Pitney Bowes 2013 Annual Report Download - page 72

PITNEY BOWES INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Tabular dollars in thousands, except per share amounts)
61
we are indemnified against any payments we may be required to make. However, the potential for a difference in the timing of payments
which may be due to taxing authorities and the timing of receipts due to us under the partnership agreement may cause fluctuations in
our cash flows in future periods. Further, if we do not recover under the indemnification provisions of the partnership agreement, the
amount of tax and interest due as a result of this matter could be as much as $100 million.
9. Noncontrolling Interests (Preferred Stockholders’ Equity in Subsidiaries)
Pitney Bowes International Holdings, Inc. (PBIH), a subsidiary, has 300,000 shares, or $300 million, of outstanding perpetual voting
preferred stock (the Preferred Stock) held by certain institutional investors. The holders of the Preferred Stock are entitled as a group to
25% of the combined voting power of all classes of capital stock of PBIH. All outstanding common stock of PBIH, representing the
remaining 75% of the combined voting power of all classes of capital stock, is owned directly or indirectly by the company. The Preferred
Stock is entitled to cumulative dividends at a rate of 6.125% through 2016 after which it becomes callable and, if it remains outstanding,
will yield a dividend that increases by 50% every six months thereafter. No dividends were in arrears at December 31, 2013 or December 31,
2012. There was no change in the carrying value of noncontrolling interests during the years ended December 31, 2013 or 2012.
10. Stockholders' Equity
Preferred Stock
We have two classes of Preferred Stock issued and outstanding: the 4% Preferred Stock (the Preferred Stock) and the $2.12 Preference
Stock (the Preference Stock). The Preferred Stock is entitled to cumulative dividends of $2 per year and can be converted into 24.24
shares of common stock, subject to adjustment in certain events. The Preferred Stock is redeemable at our option at a price of $50 per
share, plus dividends accrued through the redemption date. We are authorized to issue 600,000 shares of Preferred Stock. At December 31,
2013 and 2012, there were 74 shares and 85 shares outstanding, respectively. There are no unpaid dividends in arrears.
The Preference Stock is entitled to cumulative dividends of $2.12 per year and can be converted into 16.53 shares of common stock,
subject to adjustment in certain events. The Preference Stock is redeemable at our option at a price of $28 per share. We are authorized
to issue 5,000,000 shares of Preference Stock. At December 31, 2013 and 2012, there were 21,838 shares and 23,928 shares outstanding,
respectively. There are no unpaid dividends in arrears.
Common Stock
We have 480,000,000 shares of common stock authorized and 323,337,912 shares were issued at December 31, 2013 and 2012. At
December 31, 2013, 39,810,385 shares were reserved for issuance under our stock plans, dividend reinvestment program and for the
conversion of the Preferred Stock and Preference Stock. The following table summarizes the changes in Common Stock and Treasury
Stock:
Treasury Common Stock
Balance at December 31, 2010 119,906,910 203,431,002
Repurchases of common stock 4,692,200 (4,692,200)
Issuance of common stock (963,448) 963,448
Conversions to common stock (48,820) 48,820
Balance at December 31, 2011 123,586,842 199,751,070
Issuance of common stock (1,118,089) 1,118,089
Conversions to common stock (14,888) 14,888
Balance at December 31, 2012 122,453,865 200,884,047
Issuance of common stock (1,163,668) 1,163,668
Conversions to common stock (34,807) 34,807
Balance at December 31, 2013 121,255,390 202,082,522