IHOP 2011 Annual Report Download - page 105

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DineEquity, Inc. and Subsidiaries
Notes to the Consolidated Financial Statements (Continued)
15. Preferred Stock and Stockholders' Equity (Continued)
87
holders thereof to receive certain dividends and distributions to the extent that any dividends or distributions paid on the Company's
common stock exceed the annual accretion on the Series B Convertible Preferred Stock. Holders of Series B Convertible Preferred
Stock are entitled to vote on all matters (including the election of directors) submitted to the holders of the Company's common
stock, as a single class with the holders of the Company's common stock, with each share of Series B Convertible Preferred Stock
having one vote per share of the Company's common stock then issuable upon conversion of such share of Series B Convertible
Preferred Stock. As of December 31, 2011 and 2010, the aggregate accretion for the Series B Convertible Preferred Stock was
$9.6 million and $7.1 million, respectively.
At any time and from time to time, any holder of Series B Convertible Preferred Stock may convert all or any portion of the
Series B Convertible Stock held by such holder into a number of shares of the Company's common stock computed by multiplying
(i) each $1,000 of aggregate accreted value of the shares to be converted by (ii) the conversion rate then in effect (which initially
is 14.44878 shares of common stock per $1,000 of accreted value, but subject to customary anti-dilution adjustments). All
outstanding shares of Series B Convertible Preferred Stock will automatically convert into shares of the Company's common stock
on the fifth anniversary of the issue date, at the conversion rate then in effect, without any action on the part of the holder thereof.
The Company also entered into a registration rights agreement, dated as of November 29, 2007, with Chilton pursuant to
which the Company granted Chilton certain registration rights with respect to the shares of Series B Convertible Preferred Stock
issued to Chilton and the shares of common stock issuable upon conversion.
Share Repurchase Program
In August 2011, the Board of Directors approved the repurchase of up to $45 million of the Company's common stock.
Under the program, the Company may repurchase shares on an opportunistic basis from time to time in open market transactions
and in privately negotiated transactions based on business, market, applicable legal requirements, and other considerations. The
repurchase program does not require the repurchase of a specific number of shares and may be terminated at any time. As of
December 31, 2011, the Company has repurchased 534,101 shares of stock for $21.2 million, an average price of $39.64 per share,
under the currently authorized repurchase program.
Dividends
There were no dividends declared or paid on common shares in 2011, 2010 or 2009. Under current debt agreements, the
Company is restricted from paying dividends on common stock until certain financial ratios are achieved. Those ratios have not
been achieved as of December 31, 2011. At such time as those financial ratios are achieved, dividend payments on common stock
may be resumed at the discretion of the Board of Directors after consideration of the Company's earnings, financial condition,
cash requirements, future prospects and other factors.
16. Other Comprehensive Income (Loss)
The components of comprehensive income (loss), net of taxes, are as follows:
Net income (loss)
Other comprehensive income (net of tax):
Interest rate swap
Temporary decline in available-for-sale securities
Total comprehensive income
Year Ended December 31,
2011
(in millions)
$ 75.2
—
—
$ 75.2
2010
$(2.8)
20.5
—
$ 17.7
2009
$ 31.4
8.5
0.1
$ 40.0
The amount of income tax benefit allocated to the interest rate swap was $9.5 million and $5.4 million for the years ended
December 31, 2010 and 2009, respectively.
The accumulated comprehensive loss as of December 31, 2011 and 2010 is comprised primarily of $0.3 million (net of tax)
related to a temporary decline in available-for-sale securities.