NetSpend 2013 Annual Report Download - page 62

CHANGES IN TSYS’ OWNERSHIP INTEREST IN
SUBSIDIARIES: TSYS’ subsidiary GP Net
repurchased 400 common shares on December 29,
2011 from its noncontrolling interest. As a result of
the transaction, TSYS’ ownership increased to 54.08%
from 53.00%. The following table presents the effect
on TSYS’ shareholders’ equity from GP Net’s
acquisition of treasury shares:
(in thousands) Year Ended December 31, 2011
Increase in OCI ............... $ 28
Increase in additional paid in
capital .................... 77
Effect from change in
noncontrolling interests ...... $105
NOTE 18 Share-Based Compensation
General Description of Share-Based
Compensation Plans
TSYS has various long-term incentive plans under
which the Compensation Committee of the Board of
Directors has the authority to grant share-based
compensation to TSYS employees.
Employee stock options granted during or after 2006
(other than performance-based stock options)
generally become exercisable in three equal annual
installments on the anniversaries of the date of grant
and expire ten years from the date of grant. Vesting
for stock options granted during the years 2006
through 2009 (other than performance-based stock
options) accelerate upon retirement for employees
who have reached age 62 and who also have no less
than fifteen years of service, or are 65, at the date of
their election to retire. For stock options granted
during the years 2006 through 2009, share-based
compensation expense is fully recognized for plan
participants upon meeting the retirement eligibility
requirements of age and service. Employees not
retirement eligible who terminate employment only
received the shares for the full vesting periods
completed.
Stock options granted during 2010 and 2011
generally become exercisable in three equal annual
installments on the anniversaries of the date of grant
and expire ten years from the date of grant. These
options vest on a pro-rata basis upon retirement
based upon the number of months employed during
the year of retirement. For stock options granted
during 2010 and 2011, share-based compensation
expense is fully recognized for plan participants upon
meeting the retirement eligibility requirements of age
and service. Employees not retirement eligible who
terminate employment only received the shares for
the full vesting periods completed.
Stock options granted subsequent to 2011 generally
become exercisable in three equal annual
installments on the anniversaries of the date of grant
and expire ten years from the date of grant. For
employees who retire during the first 18 months of
the options term, the options vest on a pro-rata basis
based upon the number of months employed during
the year of retirement. If the employee retires after
the 18-month period, vesting is accelerated upon
retirement. When an employee meets the
requirements for retirement eligibility after the 18-
month period but before the final vesting period, the
employee is fully vested in the options at that time.
Employees not retirement eligible who terminate
employment only received the shares for the full
vesting periods completed.
Stock options granted prior to 2006 generally
become exercisable at the end of a two to three-year
period and expire ten years from the date of grant.
Vesting for stock options granted prior to 2006
accelerates upon retirement for plan participants who
have reached age 50 and who also have no less than
fifteen years of service at the date of their election to
retire. Following adoption of ASC 718, share-based
compensation expense is recognized in income over
the remaining nominal vesting period with
consideration for retirement eligibility.
Long-Term Incentive Plans
TSYS maintains the Total System Services, Inc. 2012
Omnibus Plan, Total System Services, Inc. 2007
Omnibus Plan, Total System Services, Inc. 2002 Long-
Term Incentive Plan, Total System Services, Inc. 2000
Long-Term Incentive Plan and the Amended and
Restated NetSpend Holdings, Inc. 2004 Equity
Incentive Plan for Options and Restricted Shares
Assumed by Total System Services, Inc. to advance
the interests of TSYS and its shareholders through
awards that give employees and directors a personal
stake in TSYS’ growth, development and financial
success. Awards under these plans are designed to
motivate employees and directors to devote their
best efforts to the business of TSYS. Awards will also
help TSYS attract and retain the services of
employees and directors who are in a position to
make significant contributions to TSYS’ success.
The plans are administered by the Compensation
Committee of the Company’s Board of Directors and
enable the Company to grant nonqualified and
incentive stock options, stock appreciation rights,
restricted stock and restricted stock units,
performance units or performance shares, cash-based
awards, and other stock-based awards.
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