Family Dollar 2013 Annual Report Download - page 69

14. Shareholders’ Equity:
Stock Repurchases
During fiscal 2013, the Company purchased a total of 1.2 million shares of its common stock at a cost of
$75.0 million, all of which were purchased on the open market.
During fiscal 2012, the Company purchased a total of 3.2 million shares of its common stock at a cost of
$191.6 million, all of which were purchased on the open market.
During fiscal 2011, the Company purchased a total of 13.9 million shares of its common stock at a cost of
$670.5 million, of which 8.6 million shares were purchased on the open market at a cost of $420.5 million. On
October 5, 2010, the Company entered into an accelerated share repurchase agreement with a large financial
institution. In connection with the agreement, the Company made a prepayment of $250.0 million to the financial
institution and immediately received 4.4 million shares (80% of the prepayment amount). The financial
institution purchased shares of the Company’s common stock in the open market over an averaging period in
order to cover its position with respect to shares it borrowed for the initial delivery and for any shares payable
upon settlement. Upon settlement, another 0.9 million shares were delivered to the Company.
All shares are purchased pursuant to share repurchase authorizations approved by the Board of Directors. On
January 17, 2013, the Company announced that the Board of Directors authorized the Company to purchase up to
an additional $300 million of the Company’s outstanding common stock. On September 28, 2011, the Company
announced that the Board of Directors authorized the Company to purchase up to $250 million of the Company’s
outstanding common stock. As of August 31, 2013, the Company had $370.8 million remaining under current
share repurchase authorizations.
There is no expiration date related to the above referenced remaining authorizations. Shares purchased under the
share repurchase authorizations are generally held in treasury or are cancelled and returned to the status of
authorized but unissued shares.
Retirement of Treasury Shares
During fiscal 2012, the Company retired 29.4 million shares of its common stock held in treasury. The shares
were returned to the status of authorized but unissued shares. As a result, the treasury stock balance decreased by
approximately $1.2 billion. As a part of the retirement, the Company reduced its Common Stock, Capital in
Excess of Par, and Retained Earnings balances by approximately $2.9 million, $60.1 million and $1.1 billion,
respectively. Refer to Note 1 for the Company’s accounting policy for retirements of treasury shares.
Stockholders’ Rights Plan
On March 2, 2011, the Company adopted a stockholders’ rights plan whereby the Board of Directors of the
Company authorized and declared a dividend distribution of one right for each outstanding share of common
stock of the Company to stockholders of record at the close of business on March 2, 2011. On February 24, 2012,
the Board of Directors approved, and the Company entered into, an amendment to the stockholders’ rights plan to
extend the expiration date of the rights to March 2, 2013. On November 16, 2012, the Board of Directors
approved, and the Company entered into, an amendment to the stockholders’ rights plan to accelerate the
expiration date of the rights to November 16, 2012, thereby terminating the stockholder’s rights plan.
Dividends
During fiscal 2013, the Company paid cash dividends of $0.94 per share for a total of $108.3 million. During
fiscal 2012, the Company paid cash dividends of $0.78 per share for a total of $91.4 million. During fiscal 2011,
the Company paid cash dividends of $0.67 per share for a total of $83.4 million.
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