$310.0 million. As a result of this transaction, during the fourth quarter of 2003, the Company's U.S. traditional sub-segment reflected $246.1 million in net premiums and approximately $6.8 million of net income, after tax.
A portion of the growth of premiums for the segment in each year presented is due to reinsurance of critical illness, as a stand alone benefit or as an accelerated benefit on a life insurance policy. This coverage provides a benefit in the event of a death from or the diagnosis of a defined critical illness. Reinsurance of critical illness in the Asia Pacific operations is offered primarily in Australia and Korea. Premiums earned from this coverage totaled $60.1 million, $39.1 million and $31.2 million in 2005, 2004 and 2003, respectively.
During the fourth quarter of 2003, the Company issued 12,075,000 shares of its common stock at $36.65 per share, raising proceeds of approximately $426.7 million, net of expenses. The Company has used the proceeds for general corporate purposes, including funding its reinsurance operations. MetLife, Inc. and its affiliates purchased 3,000,000 shares of common stock in the offering with a total purchase price of approximately $110.0 million.
Historically, RGA has paid quarterly dividends ranging from $0.027 per share in 1993 to $0.09 per share in 2005. All future payments of dividends are at the discretion of the Company's Board of Directors and will depend on the Company's earnings, capital requirements, insurance regulatory conditions, operating conditions, and such other factors as the Board of Directors may deem relevant. The amount of dividends that the Company can pay will depend in part on the operations of its reinsurance subsidiaries.
See Note 9 - "Income Tax" and Note 10 - "Employee Benefit Plans" in Notes to Consolidated Financial Statements for information related to the Company's obligations for taxes and funding requirements for retirement and other post-employment benefits.
The Company had total cash and invested assets of $12.5 billion and $10.7 billion at December 31, 2005 and 2004, respectively. All investments held by RGA and its subsidiaries are monitored for conformance to the qualitative and quantitative limits prescribed by the applicable jurisdiction's insurance laws and regulations. In addition, the operating companies' Boards of Directors periodically review their respective investment portfolios. The Company's investment strategy is to maintain a predominantly investment-grade, fixed maturity portfolio, to provide adequate liquidity for expected reinsurance obligations, and to maximize total return through prudent asset management. The Company's asset/liability duration matching differs between operating segments. Based on Canadian reserve requirements, a portion of the Canadian liabilities is strictly matched with long-duration Canadian assets, with the remaining assets invested to maximize the total rate of return, given the characteristics of the corresponding liabilities and Company liquidity needs. The duration of the Canadian portfolio exceeds twenty years. The target duration for other operating segments portfolios, which are segmented along product lines, range between four and seven years. The Company's earned yield on invested assets was 5.89% in 2005, compared with 5.91% in 2004, and 6.39% in 2003. See Note 5 - "Investments" in the Notes to Consolidated Financial Statements for additional information regarding the Company's investments.
Substantially all of the Company's funds withheld at interest receivable balance is associated with its reinsurance of annuity contracts. The funds withheld receivable balance totaled $3.5 billion and $2.7 billion at December 31, 2005 and 2004, respectively, of which $2.5 billion and $1.9 billion, respectively, were subject to the provisions of Issue B36 (see Note 2 - "New Accounting Pronouncements" in Notes to Consolidated Financial Statements for further discussion).
The Company's U.S. tax returns have been audited by the relevant taxing authorities for all years through 2001. The Company believes established tax contingency reserves are adequate in relation to the potential for additional assessments. Once established, reserves are adjusted as information becomes available or when an event requiring a change to the reserve occurs. The resolution of tax matters could have an effect on the Company's effective rate.
Assumed health care cost trend rates may have a significant effect on the amounts reported for health care plans. A one-percentage point change in assumed health care cost trend rates would have the following effects (in thousands):
The Company leases office space and furniture and equipment under non-cancelable operating lease agreements, which expire at various dates. Future minimum office space annual rentals under non-cancelable operating leases at December 31, 2005 are as follows:
Certain of the Company's debt agreements contain financial covenant restrictions related to, among others, liens, the issuance and disposition of stock of restricted subsidiaries, minimum requirements of consolidated net worth, maximum ratios of debt to capitalization, change of control provisions, and minimum rating requirements. A material ongoing covenant default could
The Company adopted the RGA Flexible Stock Plan (the "Plan") in February 1993 and the Flexible Stock Plan for Directors (the "Directors Plan") in January 1997 (collectively, the "Stock Plans"). The Stock Plans provide for the award of benefits (collectively "Benefits") of various types, including stock options, stock appreciation rights ("SARs"), restricted stock,