed with respect to shares of Class B Common Stock. The number of Shares whichshares of Class A Common Stock and Class B Common Stock so paid or distributed shall be equal in number on a per share basis.(iii) Property Dividends. Subject to the rights of the holders of any outstanding series of Preferred Stock, and except as otherwise provided for herein, dividends may be issueddeclared and paid to the holders of New Common Stock in stock of any corporation (other than New Common Stock of the Corporation) or sold or for which Options, SARs or Performance Sharesproperty of the Corporation (a “property dividend”) as may be granted under the Plan shall be 6,260,077 Shares. Such Shares may
be authorized but unissued Shares, Shares held in the treasury, or
both.
2. Capitalized terms used herein shall have the same meanings
ascribed to them in the Plan.
IN WITNESS WHEREOF, Reinsurance Group of America, Incorporated hereby
adopts the foregoing amendment this 26th day of May, 2004.
REINSURANCE GROUP OF AMERICA,
INCORPORATED
/s/ A. Greig Woodring
------------------------------------
A. Greig Woodring
President and Chief Executive Officer
SECOND AMENDMENT TO THE
REINSURANCE GROUP OF AMERICA, INCORPORATED
FLEXIBLE STOCK PLAN
AS AMENDED AND RESTATED EFFECTIVE JULY 1, 1998
WHEREAS, Reinsurance Group of America, Incorporated (the "Company")
established the Reinsurance Group of America, Incorporated Flexible Stock Plan
(the "Plan") to enhance the ability of the Company to reward and provide stock
based incentives to its key employees; and
WHEREAS, the Company's shareholders previously approved the Plan and
an amendment thereto; and
WHEREAS, on March 15, 2000,declared thereon by the Board of Directors of the Company
approved an amendmentCorporation from time to time out of funds or other assets of the Plan, subjectCorporation legally available therefor. If at any time a property dividend is to shareholder approval,be paid in rights to increasepurchase shares of the total numbercapital stock of the Corporation (a “rights dividend”), then: (I) if the rights dividend is of rights that entitle the holder thereof to purchase shares authorized for issuance underof Class A Common Stock (or shares of capital stock of the Plan by
1,500,000 shares;Corporation having voting rights equivalent to those of the Class A Common Stock (“Equivalent Class A Shares”)) or Class B Common Stock (or shares of capital stock of the Corporation having voting rights equivalent to those of the Class B Common Stock (“Equivalent Class B Shares”)) (whether initially or upon any adjustment thereunder), then only rights to acquire Class A Common Stock or Equivalent Class A Shares may be paid to holders of Class A Common Stock and WHEREAS,only rights to acquire Class B Common Stock or Equivalent Class B Shares may be paid to holders of Class B Common Stock; and (II) if the Company's shareholders approvedrights dividend is of rights that entitle the amendment on May 24,
2000; and
WHEREAS, on January 29, 2003,holder thereof to purchase shares of capital stock of the Compensation Committee ofCorporation other than Class A Common Stock (or Equivalent Class A Shares) or Class B Common Stock (or Equivalent Class B Shares) (whether initially or upon any adjustment thereunder), then the Board of Directors of the Company approved a second amendmentCorporation may pay such dividend of rights to the Plan,holders of Class A Common Stock and Class B Common Stock in such manner as the Board of Directors may determine. Subject to the foregoing, if and when any property dividend on the New Common Stock is declared payable from time to time by the Board of Directors, the holders thereof shall be entitled to share equally, on a per share basis, in all such dividends and other distributions.(iv) Stock Subdivisions, Splits and Combinations. The Corporation shall not subdivide, split, reclassify or combine stock of either class of New Common Stock without at the same time making a proportionate subdivision, split, reclassification or combination of the other class.
(v) Voting. Voting power shall be divided between the classes of New Common Stock as follows:
(a) With respect to the election of directors, holders of Class A Common Stock and Equivalent Class A Shares together with the holders of any other class or series of stock which by its terms is
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entitled to vote with the Class A Common Stock in the election of directors (the Class A Common Stock and Equivalent Class A Shares, together with such other shares, the “Voting A Shares”), voting separately as a class, shall be entitled to elect that number of directors which constitutes 20% of the authorized number of members of the Board of Directors (or, if such 20% is not a whole number, then the nearest lower whole number of directors that is closest to 20% of such membership) (the “Class A Directors”); provided that, if there shall be a Conversion (as defined in Section C.(viii) of Article Three), then, subject to shareholder approval,the rights of the holders of any then outstanding shares of any other class or series of stock, and except as otherwise provided for herein, the Class A Directors shall constitute 100% of the authorized members of the Board of Directors. Each share of Class A Common Stock shall have one vote in the election of the Class A Directors. Holders of Class B Common Stock and Equivalent Class B Shares, together with the holders of shares of any other class or series of stock which, by its terms, is entitled to vote with the Class B Common Stock in the election of directors (the Class B Common Stock and Equivalent Class B Shares, together with such other shares, the “Voting B Shares”), voting separately as a class, shall be entitled to elect the remaining directors (the “Class B Directors”). Each share of Class B Common Stock shall have one vote in the election of such directors. The initial Class A Directors shall be designated by a majority of the directors of the Corporation as of the effectiveness of these Amended and Restated Articles of Incorporation, and the holders of the Voting A Shares, voting separately as a class, shall be entitled to vote for the election of such Class A Directors at the respective annual meeting(s) of shareholders in which the classes of such Class A Directors are presented to such holders for election. The initial Class B Directors shall be designated by a majority of the directors of the Corporation as of the effectiveness of these Amended and Restated Articles of Incorporation, and the holders of the Voting B Shares, voting separately as a class, shall be entitled to vote for the election of such Class B Directors at the respective annual meeting(s) of shareholders in which the classes of such Class B Directors are presented to such holders for election. For purposes of this Section C.(v)(a) of Article Three, references to the authorized number of members of the Board of Directors shall not include any directors whom the holders of any shares of any series or class of Preferred Stock have the right to elect voting separately as one or more series or class(es). All newly created directorships resulting from an increase in the authorized number of directors shall be allocated between Class A Directors and Class B Directors such that at all times the number of Class B Directors shall be 80% of the authorized number of members of the Board of Directors (or if such 80% is not a whole number, then the nearest higher whole number) and the remaining directorships shall be Class A Directors.
(b) Subject to the last sentence of this Section C.(v)(b) of Article Three, notwithstanding anything to the contrary contained in Section C.(v)(a) of this Article Three, for so long as any person or entity or group of persons or entities acting in concert beneficially owns 15% (the “Threshold Amount”) or more of the outstanding shares of Class B Common Stock, then in any election of directors or other exercise of voting rights with respect to the election or removal of directors, such person, entity or group shall only be entitled to vote (or otherwise exercise voting rights with respect to) a number of shares of Class B Common Stock that constitutes a percentage of the total number of shares authorized for
issuanceof Class B Common Stock then outstanding which is equal to the greater of (i) the Threshold Amount or (ii) such person, entity or group’s Entitled Voting Percentage (such number of shares, the “Voting Cap”), and the Corporation shall disregard any such votes purported to be cast in excess of the Voting Cap. For all purposes hereof, a person, entity or group’s “Entitled Voting Percentage” at any time shall mean the lesser of (X) the percentage at such time of the then outstanding shares of Class A Common Stock beneficially owned by such person, entity or group at such time or (Y) the percentage at such time of the then outstanding Class B Common Stock beneficially owned by such person, entity or group. For purposes of this Section C.(v)(b) of Article Three, a “beneficial owner” of New Common Stock includes any person or entity or group of persons or entities who, directly or indirectly, including through any contract, arrangement, understanding, relationship or otherwise, written or oral, formal or informal, control the voting power (which includes the power to vote or to direct the voting) of such New Common Stock within the
A-4
meaning ofRule 13d-3(a)(1) under the PlanU.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”). To the extent that the voting power of any share of Class B Common Stock cannot be exercised pursuant to this Section C.(v)(b) of Article Three, such share of Class B Common Stock shall not be included in the determination of the voting power of the Corporation for such purposes under these Amended and Restated Articles of Incorporation or the General and Business Corporation Law of Missouri, but shall be deemed to be present and entitled to vote for purposes of determining the presence of a quorum. This Section C.(v)(b) of Article Three shall not apply to (x) any solicitation of any revocable proxy from any stockholder of the Corporation by 1,500,000 shares.
NOW, THEREFORE,or on behalf of the Company hereby amendsCorporation or by any officer or director of the PlanCorporation acting on behalf of the Corporation or (y) any solicitation of any revocable proxy from any stockholder of the Corporation by any other stockholder that is conducted pursuant to, and in accordance with, Regulation 14A promulgated pursuant to the Exchange Act, and is not then reportable on Schedule 13D under the Exchange Act (or any comparable or successor report).
(c) Except as follows:
1. Effectiveotherwise specified herein, the holders of Class A Common Stock and holders of Class B Common Stock (I) shall in all matters not otherwise specified in this Section C.(v) of Article Three vote together, and not separately, as a single class (including, without limitation, with respect to increases or decreases in the authorized number of shares of any class of New Common Stock), with each share of Class A Common Stock and Class B Common Stock having one vote, and (II) shall be entitled to vote as separate classes only when required by law to do so under mandatory statutory provisions that may not be varied, modified, superseded or otherwise overridden in these Amended and Restated Articles of Incorporation.
(d) Except as set forth in this Section C.(v) of this Article Three, the holders of Class A Common Stock shall have exclusive voting power (except for any voting powers of any Preferred Stock) on all matters at any time when no Class B Common Stock is issued and outstanding, and the holders of Class B Common Stock shall have exclusive voting power (except for any voting powers of any Preferred Stock) on all matters at any time when no Class A Common Stock is issued and outstanding.
(vi) Merger, Consolidation or Reorganization. The Corporation shall not enter into any reorganization, or into any merger, share exchange, consolidation or combination of the Corporation with one or more other entities (whether or not the Corporation is the surviving entity), unless each holder of an outstanding share of Class A Common Stock shall be entitled to receive with respect to such share the same kind and amount of consideration (including shares of stock and other securities and property (including cash)), if any, receivable upon such reorganization, merger, share exchange, consolidation or other combination by a holder of an outstanding share of Class B Common Stock, and each holder of an outstanding share of Class B Common Stock shall be entitled to receive with respect to such share the same kind and amount of consideration (including shares of stock and other securities and property (including cash)), if any, receivable upon such reorganization, merger, share exchange, consolidation or other combination by a holder of an outstanding share of Class A Common Stock, in each case without distinction between classes of New Common Stock; provided, however, that the Board of Directors may permit the holders of shares of Class A Common Stock and the holders of shares of Class B Common Stock to receive different kinds of shares of stock in such reorganization, merger, share, exchange, consolidation or combination if the Board of Directors determines in good faith that the only difference in such shares is the inclusion of voting rights that maintain the different voting rights of the holders of Class A Common Stock and holders of Class B Common Stock with respect to the election of the applicable percentage of the authorized number of members of the Board of Directors as described in Section C.(v)(a) of this Article Three.
(vii)Dissolution. In the event of any dissolution, liquidation orwinding-up of the affairs of the Corporation, whether voluntary or involuntary, after payment in full of the amounts required to be paid to the holders of Preferred Stock, the remaining assets and funds of the Corporation shall be distributed pro rata to the holders of the Class A Common Stock and the holders of Class B Common Stock on an equal per share basis, without distinction between classes. For purposes of this Section C.(vii) of this
A-5
Article Three, the voluntary sale, lease, or exchange, mortgage, pledge, transfer or other disposition, in one transaction or a series of transactions (for cash, property, shares or other securities or other obligations of the Corporation or the surviving or new corporation or entity), of all or substantially all of the assets of the Corporation or a consolidation or merger of the Corporation with one or more other constituent corporations or entities (whether or not the Corporation is the entity surviving such consolidation or merger) shall not be deemed to be a dissolution, liquidation orwinding-up, whether voluntary or involuntary.
