Ally Bank 2012 Annual Report Download - page 161

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The changes to the terms of the Existing Series A Preferred Stock pursuant to the terms of the Amendment were deemed substantive, and
as a result, the transaction was accounted for as a redemption of the Existing Series A Preferred Stock and the issuance of the Amended
Series A Preferred Stock. The Existing Series A Preferred Stock was removed at its carrying value, the Amended Series A Preferred Stock was
recognized at its fair value, and the difference of $32 million was recorded as an increase to retained earnings, which impacted the income
available to common stockholders used for the earnings per common share calculation.
Series G Preferred Stock
Effective June 30, 2009, we converted (the Conversion) from a Delaware limited liability company into a Delaware corporation in
accordance with applicable law. In connection with the Conversion, the 7% Cumulative Perpetual Preferred Stock (the Blocker Preferred) of
Preferred Blocker Inc. (PBI), a wholly owned subsidiary, was required to be converted into or exchanged for preferred stock. For this purpose,
we had previously authorized for issuance its 7% Fixed Rate Cumulative Perpetual Preferred Stock, Series G (the Series G Preferred Stock).
Pursuant to the terms of a Certificate of Merger, effective October 15, 2009, PBI merged with and into Ally with Ally continuing as the
surviving entity. At that time, each share of the Blocker Preferred issued and outstanding immediately prior to the effective time of the merger
was converted into the right to receive an equal number of newly issued shares of Series G Preferred Stock. In the aggregate, 2,576,601 shares
of Series G Preferred Stock were issued to holders of the Blocker Preferred in connection with the merger. The Series G Preferred Stock ranks
equally in right of payment with each of our outstanding series of preferred stock in accordance with the terms thereof.
The Series G Preferred Stock accrues dividends at a rate of 7% per annum. Dividends are payable quarterly, in arrears, only if and when
declared by Ally's Board of Directors. Subject to any other restrictions contained in the terms of any other series of stock or other agreements
that Ally is or may become subject to, at Ally's option and subject to Ally having obtained any required regulatory approvals, Ally may,
subject to certain conditions, redeem the Series G Preferred Stock, in whole or in part, at any time or from time to time, upon proper notice
given, at a redemption price equal to the liquidation amount plus the amount of any accrued and unpaid dividends thereon through the date of
redemption. The Series G Preferred Stock generally is nonvoting other than class-voting on certain matters under certain circumstances
including generally, the authorization of senior capital stock or amendments that adversely impact the Series G Preferred Stock. Ally is
generally prohibited from making any Restricted Payments on or prior to January 1, 2014, and may only make Restricted Payments after
January 1, 2014, if certain conditions are satisfied. For this purpose, Restricted Payments include, subject to certain exceptions, any dividend
payment or distribution of assets on any common stock or any redemption, purchase, or other acquisition of any shares of common stock.
Table of Contents
Notes to Consolidated Financial Statements
Ally Financial Inc. • Form 10-K