NetSpend 2012 Annual Report Download - page 70

NOTE 26 Earnings Per Share
The following table illustrates basic and diluted EPS under the guidance of ASC 260:
December 31, 2012 December 31, 2011 December 31, 2010
(in thousands, except per share data)
Common
Stock Participating Securities Common Stock Participating Securities Common Stock Participating Securities
Basic EPS:
Net income ................................................. $244,280 220,559 193,947
Less income allocated to nonvested awards ...................... (800) 800 (805) 805 (959) 959
Net income allocated to common stock for EPS calculation(a) ..... $243,480 800 219,754 805 192,988 959
Average common shares outstanding(b) ......................... 187,403 627 191,239 707 195,378 975
Basic EPS(a)/(b) .............................................. $ 1.30 1.28 1.15 1.14 0.99 0.98
Diluted EPS:
Net income ................................................. $244,280 220,559 193,947
Less income allocated to nonvested awards ...................... (796) 796 (804) 804 (959) 959
Net income allocated to common stock for EPS calculation(c) ..... $243,484 796 219,755 804 192,988 959
Average common shares outstanding ........................... 187,403 627 191,239 707 195,378 975
Increase due to assumed issuance of shares related to common
equivalent shares outstanding ............................... 1,262 345 193
Average common and common equivalent shares outstanding(d) .... 188,665 627 191,584 707 195,571 975
Diluted EPS(c)/(d) ............................................ $ 1.29 1.27 1.15 1.14 0.99 0.98
The diluted EPS calculation excludes stock options and nonvested awards that are convertible into 2.9 and 3.6 million common
shares for the years ended December 31, 2012 and 2011, respectively, and excludes 9.0 million common shares for the year ended
December 31, 2010, because their inclusion would have been anti-dilutive.
NOTE 27 Subsequent Events
On February 19, 2013, TSYS and NetSpend, a leading
provider of general purpose reloadable (GPR) prepaid debit
cards and related financial services to underbanked consumers
in the United States, announced that they entered into a
definitive agreement pursuant to which, upon the terms and
subject to the conditions set forth in the agreement, TSYS will
acquire NetSpend in an all cash transaction valued at
approximately $1.4 billion. Under terms of the agreement,
NetSpend shareholders will receive $16.00 in cash for each
share of NetSpend common stock. The Company intends to
finance the NetSpend acquisition with cash on hand and
approximately $1.3 billion of additional indebtedness. In
connection with the transaction, the Company entered into a
commitment letter with certain of its lenders to provide a
$1.2 billion bridge term loan facility to finance the NetSpend
acquisition to the extent the Company has not obtained
alternative financing before the closing of the transaction. The
transaction is currently expected to close in mid-2013 and is
subject to customary closing conditions, including approval by
NetSpend shareholders, and required regulatory approvals.
For additional information regarding the transaction, see
TSYS’ Current Report on Form 8-K filed on February 19, 2013,
which includes the press release announcing the NetSpend
acquisition, the merger agreement for the transaction, and the
commitment letter for the bridge term loan facility. There can
be no assurance that the proposed acquisition will be
completed, or if it is completed, that the expected benefits of
the transaction will be realized.
Management performed an evaluation of the Company’s
activities through February 26, 2013, the issuance date of
these financial statements, and has concluded that other than
as set forth above, there are no significant subsequent events
requiring disclosure.
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