(viii) Conversion Upon the Occurrence of Certain Events.
(a) Each share of Class B Common Stock shall be converted into one share of Class A Common Stock (“Conversion”) if and only if the Corporation’s Board of Directors determines to submit to the shareholders of the Corporation, at a duly called meeting of shareholders, a proposal to effect such conversion, and such proposal receives the affirmative vote of a majority of the shares of Class A Common Stock and Class B Common Stock entitled to vote and present in person or by proxy at the meeting, each voting separately as a class; provided that, at such meeting of shareholders, every holder of New Common Stock shall be entitled to one vote in person or by proxy for each share of New Common Stock standing in his or her name on the transfer books of the Corporation; and provided further, that such conversion shall be effective on the effective date set forth in such proposal.
(b) In the event of a Conversion, certificates that formerly represented outstanding shares of Class B Common Stock shall thereafter be deemed to represent an equal number of shares of Class A Common Stock, and all authorized shares of Class A Common Stock and Class B Common Stock shall consist of only Common Stock.
(c) The Corporation will provide notice of any Conversion to holders of record of New Common Stock as soon as practicable following such Conversion; provided, however, that the Corporation may satisfy such notice requirement by providing such notice prior to such Conversion. Such notice shall be provided by mailing notice of such Conversion, first class postage prepaid, to each holder of record of the New Common Stock, at such holder’s address as it appears on the transfer books of the Corporation; provided, however, that neither the failure to give such notice nor any defect therein shall affect the validity of the Conversion. Each notice shall state, as appropriate, the following:
(I) the effective date of the Conversion;
(II) that all outstanding shares of Class B Common Stock are converted into Class A Common Stock;
(III) the place or places at which certificates for such shares of Class B Common Stock are to be surrendered for certificates for an equivalent number of shares of Class A Common Stock; and
(IV) that no dividends will be declared on the shares of Class B Common Stock after such Conversion.
(d) Immediately upon such Conversion, the rights of the holders of shares of Class B Common Stock as such shall cease and such holders shall be treated for all purposes as having become the record owners of the shares of Class A Common Stock issued upon such Conversion; provided, however, that such persons shall be entitled to receive when paid any dividends declared on the Class B Common Stock as of a record date preceding the time of such Conversion and unpaid as of the time of such Conversion, subject to Section C.(viii)(e) of this Article Three.
(e) Upon any Conversion, any dividend in the form of Class B Common Stock for which the record date or payment date which may have been declared on the shares of Class B Common Stock shall be deemed to have been declared, and shall be payable, with respect to the shares of Class A Common Stock into or for which such shares of Class B Common Stock shall have been so converted, and any such dividend which shall have been declared on such shares payable in shares of Class B Stock shall be deemed to have been declared, and shall be payable, in shares of Class A Common Stock.
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(f) [Reserved]
(g) The Corporation shall not be required to pay any documentary, stamp or similar issue or transfer taxes payable in respect of the issue or delivery of shares of Class A Common Stock on the Conversion, and no such issue or delivery shall be made unless and until the person requesting such issue has paid to the Corporation the amount of such tax or has established, to the satisfaction of the Corporation, that such tax has been paid.
(h) The Board of Directors shall have the power to authorize the Corporation to purchase or otherwise acquire from time to time shares of any series or class of stock herein or hereafter authorized from such persons, firms, associations or corporations, in such manner and on such terms and for such consideration as the Board of Directors shall from time to time, in its discretion, determine, whether or not less consideration could be paid upon the datepurchase of approvalthe same number of shares of another series or class, and as otherwise permitted by law.
(i) The Board of Directors shall have the power to authorize the Corporation to issue and sell all or any part of any series or class of stock herein or hereafter authorized, from time to time, and at such time or times, in such amounts and manner to such persons, firms, associations or corporations, and for such consideration, whether in cash, property or otherwise, as the Board of Directors shall from time to time, in its discretion, determine, whether or not greater consideration could be received upon the issue or sale of the same number of shares of another series or class, and as otherwise permitted by law.
D. Interpretation. For purposes of these Amended and Restated Articles of Incorporation, for so long as shares of the Class B Common Stock are outstanding, all references in Article Six and Article Nine to “Common Stock” shall be interpreted as references to New Common Stock, and at such time as a deemed restatement of these Amended and Restated Articles of Incorporation shall have occurred pursuant to Section E of this amendment byArticle Three, as references to “Common Stock.”
E. Deemed Restatement of Articles of Incorporation following a Conversion.
(i) Following the Company's shareholders,effectiveness of any Conversion, each of Sections C, D and F and this paragraph (i) of this Section 3.1E of the Plan is amendedthis Article Three shall be deemed to be deleted in its entirety from this Article Three (except for subclauses C.(viii)(d) and (e) hereof to readthe extent that any dividends on the Class B Common Stock shall have been declared but not paid) automatically and without further action by the shareholders or the Corporation, with appropriate renumbering of the remaining sections hereof, and all references to Class B Common Stock in these Amended and Restated Articles of Incorporation shall be references to the New Common Stock, which thereafter shall be designated and referred to as follows:
3.1 the “Common Stock” of the Corporation and the provisions of clause C.(v) of this Article Three shall have no further force or effect. Unless prohibited by the Missouri General and Business Corporation Law, the Corporation may restate these Amended and Restated Articles of Incorporation in their entirety to give effect to this provision, and any such restatement need not include this clause (i) of Paragraph E and may renumberand/or appropriately relocate paragraph E.(ii) within this Article Three.
(ii) Subject to the rights of the holders of Preferred Stock, following the effectiveness of any Conversion, the holders of the Common Stock, voting as a class, shall be entitled to elect all members of the Board of Directors.
F. Amendment to this Article Three. Except as otherwise provided by law, and subject to any rights of the holders of Preferred Stock, the affirmative vote of the holders of at least a majority of the then outstanding shares of Class A Common Stock and the Class B Common Stock, voting together as a single class, shall be required to amend, alter, change or repeal the provisions of this Article Three; provided, however, that with respect to any proposed amendment which would amend, alter, change or repeal the powers, preferences or special rights of the Class A Common Stock or Class B Common Stock so as to affect them adversely, the affirmative vote of the holders of at least a majority of the outstanding shares of the class affected by the proposed amendment, voting separately as a class, shall be obtained in addition to the affirmative vote of the holders of at least a majority of the Class A Common Stock and Class B Common Stock, voting together as a single class as provided above.
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ARTICLE FOUR
ADDITIONAL PROVISIONS REGARDING CERTAIN SHAREHOLDER RIGHTS A. Preemptive Rights. All preemptive rights of shareholders are hereby denied, so that no stock or other security of the Corporation shall carry with it and no holder or owner of any share or shares of stock or other security or securities of the Corporation shall have any preferential or preemptive right to acquire additional shares of stock or any other security of the Corporation. B. Cumulative Voting. All cumulative voting rights are hereby denied, so that none of the Common Stock, the Preferred Stock or any other security of the Corporation shall carry with it and no holder or owner of any Common Stock, Preferred Stock or any other security shall have any right to cumulative voting in the election of directors or for any other purpose. ARTICLE FIVE
INCORPORATOR The name and place of residence of the incorporator is: Donna J. Holsten
6140 Wanda
St. Louis, Missouri 63116 ARTICLE SIX
DIRECTORS A. Number and Classes of Shares.Directors. The number of Shares which may be
----------------
issued or sold or for which Options, SARs or Performance
Shares may be granted under the Plan shall be 6,260,077
Shares. Such number of Shares shall increase annually,
effective as of the first day of each Fiscal Year, by the
number of Shares equaldirectors to 5% of the number of Shares
allocated to this Plan as of the first day of such Fiscal
Year. Such Shares may be authorized but unissued Shares,
Shares held in the treasury, or both.
2. Capitalized terms used herein shall have the same meanings
ascribed to them in the Plan.
IN WITNESS WHEREOF, Reinsurance Group of America, Incorporated hereby
adopts the foregoing amendment this 28th day of May, 2003.
REINSURANCE GROUP OF AMERICA, INCORPORATED
By: /s/ A. Greig Woodring
-------------------------------------
A. Greig Woodring, President and
Chief Executive Officer
AMENDMENT TO THE
REINSURANCE GROUP OF AMERICA, INCORPORATED
FLEXIBLE STOCK PLAN
AS AMENDED AND RESTATED EFFECTIVE JULY 1, 1998
WHEREAS, Reinsurance Group of America, Incorporated (the "Company")
established the Reinsurance Group of America, Incorporated Flexible Stock Plan
(the "Plan") to enhance the ability of the Company to reward and provide stock
based incentives to its key employees; and
WHEREAS, the Company's shareholders previously approved the Plan and
an amendment thereto; and
WHEREAS, on March 15, 2000,constitute the Board of Directors of the Company
approved a second amendmentCorporation is ten. Thereafter, the number of directors shall be fixed by, or in the manner provided in, the Bylaws of the Corporation. The Board of Directors shall be divided into three classes, as nearly equal in number as possible, with the mode of such classification to be provided for in the Bylaws of the Corporation. Directors other than certain Directors elected to the Plan, subjectinitial Board of Directors shall be elected to shareholder approval, to
increasehold office for a term of three years, with the term of office of one class expiring each year. As used in these Articles of Incorporation, the term “entire Board of Directors” means the total number of Directors fixed by, or in accordance with, these Articles of Incorporation or the Bylaws of the Corporation. B. Removal of Directors. Subject to the rights, if any, of the holders of any class of capital stock of the Corporation (other than the Common Stock) then outstanding, (1) any Director, or the entire Board of Directors, may be removed from office at any time prior to the expiration of his term of office only for cause and only by the affirmative vote of the holders of record of outstanding shares authorizedrepresenting at least 85% of all of the then outstanding shares of capital stock of the Corporation then entitled to vote generally in the election of Directors, voting together as a single class at a special meeting of shareholders called expressly for issuance underthat purpose (such vote being in addition to any required class or other vote); and (2) any Director may be removed from office by the Planaffirmative vote of a majority of the entire Board of Directors at any time prior to the expiration of his term of office, as provided by 1,500,000 shares.
