First Data 2007 Annual Report Download - page 213

Chase Paymentech
NOTES TO COMBINED FINANCIAL STATEMENTS – CONTINUED
For the years ended December 31, 2007 and 2006 and
the year ended December 31, 2005 (unaudited)
2005
Related Party Nature of Relationship
Revenue
(expense), net
JPMorgan Chase Banking and investment management services $ 19,804
Customer referral program (1,543)
Transaction and related services, net (476)
Rent (1,667)
FDC Transaction servicing and related services (99,843)
Point-of-sale equipment and supplies (22,714)
Debit interchange (12,294)
Data transmission, authorization and portfolio management services 9,898
NOTE 18 – OWNERS' EQUITY
As discussed in Note 1, the Company includes a combination of corporations, LLCs and a general partnership. Information regarding the capital structure of
these entities is shown below.
Corporations
FDC Offer Corp.
FDC Offer Corp.'s authorized and outstanding common stock as of December 31, 2007 and 2006 consisted of 1,000 shares of common stock (FDC Offer
Corp. Common Stock), par value $0.01 per share. All FDC Offer Corp. Common Stock outstanding is owned by JPMorgan Chase and FDC. The shares of
FDC Offer Corp. are restricted from transfer, without the consent of the other shareholder.
Paymentech, Inc.
Paymentech, Inc.'s authorized capital stock consists of a total of 70,000,000 shares, as follows: 60,000,000 shares of Class A Common Stock, par value $0.01
per share, and 10,000,000 Shares of Class B Common Stock, par value $0.01 per share.
As of December 31, 2007 and 2006 there were 36,451,566 shares of Class A Common Stock outstanding. FDC Offer Corp holds all issued and outstanding
Class A Common Stock. Holders of shares of Class A Common Stock are entitled to one vote per share on all matters submitted to a vote of stockholders.
There is no right to cumulative voting for the election of directors. Holders of shares of Class A Common Stock are entitled to receive dividends, paid in
accordance with the instructions of the board of directors out of funds legally available therefore. In the event of liquidation, holders of shares of Class A
Common Stock are entitled to share ratably in all assets remaining after payment of liabilities. Holders of shares of Class A Common Stock have no
conversion, redemption or preemptive rights. The rights of the holders of Class B Common Stock will, in some instances, restrict the rights of the holders of
Class A Common Stock.
As of December 31, 2007 and 2006 there were 60,615 and 113,966 Shares of Class B Common Stock outstanding, respectively. Unless otherwise noted, the
holders of Shares of Class B Common Stock have the same rights as holders of shares of Class A Common Stock. Holders of shares of Class B Common
Stock are entitled to one-tenth of one vote per share on all matters submitted to a vote of stockholders, and are entitled to receive dividends, paid in
accordance with the instructions of the board of directors out of funds legally available therefore. Dividends so declared must be paid equally with respect to
shares of Class A Common Stock and shares of Class B Common Stock. Likewise, in the event of liquidation, holders of Shares of Class B Common Stock
are entitled to share ratably with holders of Class A Common Stock in all assets remaining after payment of liabilities. Holders of Class A Common Stock are
prohibited from using their superior voting power to impair the rights of holders of Class B Common Stock.
As discussed in Note 15, the Class B Common Stock (or Class B Shares) is subject to certain redemption features. Additionally, should the Company
undertake a public offering pursuant to an effective registration statement under the Securities Act of 1933, as amended, each outstanding share of Class B
Common Stock would be automatically converted into one share of Class A Common Stock upon the date of the closing of the sale.
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