Lexmark 2013 Annual Report Download - page 116

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In August 2012, the Company received authorization from the Board of Directors to repurchase an additional $200 million of its
Class A Common Stock for a total repurchase authority of $4.85 billion. As of December 31, 2013, there was approximately $169
million of share repurchase authority remaining. This repurchase authority allows the Company, at management’s discretion, to
selectively repurchase its stock from time to time in the open market or in privately negotiated transactions depending upon market
price and other factors. During 2013, the Company repurchased approximately 2.7 million shares at a cost of approximately $82
million. During 2012, the Company repurchased approximately 8.1 million shares at a cost of approximately $190 million. As of
December 31, 2013, since the inception of the program in April 1996, the Company had repurchased approximately 110.3 million
shares of its Class A Common Stock for an aggregate cost of approximately $4.68 billion. As of December 31, 2013, the Company
had reissued approximately 0.5 million shares of previously repurchased shares in connection with certain of its employee benefit
programs. As a result of these issuances as well as the retirement of 44.0 million, 16.0 million and 16.0 million shares of treasury
stock in 2005, 2006 and 2008, respectively, the net treasury shares outstanding at December 31, 2013, were 33.8 million. The retired
shares resumed the status of authorized but unissued shares of Class A Common Stock.
Accelerated Share Repurchase Agreements
The Company executed four accelerated share repurchase (“ASR”) Agreements with financial institution counterparties in 2013,
resulting in a total of 2.7 million shares repurchased at a cost of $82 million. The impact of the four ASRs is included in the share
repurchase totals provided in the preceding paragraphs. There were no outstanding ASR Agreements as of December 31, 2013.
Under the terms of the ASR Agreements, the Company paid an agreed upon amount targeting a certain number of shares based on the
closing price of the Company's Class A Common Stock on the date of each agreement. The Company took delivery of 85% of the
shares in the initial transaction and the remaining 15% holdback provision payment was held back until final settlement of each
contract occurred. The final number of shares to be delivered by the counterparty under the ASR Agreements was dependent on the
average of the daily volume weighted-average price of the Company's Class A Common Stock over the agreements' trading period, a
discount, and the initial number of shares delivered. Under the terms of the ASR Agreements, the Company would either receive
additional shares from the counterparty or be required to deliver additional shares or cash to the counterparty in the final settlement.
The Company controls its election to either deliver additional shares or cash to the counterparty.
The ASR Agreements discussed in the preceding paragraph were accounted for as initial treasury stock transactions and forward stock
purchase contracts. The initial repurchase of shares resulted in a reduction of the outstanding shares used to calculate the weighted-
average common shares outstanding for basic and diluted net income per share on the effective date of the agreements. The forward
stock purchase contract (settlement provision) was considered indexed to the Company's own stock and was classified as an equity
instrument under accounting guidance applicable to contracts in an entity's own equity.
Dividends
The Company’s dividend activity during the year ended December 31, 2013 was as follows:
Lexmark International, Inc.
Class A Common Stock
Declaration Date Record Date Payment Date
Dividend Per
Share Cash Outlay
February 21, 2013 March 4, 2013 March 15, 2013 $ 0.30 $ 19.1
April 25, 2013 May 31, 2013 June 14, 2013 0.30 18.9
July 25, 2013 August 30, 2013 September 13, 2013 0.30 18.7
October 24, 2013 November 29, 2013 December 13, 2013 0.30 18.6
Total Dividends $ 1.20 $ 75.3
The payment of the cash dividends also resulted in the issuance of additional dividend equivalent units to holders of restricted stock
units. Diluted weighted-average Lexmark Class A share amounts presented reflect this issuance. All cash dividends and dividend
equivalent units are accounted for as reductions of Retained earnings.
Accumulated Other Comprehensive Earnings (Loss)
The following tables provide the tax benefit or expense attributed to each component of Other comprehensive (loss) earnings:
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