NOW, THEREFORE,law, in the Company hereby amendsevent that the PlanDirector fails to meet any qualifications stated in the Bylaws for election as follows:
1. Effective upona Director or in the event that the Director is in breach of any agreement between the Director and the Corporation relating to the Director’s service as a Director or employee of the Corporation. C. Nominations. Subject to the rights, if any, of holders of any class of capital stock of the Corporation (other than the Common Stock) then outstanding, nominations for the election of Directors may be made by the affirmative vote of a majority of the entire Board of Directors or by any shareholder of record entitled to vote generally in the election of Directors. Any shareholder who otherwise desires to nominate one or more persons for election as a Director at any meeting of shareholders held at any time may do so only if the shareholder has delivered timely notice of the shareholder’s intent to make such nomination or nominations,
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either by personal delivery or by United States mail, postage prepaid, to the Secretary of the Corporation not less than 60 days nor more than 90 days prior to the meeting; provided, however, that if less than 70 days’ notice or prior public disclosure of the date of approval of this amendmentthe meeting is given or made to shareholders, such notice by the Company's shareholders, Section 3.1shareholder to be timely must be received not later than the close of business on the 10th day following the day on which the notice of the Plandate of meeting was mailed or public disclosure was made, whichever occurs first. A shareholder’s notice to the Secretary shall set forth: (1) the name and address of record of the shareholder who intends to make the nomination; (2) a representation that the shareholder is amendeda holder of record of shares of capital stock of the Corporation entitled to vote at the meeting and intends to appear in its entiretyperson or by proxy at the meeting to read as follows:
3.1 Number of Shares. Thenominate the person or persons specified in the notice; (3) the class and number of Sharesshares of the capital stock that are beneficially owned by the shareholder on the date of such notice; (4) the name, age, business and residential address, and principal occupation or employment of each proposed nominee; (5) the class and number of shares of capital stock that are beneficially owned by such nominee on the date of such notice; (6) a description of all arrangements or understandings between the shareholder and each nominee and the name of any other person or persons pursuant to which the nomination or nominations are to be made by the shareholder; (7) any other information regarding each proposed nominee that would be required to be included in a proxy statement filed pursuant to the proxy rules of the Securities and Exchange Commission; and (8) the written consent of each proposed nominee to being named as a nominee in the proxy statement and to serve as a Director of the Corporation if so elected. The Corporation may be
----------------
issued or sold or for which Options, SARs or Performance
Sharesrequire any proposed nominee to furnish any other information it may be granted underreasonably require to determine the Planeligibility of the proposed nominee to serve as a Director of the Corporation. The presiding officer of the meeting may, if the facts warrant, determine that a nomination was not made in accordance with the foregoing procedure, and if he should make that determination, he shall so declare at the meeting and the defective nomination shall be 3,486,564
Shares. Such number of Shares shall increase annually,
effective asdisregarded. D. Vacancies. Subject to the rights, if any, of the first dayholders of each Fiscal Year,
commencing withany class of capital stock of the Fiscal Year beginningCorporation (other than the Common Stock) then outstanding, any vacancies in 2001,the Board of Directors which occur for any reason prior to the expiration of the term of office of the class in which the vacancy occurs, including vacancies which occur by reason of an increase in the number of Shares equal to 5%Directors, shall be filled only by the Board of Directors, acting by the affirmative vote of a majority of the remaining Directors then in office (although less than a quorum). ARTICLE SEVEN
DURATION The duration of the Corporation is perpetual. ARTICLE EIGHT
PURPOSES The Corporation is formed for the following purposes: 1. To purchase, take, receive, subscribe or otherwise acquire, own, hold, use, employ, sell, mortgage, loan, pledge, or otherwise dispose of, and otherwise deal in and with the shares or other interests in, or obligations of, other domestic and foreign corporations, associations, partnerships or individuals; 2. To be a general or limited partner in any general or limited partnership; 3. To take such actions and transact such other business as are incidental to and connected with the purposes set forth above; and 4. To do anything permitted of corporations pursuant to the provisions of The General and Business Corporation Law of Missouri, as amended from time to time.
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ARTICLE NINE SHAREHOLDERS’ MEETINGS A. Special Meetings. A special meeting of the shareholders may be called only by the Board of Directors pursuant to a resolution adopted by the affirmative vote of a majority of the entire Board of Directors or by the Chairman of the Board of Directors or the President. Only such business shall be conducted, and only such proposals shall be acted upon, as are specified in the call of any special meeting of shareholders. B. Annual Meetings. At any annual meeting of shareholders only such business shall be conducted, and only such proposals shall be acted upon, as shall have been properly brought before the meeting by the Board of Directors or by a shareholder of record entitled to vote at such meeting. For a proposal to be properly brought before an annual meeting by a shareholder, the shareholder must have given timely notice, either by personal delivery or by United States mail, postage prepaid, to the Secretary of the Corporation not less than 60 days nor more than 90 days prior to the annual meeting; provided, however, that if less than 70 days’ notice or prior public disclosure of the date of the annual meeting is given or made to shareholders, notice by the shareholder to be timely must be received not later than the close of business on the 10th day following the earlier of (1) the day on which notice of the date of the annual meeting was mailed or (2) the day on which public disclosure was made. A shareholder’s notice to the Secretary shall set forth as to each matter the shareholder proposes to bring before the annual meeting: (a) a brief description of the proposal desired to be brought before the annual meeting and the reasons for conducting this business at the annual meeting; (b) the name and address of record of the shareholder proposing the business and any other shareholders known by such shareholder to be supporting the proposal; (c) the class and number of Shares
allocatedshares of the capital stock which are beneficially owned by the shareholder on the date of the shareholder notice and by any other shareholders known by such shareholder to be supporting the proposal on the date of the shareholder notice; and (d) any material interest of the shareholder in the proposal. The Board of Directors may reject any shareholder proposal submitted for consideration at the annual meeting which is not made in accordance with the terms of this Article Nine or which is not a proper subject for shareholder action in accordance with provisions of applicable law. Alternatively, if the Board of Directors fails to consider the validity of any shareholder proposal, the presiding officer of the annual meeting may, if the facts warrant, determine and declare at the annual meeting that the shareholder proposal was not made in accordance with the terms of this Article Nine and, if he should make that determination, he shall so declare at the meeting and the business or proposal shall not be acted upon. This provision shall not prevent the consideration and approval or disapproval at the annual meeting of reports of officers, directors and committees of the Board of Directors, but, in connection with such reports, no new business shall be acted upon at the meeting unless stated, filed and received as herein provided. C. Action by Written Consent. Any action required or permitted to be taken by the shareholders of the Corporation may, if otherwise allowed by law, be taken without a meeting of shareholders only if consents in writing, setting forth the action so taken, are signed by all of the shareholders entitled to vote with respect to the subject matter thereof. ARTICLE TEN
AMENDMENT OF BYLAWS The Bylaws of the Corporation may be amended, altered, changed or repealed, and a provision or provisions inconsistent with the provisions of the Bylaws as they exist from time to time may be adopted, only by the majority of the entire Board of Directors.
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ARTICLE ELEVEN
AMENDMENT OF ARTICLES OF INCORPORATION The Corporation reserves the right to amend, alter, change or repeal any provision contained in these Articles of Incorporation in the manner now or hereafter prescribed by law, and all rights and powers conferred herein on the shareholders, directors and officers of the Corporation are subject to this Plan asreserved power; provided, that (in addition to any required class or other vote) the affirmative vote of the first dayholders of record of outstanding shares representing at least 85% of all of the outstanding shares of capital stock of the Corporation then entitled to vote generally in the election of Directors, voting together as a single class, shall be required to amend, alter, change or repeal, or adopt any provision or provisions inconsistent with, Articles Four, Six, Nine, Ten, Twelve, or this Article Eleven of these Articles of Incorporation. ARTICLE TWELVE
INDEMNIFICATION AND RELATED MATTERS A. Actions Involving Directors and Officers. The Corporation shall indemnify each person (other than a party plaintiff suing on his own behalf or in the right of the Corporation) who at any time is serving or has served as a director or officer of the Corporation against any claim, liability or expense incurred as a result of this service, or as a result of any other service on behalf of the Corporation, or service at the request of the Corporation as a director, officer, employee, member or agent of another corporation, partnership, joint venture, trust, trade or industry association or other enterprise (whether incorporated or unincorporated, for-profit or not-for-profit), to the maximum extent permitted by law. Without limiting the generality of the foregoing, the Corporation shall indemnify any such person who was or is a party (other than a party plaintiff suing on his own behalf or in the right of the Corporation), or is threatened to be made a party, to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (including, but not limited to, an action by or in the right of the Corporation) by reason of such Fiscal
Year.service against expenses (including, without limitation, attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding. B. Actions Involving Employees or Agents. 1. The Corporation may, if it deems appropriate and as may be permitted by this Article, indemnify any person (other than a party plaintiff suing on his own behalf or in right of the Corporation) who at any time is serving or has served as an employee or agent of the Corporation against any claim, liability or expense incurred as a result of such service or as a result of any other service on behalf of the Corporation, or service at the request of the Corporation as a director, officer, employee, member or agent of another corporation, partnership, joint venture, trust, trade or industry association or other enterprise (whether incorporated or unincorporated, for-profit or not-for-profit), to the maximum extent permitted by law or to such lesser extent as the Corporation, in its discretion, may deem appropriate. Without limiting the generality of the foregoing, the Corporation may indemnify any such person who was or is a party (other than a party plaintiff suing on his own behalf or in the right of the Corporation), or is threatened to be made a party, to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (including, but not limited to, an action by or in the right of the Corporation) by reason of such service against expenses (including, without limitation, attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with the action, suit or proceeding. 2. To the extent that an employee or agent of the Corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in Section B (1) of this Article, or in defense of any claim, issue or matter therein, he shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by him in connection with the action, suit or preceding. C. Determination of Right to Indemnification in Certain Circumstances. Any indemnification required under Section A of this Article or authorized by the Corporation in a specific case pursuant to Section B of this Article (unless ordered by a court) shall be made by the Corporation unless a determination is made
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reasonably and promptly that indemnification of the director, officer, employee or agent is not proper under the circumstances because he has not met the applicable standard of conduct set forth in or established pursuant to this Article. Such Sharesdetermination shall be made (1) by the Board of Directors by a majority vote of a quorum consisting of Directors who were not parties to such action, suit or proceeding, or (2) if such a quorum is not obtainable, or even if obtainable a quorum of disinterested directors so directs, by independent legal counsel in a written opinion, or (3) by majority vote of the shareholders; provided that no such determination shall preclude an action brought in an appropriate court to challenge such determination. D. Advance Payment of Expenses. Expenses incurred by a person who is or was a director or officer of the Corporation in defending a civil or criminal action, suit or proceeding shall be paid by the Corporation in advance of the final disposition of an action, suit or proceeding, and expenses incurred by a person who is or was an employee or agent of the Corporation in defending a civil or criminal action, suit or proceeding may be paid by the Corporation in advance of the final disposition of such action, suit or proceeding as authorized by or at the direction of the Board of Directors, in either case upon receipt of an undertaking by or on behalf of the director, officer, employee or agent to repay such amount if it shall ultimately be determined that he is not entitled to be indemnified by the Corporation as authorized in or pursuant to this Article. E. Not Exclusive Right. The indemnification provided by this Article shall not be deemed exclusive of any other rights to which those seeking indemnification may be entitled, whether under the Bylaws of the Corporation or any statute, agreement, vote of shareholders or disinterested directors or otherwise, both as to action in an official capacity and as to action in another capacity while holding such office. F. Indemnification Agreements Authorized. Without limiting the other provisions of this Article, the Corporation is authorized from time to time, without further action by the shareholders of the Corporation, to enter into agreements with any director, officer, employee or agent of the Corporation providing such rights of indemnification as the Corporation may deem appropriate, up to the maximum extent permitted by law. Any agreement entered into by the Corporation with a director may be authorized but unissued Shares,
Shares heldby the other directors, and such authorization shall not be invalid on the basis that similar agreements may have been or may thereafter be entered into with other directors. G. Standard of Conduct. Except as may otherwise be permitted by law, no person shall be indemnified pursuant to this Article (including without limitation pursuant to any agreement entered into pursuant to Section F of this Article) from or on account of such person’s conduct which is finally adjudged to have been knowingly fraudulent, deliberately dishonest or willful misconduct. The Corporation may (but need not) adopt a more restrictive standard of conduct with respect to the indemnification of any employee or agent of the Corporation. H. Insurance. The Corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the Corporation, or who is or was otherwise serving on behalf or at the request of the Corporation against any claim, liability or expense asserted against him and incurred by him in any such capacity, or arising out of his status as such, whether or not the treasury, or both.
2. Capitalized terms used herein shallCorporation would have the same meanings
ascribedpower to them inindemnify him against such liability under the Plan.
IN WITNESS WHEREOF, Reinsurance Group of America, Incorporated hereby
adopts the foregoing amendment this 16th day of March, 2000.
REINSURANCE GROUP OF AMERICA, INCORPORATED
By: /s/ A. Greig Woodring
-------------------------------------
A. Greig Woodring, President and
Chief Executive Officer
REINSURANCE GROUP OF AMERICA, INCORPORATED
FLEXIBLE STOCK PLAN
AS AMENDED AND RESTATED EFFECTIVE JULY 1, 1998
REINSURANCE GROUP OF AMERICA, INCORPORATED
FLEXIBLE STOCK PLAN
TABLE OF CONTENTS
Page
----
ARTICLE I - NAME AND PURPOSE
1.1 Name 1
1.2 Purpose 1
ARTICLE II - DEFINITIONS OF TERMS AND RULES OF CONSTRUCTION
2.1 General Definitions 1
(a) Affiliate 1
(b) Agreement 1
(c) Benefit 1
(d) Board 1
(e) Cash Award 1
(f) Change of Control 1
(g) Code 1
(h) Company 1
(i) Committee 1
(j) Common Stock 2
(k) Effective Date 2
(l) Employee 2
(m) Employer 2
(n) Exchange Act 2
(o) Fair Market Value 2
(p) Fiscal Year 2
(q) ISO 2
(r) NQSO 2
(s) Option 2
(t) Other Stock Based Award 2
(u) Parent 2
(v) Participant 2
(w) Performance Share 2
(x) Plan 2
(y) Restricted Stock 3
(z) Rule 16b-3 3
(aa) SEC 3
(bb) Share 3
(cc) SAR 3
(dd) Subsidiary 3
2.2 Other Definitions 3
2.3 Conflicts in Plan 3
ARTICLE III - COMMON STOCK
3.1 Number of Shares 3
3.2 Reusage 3
3.3 Adjustments 3
ARTICLE IV - ELIGIBILITY
4.1 Determined By Committee 4
ii
ARTICLE V - ADMINISTRATION
5.1 Committee 4
5.2 Authority 4
5.3 Delegation 5
5.4 Adjudication of Claims 5
ARTICLE VI - AMENDMENT
6.1 Power of Board 5
6.2 Limitation 5
ARTICLE VII - TERM AND TERMINATION
7.1 Term 6
7.2 Termination 6
ARTICLE VIII - MODIFICATION OR TERMINATION OF BENEFITS
8.1 General 6
8.2 Committee's Right 6
ARTICLE IX - CHANGE OF CONTROL
9.1 Right of Committee 6
ARTICLE X - AGREEMENTS AND CERTAIN BENEFITS
10.1 Grant Evidenced by Agreement 7
10.2 Provisions of Agreement 7
10.3 Certain Benefits 7
ARTICLE XI - REPLACEMENT AND TANDEM AWARDS
11.1 Replacement 7
11.2 Tandem Awards 7
ARTICLE XII - PAYMENT, DIVIDENDS, DEFERRAL AND WITHHOLDING
12.1 Payment 7
12.2 Dividend Equivalents 8
12.3 Deferral 8
12.4 Withholding 8
ARTICLE XIII - OPTIONS
13.1 Types of Options 8
13.2 Shares for ISOs 8
13.3 Grant of ISOs and Option Price 8
13.4 Other Requirements for ISOs 8
13.5 NQSOs 8
13.6 Determination by Committee 8
13.7 Limitation Shares Covered by Options 9
ARTICLE XIV - SARS
14.1 Grant and Payment 9
14.2 Grant of Tandem Award 9
14.3 ISO Tandem Award 9
14.4 Payment of Award 9
14.5 Limitation on SARs. 9
iii
ARTICLE XV - RESTRICTED STOCK
15.1 Description 9
15.2 Cost of Restricted Stock 9
15.3 Non-Transferability 10
ARTICLE XVI - PERFORMANCE SHARES
16.1 Description 10
16.2 Grant 10
ARTICLE XVII - CASH AWARDS
17.1 Grant 10
17.2 Limitation on Amount 10
17.3 Restrictions 10
ARTICLE XVIII - OTHER STOCK BASED AWARDS AND OTHER BENEFITS
18.1 Other Stock Based Awards 10
18.2 Other Benefits 10
ARTICLE XIX - MISCELLANEOUS PROVISIONS
19.1 Underscored References 10
19.2 Number and Gender 11
19.3 Governing Law 11
19.4 Purchase for Investment 11
19.5 No Employment Contract 11
19.6 No Effect on Other Benefits 11
iv
REINSURANCE GROUP OF AMERICA, INCORPORATED
FLEXIBLE STOCK PLAN
ARTICLE I
---------
NAME AND PURPOSE
----------------
1.1 Name. The nameprovisions of this Plan isArticle. I. Certain Definitions. For the "Reinsurance Grouppurposes of ----
America, Incorporated Flexible Stock Plan."
1.2 Purpose. The Company has established this Plan to attract,
-------
retain, motivate and reward Employees and other individuals, to encourage
ownershipArticle: 1. Any director or officer of the Company's Common Stock by Employees andCorporation who shall serve as a director, officer or employee of any other individuals,
andcorporation, partnership, joint venture, trust or other enterprise of which the Corporation, directly or indirectly, is or was the owner of 20% or more of either the outstanding equity interests or the outstanding voting stock (or comparable interests), shall be deemed to promote and furtherbe so serving at the best interestsrequest of the Company by granting cash
and other awards.
ARTICLE II
----------
DEFINITIONS OF TERMS AND RULES OF CONSTRUCTION
----------------------------------------------
2.1 General Definitions. The following words and phrases, when
-------------------
used in the Plan, unless otherwise specifically defined orCorporation, unless the context
clearly otherwise requires, shall have the following respective meanings:
(a) Affiliate. A Parent or Subsidiary of the Company.
---------
(b) Agreement. The document which evidences the grant of any
---------
Benefit under the Plan and which sets forth the Benefit and the
terms, conditions and provisions of, and restrictions relating to, such
Benefit.
(c) Benefit. Any benefit granted to a Participant under the
-------
Plan.
(d) Board. The Board of Directors of the Company.
-----
(e) Cash Award. A Benefit payableCorporation shall determine otherwise. In all other instances where any person shall serve as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise of which the Corporation is or was a shareholder or creditor, or in which it is or was otherwise interested, if it is not otherwise established that such person is or was serving as a director, officer, employee or agent at the request of the Corporation, the Board of Directors of the Corporation may determine whether such service is or was at the request of the Corporation, and it shall not be necessary to show any actual or prior request for such service.
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2. References to a corporation include all constituent corporations absorbed in a consolidation or merger as well as the resulting or surviving corporation so that any person who is or was a director, officer, employee or agent of a constituent corporation or is or was serving at the request of a constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise shall stand in the formsame position under the provisions of cash.
----------
(f) Change of Control.this Article with respect to the resulting or surviving corporation as he would if he had served the resulting or surviving corporation in the same capacity. 3. The acquisition,term “other enterprise” shall include, without limitation, employee benefit plans and voting or taking action with respect to stock or other assets therein; the approval of
-----------------term “serving at the Board, by any person or entity, other than the Company or a Related
Entity, of more than 20%request of the outstanding Shares throughcorporation” shall include, without limitation, any service as a tender offer,
exchange offerdirector, officer, employee or otherwise; the liquidation or dissolutionagent of the Company
followingcorporation which imposes duties on, or involves services by, a saledirector, officer, employee or other disposition of all or substantially all of its
assets; a merger or consolidation involving the Company which results in the
Company not being the surviving parent corporation; or any time during any
two-year period in which individuals who constituted the Board at the start of
such period (or whose election was approved by at least two-thirds of the then
members of the Board who were members at the start of the two-year period) do
not constitute at least 50% of the Board for any reason. A Related Entity is
the Parent, a Subsidiary oragent with respect to any employee benefit plan, its participants, or beneficiaries; and a person who acted in good faith and in a manner he reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have satisfied any standard of care required by or pursuant to this Article in connection with such plan; the term “fines” shall include, without limitation, any excise taxes assessed on a person with respect to an employee benefit plan and shall also include any damages (including treble damages) and any other civil penalties. J. Survival. Any indemnification rights provided pursuant to this Article shall continue as to a trust
formingperson who has ceased to be a partdirector, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such a plan) maintainedperson. Notwithstanding any other provision in these Articles of Incorporation, any indemnification rights arising under or granted pursuant to this Article shall survive amendment or repeal of this Article with respect to any acts or omissions occurring prior to the effective time of such amendment or repeal and persons to whom such indemnification rights are given shall be entitled to rely upon such indemnification rights with respect to such acts or omissions as a binding contract with the Corporation. K. Liability of the Directors. It is the intention of the Corporation to limit the liability of the directors of the Corporation, in their capacity as such, whether to the Corporation, its shareholders or otherwise, to the fullest extent permitted by law. Consequently, should The General and Business Corporation Law of Missouri or any other applicable law be amended or adopted hereafter so as to permit the elimination or limitation of such liability, the liability of the directors of the Corporation shall be so eliminated or limited without the need for amendment of these Articles or further action on the part of the shareholders of the Corporation. ARTICLE THIRTEEN
EXCULPATION The liability of the Corporation’s directors to the Corporation or any of its shareholders for monetary damages for breach of fiduciary duty as a director shall be eliminated to the fullest extent permitted under the Missouri General and Business Corporation Law. Any repeal or modification of this Article Thirteen by the Parent,shareholders of the CompanyCorporation shall not adversely affect any right or protection of a Subsidiary.
(g) Code. Thedirector of the Corporation existing at the time of such repeal or modification with respect to acts or omissions occurring prior to such repeal or modification. ARTICLE FOURTEEN
FIVE PERCENT OWNERSHIP A. In order to preserve the Tax Benefits to which the Corporation or any direct or indirect subsidiary thereof is entitled pursuant to the Internal Revenue Code of 1986, as amended. Any
----
referenceamended, or any successor statute (the
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“Code”) and the Treasury Regulations promulgated thereunder, the Corporation Securities shall be subject to the Code includesfollowing restrictions: (i) Certain Definitions. For purposes of this Article Fourteen, the regulations promulgatedfollowing terms shall have the meanings indicated (and any references to any portions of Treasury Regulation § 1.382-2T shall include any successor provisions): (a) “5% Transaction”means any Transfer or purported Transfer of Corporation Securities described in Section A.(ii) of this Article Fourteen, which Transfer is prohibitedand/or void under the provisions of such Section A.(ii) of this Article Fourteen. (b) “Additional Split-Off”has the meaning set forth in the Recapitalization and Distribution Agreement. (c) “Agent” means any agent designated by the Board of Directors of the Corporation pursuant to Section B.(ii) of this Article Fourteen. (d) “Corporation Securities” means (I) shares of New Common Stock, (II) shares of Preferred Stock (other than preferred stock described in Section 1504(a)(4) of the Code), (III) warrants, rights, or options (including options within the meaning of Treasury Regulation § 1.382-2T(h)(4)(v)) to purchase stock (other than preferred stock described in Section 1504(a)(4) of the Code) of the Corporation, and (IV) any other interest that would be treated as “stock” of the Corporation pursuant to Treasury Regulation § 1.382-2T(f)(18). (e) “Debt Exchange” has the meaning set forth in the Recapitalization and Distribution Agreement. (f) “Excess Securities”has the meaning set forth in subsection B.(i) of this Article Fourteen. (g) “End Date” has the meaning set forth in the Recapitalization and Distribution Agreement. (h) “Five-Percent Shareholder” means a Person or group of Persons that is a “5-percent shareholder” of the Corporation pursuant to Treasury Regulation § 1.382-2T(g). (i) “MetLife” means MetLife, Inc., a Delaware corporation. (j) “Percentage Stock Ownership” means the percentage stock ownership interest as determined in accordance with Treasury Regulation § 1.382-2T(g), (h), (j) and (k). (k) “Permitted Transfer” means a Transfer of Corporation Securities (A) after the Restriction Release Date, (B) pursuant to any (1) merger, consolidation or similar transaction approved in advance by the Board of Directors or (2) tender or exchange offer made pursuant to the Code.
(h) Company. Reinsurance Groupapplicable rules and regulations of America, Incorporated.
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(i) Committee. The Committee describedthe Exchange Act, for any or all outstanding New Common Stock in Section 5.1.
---------
1
(j) Common Stock. Anywhich a majority of each class of the Company's common stock.
------------
(k) Effective Date. Theoutstanding New Common Stock has been validly tendered and not withdrawn and in which offer the offeror or an affiliate thereof has committed to consummate a merger with the Corporation in which all of the New Common Stock not so acquired in such offer is (subject to any applicable dissenters’ rights) converted into the same type and amount of consideration paid for New Common Stock accepted in such tender or exchange offer, (C) pursuant to the exercise of any option or warrant outstanding on the effective date thatof these Amended and Restated Articles of Incorporation to purchase Corporation Securities from the Plan is approvedCorporation, (D) pursuant to the Split-Off or any Additional Split-Off or any Public Debt Exchange, (E) any issuance of Corporation Securities by the --------------Corporation or any of its subsidiaries, or (F) pursuant to any Private Debt Exchange, the Transfer from MetLife ofOld Class B Common Stock to its immediate transferees, but not to the transferees of such immediate transferees. (l) “Person” shall mean any individual, firm, corporation, partnership, trust association, limited liability company, limited liability partnership, or other entity, or any group of Persons making a “coordinated acquisition” of shares or otherwise treated as an entity within the meaning of Treasury
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Regulation § 1.382-3(a)(1), or otherwise and shall include any successor (by merger or otherwise) of any such entity. (m) “Private Debt Exchange” has the meaning set forth in the Recapitalization and Distribution Agreement. (n) “Prohibited Distribution” has the meaning set forth in subsection B.(ii) of this Article Fourteen. (o) “Public Debt Exchange” has the meaning set forth in the Recapitalization and Distribution Agreement. (p) “Purported Transferee” has the meaning set forth in subsection B.(i) of this Article Fourteen. (q) “Prohibited Transfer” means any 5% Transaction (other than a Permitted Transfer). (r) “Recapitalization and Distribution Agreement” means the Recapitalization and Distribution Agreement, dated as of June 1, 2008, by and between the Corporation and MetLife, as it may be amended from time to time. (s) “Restriction Release Date” means the earlier of (x) September 13, 2011, or (y) such other date as the Board of Directors may determine in good faith that this Article Fourteen is no longer in the best interests of the Corporation and its shareholders. (t) “Section 382” means Section 382 of the Code, or any comparable successor provision. (u) “Split-Off” has the meaning set forth in the Recapitalization and Distribution Agreement. (v) “Tax Benefit” means the net operating loss carryovers, capital loss carryovers, general business credit carryovers, alternative minimum tax credit carryovers and foreign tax credit carryovers, as well as any loss or deduction attributable to a “net unrealized built-in loss” within the meaning of Section 382, of the Corporation or any direct or indirect subsidiary thereof. (w) “Transfer” means any direct or indirect sale, transfer, assignment, exchange, issuance, grant, redemption, repurchase, conveyance, pledge or other disposition, whether voluntary or involuntary, and whether by operation of law or otherwise, by any Person other than the Corporation. A Transfer also shall include the creation or grant of an option, warrant or right (including an option within the meaning of TreasuryRegulation Section 1.382-4(d)(9)) by any Person other than the Corporation, but only if such option, warrant or right would be deemed exercised pursuant to TreasuryRegulation Section 1.382-4(d)(2)(i). (ii) Transfer Restrictions. Any attempted Transfer of Corporation Securities prior to the Restriction Release Date, or any attempted Transfer of Corporation Securities pursuant to an agreement entered into prior to the Restriction Release Date, that is not a Permitted Transfer shall be prohibited and voidab initioinsofar as it purports to transfer ownership or rights in respect of such Corporation Securities to the Purported Transferee to the extent that, as a result of such Transfer (or any series of Transfers of which such Transfer is a part), either (1) any Person or group of Persons shall become a Five-Percent Shareholder other than by reason of TreasuryRegulation Section 1.382-2T(j)(3)(i), or (2) the Percentage Stock Ownership interest in the Corporation of any Five-Percent Shareholder shall be increased. (iii) The restrictions set forth in Section A.(ii) of this Article Fourteen shall not apply to an attempted Transfer that is a 5% Transaction if the transferor or the transferee obtains the prior written approval of the Board of Directors or a duly authorized committee thereof. In considering whether to approve any such transfer, the Board of Directors may take into account both the proposed Transfer and potential future Transfers. The Board of Directors may exercise the authority granted by this Section A(iii) of this Article Fourteen through duly authorized officers or agents of the Corporation.
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(iv) Each certificate representing shares of Corporation Securities issued prior to the Restriction Release Date shall contain the legend set forth below, evidencing the restrictions set forth in this Section A of this Article Fourteen and Sections B and C of this Article Fourteen: “The transfer of securities represented by this certificate is (and other securities of the Corporation may be) subject to restriction pursuant to Article Fourteen of the Corporation’s Amended and Restated Articles of Incorporation. The Corporation will furnish a copy of its Amended and Restated Articles of Incorporation setting forth the powers, designations, preferences and relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferencesand/or rights to the holder of record of this Certificate without charge upon written request addressed to the Corporation at its principal place of business.” With respect to any shares of Corporation Securities that are not evidenced by a certificate, but are uncertificated securities, the foregoing legend shall be set forth in the initial statement of holdings. B. Treatment of Excess Securities. (i) No employee or agent of the Corporation shall record any Prohibited Transfer, and the purported transferee of such a Prohibited Transfer (the “Purported Transferee”) shall not be recognized as a shareholder of the Corporation for any purpose whatsoever in respect of the Corporation Securities which are the subject of the Prohibited Transfer (the “Excess Securities”). Until the Excess Securities are acquired by another Person in a Transfer that is not a Prohibited Transfer, such Purported Transferee shall not be entitled with respect to such Excess Securities to any rights of shareholders of the Company which must occur within one year beforeCorporation, including, without limitation, the right to vote such Excess Securities or after
approvalto receive dividends or distributions, whether liquidating or otherwise, in respect thereof, if any; provided, however, that the Transferor of such Excess Securities shall not be required to disgorge, and shall be permitted to retain for its own account, any proceeds of such Transfer, and shall have no further rights, responsibilities, obligations or liabilities with respect to such Excess Securities, if such Transfer was a Prohibited Transfer. Once the Excess Securities have been acquired in a Transfer that is not a Prohibited Transfer, the Corporation Securities shall cease to be Excess Securities. For this purpose, any transfer of Excess Securities not in accordance with the provisions of this Section B of this Article Fourteen shall also be a Prohibited Transfer. (ii) If the Corporation determines that a Transfer of Corporation Securities constitutes a Prohibited Transfer then, upon written demand by the Board. Any grantsCorporation, the Purported Transferee shall transfer or cause to be transferred any certificate or other evidence of Benefits priorownership of the Excess Securities within the Purported Transferee’s possession or control, together with any dividends or other distributions that were received by the Purported Transferee from the Corporation with respect to the approvalExcess Securities (“Prohibited Distributions”), to the Agent designated by the shareholdersBoard of Directors. The Agent shall thereupon sell to a buyer or buyers, which may include the Company shall be void if such approval is not obtained.
(l) Employee. Any person employed byCorporation, the Employer.
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(m) Employer. The Company and all Affiliates.
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(n) Exchange Act. TheExcess Securities Exchange Act of 1934, as
------------
amended.
(o) Fair Market Value. The closing price of Shares ontransferred to it in one or more arm’s length transactions (over the New
----------------- York Stock Exchange on a given date, or other national securities exchange, if possible, or otherwise privately); provided, however, that the Agent shall effect such sale or sales in an orderly fashion and shall not be required to effect any such sale within any specific timeframe if, in the absenceAgent’s discretion, such sale or sales would disrupt the market for the Corporation Securities or otherwise would adversely affect the value of the Corporation Securities. If the Purported Transferee has resold the Excess Securities before receiving the Corporation’s demand to surrender Excess Securities to the Agent, the Purported Transferee shall be deemed to have sold the Excess Securities for the Agent, and shall be required to transfer to the Agent any Prohibited Distributions and proceeds of such sale, except to the extent that the Corporation grants written permission to the Purported Transferee to retain a portion of such sales proceeds not exceeding the amount that the Purported Transferee would have received from the Agent pursuant to Section B.(iii) of this Article Fourteen if the Agent rather than the Purported Transferee had resold the Excess Securities. Disposition of Excess Securities by the Agent pursuant to this Section B.(ii) of this Article Fourteen shall be deemed to occur simultaneously with the Prohibited Transfer to which the Excess Securities relate. (iii) The Agent shall apply any proceeds of a sale by it of Excess Securities and, if the Purported Transferee has previously resold the Excess Securities, any amounts received by it from a Purported Transferee, as follows: (x) first, such amounts shall be paid to the Agent to the extent necessary to cover its
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costs and expenses incurred in connection with its duties hereunder; (y) second, any remaining amounts shall be paid to the Purported Transferee, up to the amount paid by the Purported Transferee for the Excess Securities (or the fair market value of the Excess Securities (1) calculated on a given
date,the basis of the closing market price for the Corporation Securities on the New York Stock Exchange, or such other national securities exchange on which the Corporation Securities are then listed or admitted to trading, on the day before the Prohibited Transfer, (2) if the Corporation Securities are not listed or admitted to trading on any national securities exchange but are traded in the over-the-counter market, calculated based upon the difference between the highest bid and lowest asked prices, as such prices are reported by NASDAQ or any successor system on the day before the Prohibited Transfer or, if none, on the last preceding day for which such quotations exist, or (3) if the Corporation Securities are neither listed nor admitted to trading on which a sale occurred prior to such date.
(p) Fiscal Year. The taxable yearany stock exchange nor traded in the over-the-counter market, then as determined in good faith by the Board of the Company which is the
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calendar year.
(q) ISO. An Incentive Stock Option as defined in Section 422 of
---
the Code.
(r) NQSO. A Non-Qualified Stock Option, which is an Option that
----
does not qualify as an ISO.
(s) Option. An option to purchase Shares granted under the Plan.
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(t) Other Stock Based Award. An award under ARTICLE XVIII that
-----------------------
is valued in whole or in part by reference to, or is otherwise based on,
Common Stock.
(u) Parent. Any corporation (other than the Company or a
------
Subsidiary) in an unbroken chain of corporations ending with the Company, if,Directors, at the time of the grant of an Option or other Benefit, each of the
corporations (other than the Company or a Subsidiary) owns stock possessing
50% or more of the total combined voting power of all classes of stock in one
of the other corporations in such chain. The Company's present Parent is
General American Life Insurance Company.
(v) Participant. An individual who is granted a Benefit under
-----------
the Plan. Benefits may be granted only to Employees, employees and owners of
entities which are not Affiliates but which have a direct or indirect
ownership interest in an Employer or in which an Employer has a direct or
indirect ownership interest, individuals who, and employees and owners of
entities which, are customers and suppliers of an Employer, individuals who,
and employees and owners of entities which, render services to an Employer,
and individuals who, and employees and owners of entities which, have
ownership or business affiliations with any individual or entity previously
described.
(w) Performance Share. A Share awarded to a Participant under
-----------------
ARTICLE XVI of the Plan.
(x) Plan. The Reinsurance Group of America, Incorporated
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Flexible Stock Plan and all amendments and supplements to it.
2
(y) Restricted Stock. Shares issued under ARTICLE XV of the
----------------
Plan.
(z) Rule 16b-3. Rule 16b-3 promulgated by the SEC under the
----------
Exchange Act, as amended, or any successor rule in effect from time to time.
(aa) SEC. The Securities and Exchange Commission.
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(bb) Share. A share of Common Stock.
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(cc) SAR. A Stock Appreciation Right, which is the right to
---
receive an amount equalProhibited Transfer to the appreciation, if any, in the Fair Market Value
of a Share from the date of the grant of the right to the date of its payment.
(dd) Subsidiary. Any corporation, other than the Company, in an
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unbroken chain of corporations beginning with the Company if, at the time of
grant of an Option or other Benefit, each of the corporations, other than the
last corporation in the unbroken chain, owns stock possessing 50% or more of
the total combined voting power of all classes of stock in one of the other
corporations in such chain.
2.2 Other Definitions. In addition to the above definitions,
-----------------
certain words and phrases used in the Plan and any Agreement may be defined in
other portions of the Plan or in such Agreement.
2.3 Conflicts in Plan. In the case of any conflict in the terms
-----------------
of the Plan relating to a Benefit, the provisions in the ARTICLE of the PlanPurported Transferee), which specifically grants such Benefit shall control those in a different
ARTICLE.
ARTICLE III
-----------
COMMON STOCK
------------
3.1 Number of Shares. The number of Shares which may be issued
----------------
or sold or for which Options, SARs or Performance Shares may be granted under
the Plan shall initially be 825,000 Shares. Such number of Shares shall
increase annually, effective as of the first day of each Fiscal Year,
commencing with the Fiscal Year beginning in 1994, by the number of Shares
equal to 5% of the number of Shares allocated to this Plan as of the first day
of such Fiscal Year. Such Shares may be authorized but unissued Shares, Shares
held in the treasury, or both.
3.2 Reusage. If an Option or SAR expires or is terminated,
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surrendered, or cancelled without having been fully exercised, if Restricted
Shares or Performance Shares are forfeited, or if any other grant results in
any Shares not being issued, the Shares covered by such Option or SAR, grant
of Restricted Shares, Performance Shares or other grant, as the case may be,
shall again be available for use under the Plan.
3.3 Adjustments. If there is any change in the Common Stock of
-----------
the Company by reason of any stock dividend, spin-off, split-up, spin-out,
recapitalization, merger, consolidation, reorganization, combination or
exchange of shares, the number of SARs and number and class of shares
available for Options and grants of Restricted Stock, Performance Shares and
Other Stock Based Awards and the number of Shares subject to outstanding
Options, SARs, grants of Restricted Stock and Performance Shares which are not
vested, and Other Stock Based Awards, and the price thereof, as applicable,
shall be appropriately adjusted by the Committee.
3
ARTICLE IV
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ELIGIBILITY
-----------
4.1 Determined By Committee. The Participants and the Benefits
-----------------------
they receive under the Planamount (or fair market value) shall be determined solely by the Committee. In
makingBoard of Directors in its determinations, the Committee shall consider past, presentdiscretion; and expected future contributions of Participants and potential Participants(z) third, any remaining amounts, subject to the Employer, including, without limitation,limitations imposed by the performancefollowing proviso, shall be paid to one or more organizations qualifying under Section 501(c)(3) of the Code (or any comparable successor provision) (“Section 501(c)(3)”) selected by the Board of Directors; provided, however, that if the Excess Securities (including any Excess Securities arising from a previous Prohibited Transfer not sold by the Agent in a prior sale or sales), represent a 5% or greater Percentage Stock Ownership in any class of Corporation Securities, then any such remaining amounts to the extent attributable to the disposition of the portion of such Excess Securities exceeding a 5% Percentage Stock Ownership interest in such class shall be paid to two or more organizations qualifying under Section 501(c)(3) selected by the Board of Directors. The recourse of any Purported Transferee in respect of any Prohibited Transfer shall be limited to the amount payable to the Purported Transferee pursuant to clause (y) of the preceding sentence. In no event shall the proceeds of any sale of Excess Securities pursuant to this Section B of this Article Fourteen inure to the benefit of the Corporation. (iv) If the Purported Transferee fails to surrender the Excess Securities or the refraining from the performanceproceeds of services.
ARTICLE V
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ADMINISTRATION
--------------
5.1 Committee. The Plan shall be administered by the Committee.
---------
The Committee shall consist of three or more members of the Board each of whom
is a "Non-Employee Director" as defined in Rule 16b-3 and who is an "outside
director" as defined in Code Section 162(m)(4)(C)(i). The members of the
Committee shall be appointed by and shall serve at the pleasure of the Board,
which may from time to time appoint members in substitution for members
previously appointed and fill vacancies, however caused, in the Committee. The
Committee may select one of its members as its Chairman and shall hold its
meetings at such times and places as it may determine. A majority of its
members shall constitute a quorum. All determinations of the Committee shall
be made by a majority of its members. Any decision or determination reduced to
writing and signed by a majority of the members shall be fully as effective as
if it had been made by a majority vote at a meeting duly called and held.
5.2 Authority. Subjectsale thereof to the terms of the Plan, the Committee
---------
shall have discretionary authority to:
(a) determine the individuals to whom Benefits are granted, the
type and amounts of Benefits to be granted and the time of all such grants;
(b) determine the terms, conditions and provisions of, and
restrictions relating to, each Benefit granted;
(c) interpret and construe the Plan and all Agreements;
(d) prescribe, amend and rescind rules and regulations relating
to the Plan;
(e) determine the content and form of all Agreements;
(f) determine all questions relating to Benefits under the Plan;
(g) maintain accounts, records and ledgers relating to Benefits;
(h) maintain records concerning its decisions and proceedings;
(i) employ agents, attorneys, accountants or other persons for
such purposes as the Committee considers necessary or desirable;
4
(j) take, at anytime, any action permitted by Section 9.1
irrespective of whether any Change of Control has occurred or is imminent; and
(k) do and perform all acts which it may deem necessary or
appropriate for the administration of the Plan and carry out the purposes of
the Plan.
5.3 Delegation. Except as required by Rule 16b-3 with respect to
----------
grants of Options, Stock Appreciation Awards, Performance Shares, Other Stock
Based Awards, or other Benefits to individuals who are subject to Section 16
of the Exchange Act or as otherwise required for compliance with Rule 16b-3,
Code Section 162(m), or other applicable law, the Committee may delegate all
or any part of its authority under the Plan to any Employee, Employees or
committee.
5.4 Adjudication of Claims. The Committee shall have full and
----------------------
complete discretionary authority to make all determinations as to the right to
Benefits under the Plan. In the event that a Participant believes he has not
received the Benefits to which he is entitled under the Plan, a claim shall be
made in writing to the Committee. The claim shall be reviewed by the
Committee. If the claim is approved or denied, in full or in part, the
Committee shall provide a written notice of approval or denialAgent within 9030 days with, in the case of a denial, the specific reasons for the denial and
specific reference to the provisions of the Plan and/or Agreement upon which
the denial is based. A claim shall be deemed denied if the Committee does not
take any action within the aforesaid 90 day period. If a claim is denied or
deemed denied and a review is desired, the Participant shall notify the
Committee in writing within 60 days of the receipt of notice of denial orfrom the date on which the claim is deemed to be denied, as the case may be. In
requesting a review, the Participant may review the Plan or any document
relating to it and submit any written issues and comments he may deem
appropriate. The Committee shall then review the claim and provideCorporation makes a written decisiondemand pursuant to Section B.(ii) of this Article Fourteen, then the Corporation shall use its best efforts to enforce the provisions hereof, including the institution of legal proceedings to compel such surrender. (v) The Corporation shall make the written demand described in Section B.(ii) of this Article Fourteen within 60 days. This decision, if adverse to the Participant, shall
state the specific reasons for the decision and shall include reference to
specific provisions30 days of the Plan and/or Agreementdate on which the decision is
based.Board of Directors determines that the attempted Transfer would result in Excess Securities; provided, however, that if the Corporation makes such demand at a later date, the provisions of Sections A and B of this Article Fourteen shall apply nonetheless. (vi) Anything herein to the contrary notwithstanding, the Agent shall not act or be treated as acting as an agent for or on behalf of the Purported Transferee or for or on behalf of the Corporation and shall have no right to bind any of them, in contract or otherwise, but shall act only to carry out the ministerial functions assigned to it in this Section B of this Article Fourteen. C. Board Authority. The Committee's decision on review shall be final and binding.
ARTICLE VI
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AMENDMENT
---------
6.1 PowerBoard of Board. Except as hereinafter provided, the Board
--------------Directors shall have the sole right and power to amenddetermine all matters necessary for assessing compliance with Sections A and B of this Article Fourteen, including, without limitation, (i) the Plan atidentification of any timeFive-Percent Shareholder, (ii) whether a Transfer is a 5% Transaction, a Prohibited Transfer or a Permitted Transfer, (iii) the Percentage Stock Ownership in the Corporation of anyFive-Percent Shareholder, (iv) whether an instrument constitutes Corporation Securities, (v) the amount (or fair market value) due to a Purported Transferee pursuant to Section B.(iii) of this Article Fourteen, and from
time(vi) any other matters which the Board of Directors determines to time.
6.2 Limitation. The Board may not amendbe relevant; and the Plan, without
----------
approvalgood-faith determination of the shareholdersBoard of Directors on such matters shall be conclusive and binding for all the purposes of Sections A and B of this Article Fourteen. Nothing contained herein shall limit the authority of the Company:
(a)Board of Directors to take such other action, in a manner which would cause Options which are intended to
qualify as ISOs to fail to qualify;
(b) in a manner which would cause the Plan to fail to meet the
requirements of Rule 16b-3 or Code Section 162(m); or
(c) in a manner which would violate applicable law.
5
ARTICLE VII
-----------
TERM AND TERMINATION
--------------------
7.1 Term. The Plan shall commence as of the Effective Date and,
----
subject to the terms of the Plan, including those requiring approval by the
shareholders of the Company and those limiting the period over which ISOs or
any other Benefits may be granted, shall continue in full force and effect
until terminated.
7.2 Termination. The Plan may be terminated at any time by the
-----------
Board.
ARTICLE VIII
------------
MODIFICATION OR TERMINATION OF BENEFITS
---------------------------------------
8.1 General. Subject to the provisions of Section 8.2, the
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amendment or termination of the Plan shall not adversely affect a
Participant's right to any Benefit granted prior to such amendment or
termination.
8.2 Committee's Right. Any Benefit granted may be converted,
-----------------
modified, forfeited or cancelled, in whole or in part, by the Committee if andits discretion, to the extent permitted inby law as it deems necessary or advisable to protect the PlanCorporation, any direct or applicable Agreement or withindirect subsidiary thereof and the consentinterests of the Participant to whom such Benefit was granted.
ARTICLE IX
----------
CHANGE OF CONTROL
-----------------
9.1 Rightholders of Committee. In order to maintain a Participant's
------------------
rightsthe Corporation’s securities in preserving the event of a Change in Control, the Committee, in its sole
discretion, may, in any Agreement evidencing a Benefit, or at any time prior
to, or simultaneously with or after a Change in Control, provide such
protection as it may deem necessary.Tax Benefit. Without in any way, limiting the generality of the foregoing, sentencein the event of a change in law or requiring Treasury Regulations making one or more of the following actions necessary or desirable, the Board of Directors may (i) accelerate the Restriction Release Date, (ii) modify the specific application of the Transfer restrictions set forth in Section A.(ii) of this Article Fourteen, or (iii) modify the definitions of
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any specific protection,terms set forth in this Article Fourteen; provided that (1) the Committee may:
(a) provide for the accelerationBoard of any time periods relating to
the exercise or realization of such Benefit soDirectors shall determine in writing that such Benefit may be
exercisedacceleration, extension, change or realized in full onmodification is reasonably necessary or before a date fixed byadvisable to preserve the Committee;
(b) provide for the purchase of such Benefit, upon the
Participant's request, for an amount of cash equal to the amount which could
have been attained upon the exercise or realization of such Benefit had such
Benefit been currently exercisable or payable;
(c) make such adjustment to the Benefits then outstanding as the
Committee deems appropriate to reflect such transaction or change; and/or
(d) cause the Benefits then outstanding to be assumed, or new
Benefits substituted therefor, by the surviving corporation in such change.
6
ARTICLE X
---------
AGREEMENTS AND CERTAIN BENEFITS
-------------------------------
10.1 Grant Evidenced by Agreement. The grant of any Benefit
----------------------------
under the Plan may be evidenced by an Agreement which shall describe the
specific Benefit granted and the terms and conditions of the Benefit. The
granting of any Benefit shall be subject to, and conditioned upon, the
recipient's execution of any Agreement required by the Committee. Except as
otherwise provided in an Agreement, all capitalized terms used in the
Agreement shall have the same meaning as in the Plan, and the Agreement shall
be subject to all of the terms of the Plan.
10.2 Provisions of Agreement. Each Agreement shall contain such
-----------------------
provisions that the Committee shall determine to be necessary, desirable and
appropriate for the Benefit granted which may include, but not be limited to,
the following with respect to any Benefit: description of the type of Benefit;
the Benefit's duration; its transferability; if an Option, the exercise price,
the exercise period and the person or persons who may exercise the Option; the
effect upon such Benefit of the Participant's death or termination of
employment; the Benefit's conditions; when, if, and how any Benefit may be
forfeited, converted into another Benefit, modified, exchanged for another
Benefit, or replaced; and the restrictions on any Shares purchased or granted
under the Plan.
10.3 Certain Benefits. Except as otherwise expressly provided in
----------------
an Agreement, any Benefit granted to an individual who is subject to Section
16 of the Exchange Act shall be not transferable other than by will or the
laws of descent and distribution and shall be exercisable during his lifetime
only by him, his guardian or his legal representative.
ARTICLE XI
----------
REPLACEMENT AND TANDEM AWARDS
-----------------------------
11.1 Replacement. The Committee may permit a Participant to
-----------
elect to surrender a Benefit in exchange for a new Benefit.
11.2 Tandem Awards. Awards may be granted by the Committee in
-------------
tandem. However, no Benefit may be granted in tandem with an ISO except SARs.
ARTICLE XII
-----------
PAYMENT, DIVIDENDS, DEFERRAL AND WITHHOLDING
--------------------------------------------
12.1 Payment. Upon the exercise of an Option or in the case of
-------
any other Benefit that requires a payment to the Company, the amount due the
Company is to be paid:
(a) in cash;
(b) by the tender to the Company of Shares owned by the optionee
and registered in his name having a Fair Market Value equal to the amount due
to the Company;
7
(c) in other property, rights and credits, including the
Participant's promissory note if permitted under applicable law; or
(d) by any combination of the payment methods specified in (a),
(b) and (c) above.
Notwithstanding, the foregoing, any method of payment other than (a) may be
used only with the consent of the Committee or if and to the extent so
provided in an Agreement. The proceeds of the sale of Common Stock purchased
pursuant to an Option and any payment to the Company for other Benefits shall
be added to the general funds of the Company or to the Shares held in
treasury, as the case may be, and used for the corporate purposes of the
Company as the Board shall determine.
12.2 Dividend Equivalents. Grants of Benefits in Shares or Share
--------------------
equivalents may include dividend equivalent payments or dividend credit
rights.
12.3 Deferral. The right to receive anyTax Benefit under the Plan
--------
may, atCode and the requestregulations thereunder or that the continuation of these restrictions is no longer reasonably necessary for the preservation of the Participant, be deferred forTax Benefit; and (2) no such period and upon
such terms asmodification shall limit or restrict the Committee shall determine, which may include creditingscope of interest on deferrals of cash and crediting of dividends on deferrals
denominated in Shares.
12.4 Withholding. The Company, at the time any distribution is
-----------
made under the Plan, whether in cashclauses (D) or in Shares, may withhold from such
distribution any amount necessary to satisfy federal, state and local income
tax withholding requirements with respect to such distribution. Such
withholding may be in cash or in Shares.
ARTICLE XIII
------------
OPTIONS
-------
13.1 Types of Options. It is intended that both ISOs and NQSOs
----------------
may be granted by the Committee under the Plan.
13.2 Shares for ISOs. The number of Shares for which ISOs may be
---------------
granted on or after the Effective Date shall not exceed 150,000 Shares.
13.3 Grant of ISOs and Option Price. Each ISO must be granted to
------------------------------
an Employee and granted within ten years from the Effective Date. The purchase
price for Shares under any ISO shall be no less than the Fair Market Value(F) of the Shares atdefinition of “Permitted Transfer” in Section A(i)(k) of this Article Fourteen prior to the timeEnd Date (as defined in the OptionRecapitalization and Distribution Agreement).D. Miscellaneous. Any provision in this Article Fourteen which is granted.
13.4 Other Requirements for ISOs. The terms of each Option which
---------------------------
is intendedjudicially determined to qualifybe prohibited, invalid or otherwise unenforceable (whether on its face or as an ISO shall meet all requirements of Section 422 of
the Code.
13.5 NQSOs. The terms of each NQSO shall provide that such Option
-----
will not be treated as an ISO. The purchase price for Shares under any NQSO
shall be equal to or greater than the Fair Market Value of the Shares at the
time the Option is granted.
13.6 Determination by Committee. Except as otherwise provided in
--------------------------
Section 13.2 through Section 13.5, the terms of all Options shall be
determined by the Committee.
8
13.7 Limitation on Shares Covered by Options. The maximum number
---------------------------------------
of Shares with respect to which such Options may be granted to any Participant
in any 1 year period shall not exceed 200,000 shares. For purposes of the
preceding sentence, the Shares covered by an Option that is cancelled shall
count against the maximum number of Shares, and, if the exercise price under
an Option is reduced, the transaction shall be treated as a cancellation of
the Option and a grant of a new Option.
ARTICLE XIV
-----------
SARS
----
14.1 Grant and Payment. The Committee may grant SARs. Upon
-----------------
electing to receive payment of a SAR, a Participant shall receive payment in
cash, in Common Stock, or in any combination of cash and Common Stock, as the
Committee shall determine.
14.2 Grant of Tandem Award. The Committee may grant SARs in
---------------------
tandem with an Option, in which case: the exercise of the Option shall cause a
correlative reduction in SARs standingapplied to a Participant's credit which were
granted in tandem with the Option; and the payment of SARs shall cause a
correlative reduction of the Sharesparticular shareholder, transferee or Transfer) under such Option.
14.3 ISO Tandem Award. When SARs are granted in tandem with an
----------------
ISO, the SARs shall have such terms and conditions as shall be required for
the ISO to qualify as an ISO.
14.4 Payment of Award. SARs shall be paid, to the extent payment
----------------
is elected by the Participant (and is otherwise due and payable), as soon as
practicable after the date on which such election is made.
14.5 Limitation on SARs. The maximum number of SARs which may be
------------------
granted to any Participant in any 1 year period shall not exceed 15,000 SARs.
For purposes of the preceding sentence, any SARs that are cancelled shall
count against the maximum number of SARs, and, if the Fair Market Value of a
Share on which the appreciation under a SAR will be calculated is reduced, the
transaction shall be treated as a cancellation of the SAR and a grant of a new
SAR.
ARTICLE XV
----------
RESTRICTED STOCK
----------------
15.1 Description. The Committee may grant Benefits in Shares
-----------
available under ARTICLE III of the Plan as Restricted Stock. Shares of
Restricted Stock shall be issued and delivered at the time of the grant but
shall be subject to forfeiture until provided otherwise in the applicable
Agreement or the Plan. Each certificate representing Shares of Restricted
Stock shall bear a legend referring to the Plan and the risk of forfeiture of
the Shares and stating that such Shares are nontransferable until all
restrictions have been satisfied and the legend has been removed. The grantee
shall be entitled to full voting and dividend rights with respect to all
shares of Restricted Stock from the date of grant.
15.2 Cost of Restricted Stock. Grants of Shares of Restricted
------------------------
Stock shall be made at a per Share cost to the Participant equal to par value.
9
15.3 Non-Transferability. Shares of Restricted Stock shall not
-------------------
be transferable until after the removal of the legend with respect to such
Shares.
ARTICLE XVI
-----------
PERFORMANCE SHARES
------------------
16.1 Description. Performance Shares are the right of an
-----------
individual to whom a grant of such Shares is made to receive Shares or cash
equal to the Fair Market Value of such Shares at a future date in accordance
with the terms of such grant. Generally, such right shall be based upon the
attainment of targeted profit and/or performance objectives.
16.2 Grant. The Committee may grant an award of Performance
-----
Shares. The number of Performance Shares and the terms and conditions of the
grant shall be set forth in the applicable Agreement.
ARTICLE XVII
------------
CASH AWARDS
-----------
17.1 Grant. The Committee may grant Cash Awards at such times
-----
and (subject to Section 17.2) in such amounts as it deems appropriate.
17.2 Limitation on Amount. The Amount of any Cash Award in any
--------------------
Fiscal Year to any Participant who is subject to Section 16 of the Exchange
Act shall not exceed the greater of $100,000 or 50% of his cash compensation
(excluding any Cash Award under this ARTICLE XVII) for such Fiscal Year.
17.3 Restrictions. Cash Awards may be subject or not subject to
------------
conditions (such as an investment requirement), restricted or nonrestricted,
vested or subject to forfeiture and may be payable currently or in the future
or both.
ARTICLE XVIII
-------------
OTHER STOCK BASED AWARDS AND OTHER BENEFITS
-------------------------------------------
18.1 Other Stock Based Awards. The Committee shall have the
------------------------
right to grant Other Stock Based Awards which may include, without limitation,
the grant of Shares based on certain conditions, the payment of cash based on
the performance of the Common Stock, and the grant of securities convertible
into Shares.
18.2 Other Benefits. The Committee shall have the right to
--------------
provide types of Benefits under the Plan in addition to those specifically
listed, if the Committee believes that such Benefits would further the
purposes for which the Plan was established.
ARTICLE XIX
-----------
MISCELLANEOUS PROVISIONS
------------------------
19.1 Underscored References. The underscored references
----------------------
contained in the Plan are included only for convenience, and they shall not be
construed as a part of the Plan or in any respect affecting or modifying its
provisions.
10
19.2 Number and Gender. The masculine and neuter, wherever used
-----------------
in the Plan, shall refer to either the masculine, neuter or feminine; and,
unless the context otherwise requires, the singular shall include the plural
and the plural the singular.
19.3 Governing Law. This Plan shall be construed and
-------------
administered in accordance with the laws of the State of Missouri.
19.4 Purchase for Investment. The Committee may require each
-----------------------
person purchasing Shares pursuant to an Option or other award under the Plan
to represent to and agree with the Company in writing that such person is
acquiring the Shares for investment and without a view to distribution or
resale. The certificates for such Shares may include any legend which the
Committee deems appropriate to reflect any restrictions on transfer. All
certificates for Shares delivered under the PlanMissouri shall be subjectineffective to the extent of such stock-transfer ordersprohibition, invalidity or unenforceability without prohibiting, invalidating or rendering unenforceable the remaining provisions of this Article Fourteen and other restrictionsof these Amended and Restated Articles of Incorporation, which shall be thereafter interpreted as if the Committee may deem
advisable under all applicable laws, rulesprohibited, invalid or unenforceable part were not contained herein, and, regulations, andto the Committee
may causemaximum extent possible, in a legend or legends to be put on any such certificates to make
appropriate references to such restrictions.
19.5 No Employment Contract. The adoptionmanner consistent with preserving the Corporation’s use of the Plan shall not
----------------------
confer uponTax Benefits without any Employee any right to continued employment nor shall it
interfere in any way with the right of the Employer to terminate the
employment of any of its Employees at any time.
19.6 No Effect on Other Benefits. The receipt of Benefits under
---------------------------
the Plan shall have no effect on any benefits to which a Participant may be
entitled from the Employer, under another plan or otherwise, or preclude a
Participant from receiving any such benefits.
11
Section 382 limitation.
A-18
PRELIMINARY COPY PROXY
REINSURANCE GROUP OF AMERICA, INCORPORATED
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
Class A Common Stock This Proxy is Solicited on Behalf of the Board of Directors The undersigned does hereby appoint Jack B. Lay, James E. Sherman and William L. Hutton, or any of them, each with power of substitution, as the true and lawful attorneys-in-fact, agents and proxies of the undersigned to represent and vote all shares of Class A Common Stock standing on the books of Reinsurance Group of America, Incorporated (“RGA”) in the name of the undersigned at the AnnualSpecial Meeting of the StockholdersShareholders of REINSURANCE GROUP OF AMERICA,
INCORPORATEDRGA, to be held May 23, 2007, commencing at 2:00 p.m., St. Louis time,
at the Company's officesRGA’s corporate headquarters at 1370 Timberlake Manor Parkway, Chesterfield, Missouri 63017 on November 25, 2008 at 11:00 a.m., local time, and at any and all adjournments andor postponements of said
meeting,thereof (the “Special Meeting”) and to vote all the shares of Class A Common Stock of the Company standing on the books of the Company in the name of the undersigned as specified and in their discretion on such other business as may properly come before the meeting. PLEASE COMPLETE, SIGN AND DATE OTHER SIDE AND RETURN PROMPTLY.
------------------------------------------------------------------------
ADDRESS CHANGE/COMMENTS (MARK The undersigned hereby revokes any proxy previously given and acknowledges receipt of the Notice of Special Meeting and Proxy Statement dated October [], 2008. THE CORRESPONDING BOXSHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED BY THE UNDERSIGNED WITH RESPECT TO ALL MATTERS SET FORTH ON THE REVERSE SIDE)
------------------------------------------------------------------------
------------------------------------------------------------------------
- ------------------------------------------------------------------------------
SIDE AND, WITH RESPECT TO ALL OTHER MATTERS PROPERLY COMING BEFORE THE SPECIAL MEETING, WILL BE VOTED IN THE DISCRETION OF THE PROXY HOLDERS NAMED ABOVE. IF NO DIRECTION IS MADE, THE PROXIES WILL BE VOTED “FOR” THE PROPOSALS LISTED ON THE REVERSE SIDE. Please complete, sign and date other side and return promptly. | | | | Address Change/Comments(Mark the corresponding box on the reverse side) | | |
| | |
| | |
| | |
| | |
| | |
FOLD AND DETACH HERE
April 11, 2007
October [___], 2008 Dear Shareholder: We invite you to attend the 2007 AnnualSpecial Meeting of Stockholdersthe Shareholders of Reinsurance Group of America, Incorporated, to be held on May 23, 2007November 25, 2008 at the Company'sCompany’s offices at 1370 Timberlake Manor Parkway, Chesterfield, Missouri 63017 at 2:11:00 p.m.a.m., local time. It is important that your shares are represented at the meeting.Special Meeting. Whether or not you plan to attend the meeting,Special Meeting, please review the enclosed proxy materials, complete the proxy form above,on the reverse side, detach it, and return it promptly in the envelope provided.
Please
Mark Here / /
for Address
Change or
Comments
SEE REVERSE SIDE
MANAGEMENT RECOMMENDS A VOTE FOR THE FOLLOWING:
ELECTION OF DIRECTORS
1. To elect three directors for terms expiring in 2010;
01 William J. Bartlett
02 Alan C. Henderson
03 A. Greig Woodring
FOR all nominees WITHHOLD AUTHORITY
listed (except as marked to vote for all
to the contrary) nominees listed
/ / / /
2. To approve an amendment to the Company's FOR AGAINST ABSTAIN
Flexible Stock Plan; [ ] [ ] [ ]
3. To authorize the sale of certain types of FOR AGAINST ABSTAIN
of securities from time to time to MetLife, [ ] [ ] [ ]
Inc.
| | | | | This proxy will be voted as specified. If no specification is made, this proxy will be voted FOR Proposals 1, 2 and 3. | | Mark Here
for Address
Change or
Comments | c | | | PLEASE SEE REVERSE SIDE | | The RGA Board of Directors recommends a vote “FOR” Proposals 1, 2 and 3. | | PLEASE MARK
YOUR
CHOICE LIKE THIS
IN BLUE OR BLACK
INK. | x |
| | | | | | | | | | | | | FOR | | AGAINST | | ABSTAIN | | | | | | | | | | | 1. | | To approve the conversion of the RGA class B common stock into RGA class A common stock on a one-for-one basis. | | c | | c | | c | | | | | | | | | | | | | | FOR | | AGAINST | | ABSTAIN | | | | | | | | | | | 2. | | To approve the amendment and restatement of RGA’s Amended and Restated Articles of Incorporation. | | c | | c | | c | | | | | | | | | | | | | | FOR | | AGAINST | | ABSTAIN | | | | | | | | | | | 3. | | To adjourn the Special Meeting if necessary or appropriate to permit further solicitation of proxies if there are not sufficient votes at the time of the Special Meeting to approve Proposals 1 or 2. | | c | | c | | c |
Dated:, the beneficial owner of a majority of
the Company's common shares, or affiliates
of MetLife, Inc.;
(INSTRUCTION: to withhold authority to vote for any individual nominee,
strike a line through the nominee's name on the list above.)
The undersigned hereby acknowledges receipt of the Notice of the
2007 Annual Meeting of Stockholders and the accompanying Proxy
Statement.
This proxy will be voted as specified. If no specification is made, this
proxy will be voted FOR Items 1, 2 and 3.
Dated:__________________________________________________________, 2007
______________________________________________________________________
2008 Signature
______________________________________________________________________
Signature if held jointly Please sign as name appears hereon. If Stock isShares are owned in joint names, both owners must sign. If address at
left is incorrect,When signing as attorney, executor, administrator, trustee or guardian, please write in the correct information.
PLEASE SIGN AS REGISTERED AND RETURN PROMPTLY TO:
REINSURANCE GROUP OF AMERICA, INCORPORATED, MIDTOWN STATION,give full title. Please sign as registered and return promptly to:
Reinsurance Group of America, Incorporated, Midtown Station, PO BOXBox 870, NEW YORK,New York, NY 10138
- ------------------------------------------------------------------------------
5FOLD AND DETACH HERE5 WE ENCOURAGE YOU TO TAKE ADVANTAGE OF INTERNET OR TELEPHONE VOTING,
BOTH ARE AVAILABLE 24 HOURS A DAY, 7 DAYS A WEEK.
INTERNET AND TELEPHONE VOTING IS AVAILABLE THROUGH Internet and telephone voting is available through 11:59 PM EASTERN TIME
THE DAY PRIOR TO ANNUAL MEETING DAY.
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.
Eastern Time
the day prior to special meeting day. 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.
- --------------------------------------- -----------------------------------------
| | | | | | | | | | | | | | | | | | | INTERNET TELEPHONE
http://www.proxyvoting.com/rga | | | | | | TELEPHONE
1-866-540-5760 | | | | | | OR | | | | | | Use the internetInternet to vote your proxy. Have; your proxy card in hand when you access the web site. | | | | | Use any touch-tone telephone to vote your proxy. Have your proxy card in hand when OR vote your proxy. Have your proxy
you access the web site. card in hand when you call.
- --------------------------------------- -----------------------------------------
| | | | | | | | | | |
If you vote your proxy by Internet or by telephone, you do NOT need to mail back your proxy card.
To vote by mail, mark, sign and date your proxy card and return it in the enclosed postage-paid envelope. Important Notice regarding the availability of Proxy Material for the
Shareholders Meeting to be held November 25, 2008. The proxy
statement may be viewed online at www.rgare.com
PRELIMINARY COPY PROXY
REINSURANCE GROUP OF AMERICA, INCORPORATED Class B Common Stock This Proxy is Solicited on Behalf of the Board of Directors The undersigned does hereby appoint Jack B. Lay, James E. Sherman and William L. Hutton, or any of them, each with power of substitution, as the true and lawful attorneys-in-fact, agents and proxies of the undersigned to represent and vote all shares of Class A Common Stock standing on the books of Reinsurance Group of America, Incorporated (“RGA”) in the name of the undersigned at the Special Meeting of Shareholders of RGA, to be held at RGA’s corporate headquarters at 1370 Timberlake Manor Parkway, Chesterfield, Missouri 63017 on November 25, 2008 at 11:00 a.m., local time, and at any adjournments or postponements thereof (the “Special Meeting”) and to vote all the shares of Class B Common Stock standing on the books of the Company in the name of the undersigned as specified and in their discretion on such other business as may properly come before the meeting. The undersigned hereby revokes any proxy previously given and acknowledges receipt of the Notice of Special Meeting and Proxy Statement dated October [], 2008. THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED BY THE UNDERSIGNED WITH RESPECT TO ALL MATTERS SET FORTH ON THE REVERSE SIDE AND, WITH RESPECT TO ALL OTHER MATTERS PROPERLY COMING BEFORE THE SPECIAL MEETING, WILL BE VOTED IN THE DISCRETION OF THE PROXY HOLDERS NAMED ABOVE. IF NO DIRECTION IS MADE, THE PROXIES WILL BE VOTED “FOR” THE PROPOSALS LISTED ON THE REVERSE SIDE. Please complete, sign and date other side and return promptly. | | | | Address Change/Comments(Mark the corresponding box on the reverse side) | | |
| | |
| | |
| | |
| | |
| | |
FOLD AND DETACH HERE October [___], 2008 Dear Shareholder: We invite you to attend the Special Meeting of the Shareholders of Reinsurance Group of America, Incorporated, to be held on November 25, 2008 at the Company’s offices at 1370 Timberlake Manor Parkway, Chesterfield, Missouri 63017 at 11:00 a.m., local time. It is important that your shares are represented at the Special Meeting. Whether or not you plan to attend the Special Meeting, please review the enclosed proxy materials, complete the proxy form on the reverse side, detach it, and return it promptly in the envelope provided.
| | | | | This proxy will be voted as specified. If no specification is made, this proxy will be voted FOR Proposals 1, 2 and 3. | | Mark Here
for Address
Change or
Comments | c | | | PLEASE SEE REVERSE SIDE | The RGA Board of Directors recommends a vote “FOR” Proposals 1, 2 and 3. | | PLEASE MARK
YOUR
CHOICE LIKE THIS
IN BLUE OR BLACK
INK. | | x |
| | | | | | | | | | | | | FOR | | AGAINST | | ABSTAIN | | | | | | | | | | | 1. | | To approve the conversion of the RGA class B common stock into RGA class A common stock on a one-for-one basis. | | c | | c | | c | | | | | | | | | | | | | | FOR | | AGAINST | | ABSTAIN | | | | | | | | | | | 2. | | To approve the amendment and restatement of RGA’s Amended and Restated Articles of Incorporation. | | c | | c | | c | | | | | | | | | | | | | | FOR | | AGAINST | | ABSTAIN | | | | | | | | | | | 3. | | To adjourn the Special Meeting if necessary or appropriate to permit further solicitation of proxies if there are not sufficient votes at the time of the Special Meeting to approve Proposals 1 or 2. | | c | | c | | c |
Dated:, 2008 Signature Signature if held jointly Please sign as name appears hereon. If Shares are owned in joint names, both owners must sign. When signing as attorney, executor, administrator, trustee or guardian, please give full title. Please sign as registered and return promptly to:
Reinsurance Group of America, Incorporated, Midtown Station, PO Box 870, New York, NY 10138 5FOLD AND DETACH HERE5 WE ENCOURAGE YOU TO TAKE ADVANTAGE OF INTERNET OR TELEPHONE VOTING,
BOTH ARE AVAILABLE 24 HOURS A DAY, 7 DAYS A WEEK. Internet and telephone voting is available through 11:59 PM Eastern Time
the day prior to special meeting day. 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. | | | | | | | | | | | | | | | | | | | INTERNET
http://www.proxyvoting.com/rga | | | | | | TELEPHONE
1-866-540-5760 | | | | | | OR | | | | | | Use the Internet to vote your proxy. Have; your proxy card in hand when you access the web site.
| | | | | Use any touch-tone telephone to vote your proxy. Have your proxy card in hand when you call.
| | | | | | | | | | |
If you vote your proxy by Internet or by telephone, you do NOT need to mail back your proxy card.
To vote by mail, mark, sign and date your proxy card and return it in the enclosed postage-paid envelope. Important Notice regarding the availability of Proxy Material for the
Shareholders Meeting to be held November 25, 2008. The proxy
statement may be viewed online at www.rgare.com |
