TJ Maxx 1997 Annual Report Download - page 13

28
T h e re has been a combined total of 511,917 shares, 35,000 shares and 20,000 shares for deferre d ,
restricted and perf o rmance based awards issued for the fiscal years ended January 1998, 1997 and 1996,
re s p e c t i v e l y. There were 150,000 and 7,000 shares forfeited for the fiscal years ended January 1998 and
J a n u a ry 1996, respectively (no shares were forfeited for the fiscal year ended January 1997). The
weighted average market value per share of these stock awards at grant date was $21.79, $12.00 and
$6.44 for fiscal 1998, 1997 and 1996, re s p e c t i v e l y.
During fiscal 1998, the Company formed a deferred stock compensation plan for its outside dire c t o r s
which replaced the Company’s re t i rement plan for directors. Deferred shares were issued equal to the cur-
rent obligation under the re t i rement plan as of December 31, 1997. Additional share awards valued at
$10,000 will be issued annually to each eligible dire c t o r. Currently there are 8,771 deferred shares out-
standing, actual shares will be issued at re t i r ement. The Company has 50,000 shares held in tre a s u ry fro m
which the Company will issue such shares.
F . C a p i t a l S t o c k a n d E a r n i n g s P e r S h a r e
C a p i t a l S t o c k : The Company distributed a two-for-one stock split, effected in the form of a 100% stock
dividend, on June 26, 1997 to shareholders of re c o rd on June 11, 1997, which resulted in the issuance
of 79.8 million shares of common stock and a corresponding decrease of $79.8 million in additional
paid-in capital. All historical earnings per share amounts have been restated to reflect the two-for- o n e
stock split. Reference to common stock activity before the distribution of the split has not been re s t a t-
ed unless otherwise noted. All activity after the distribution date reflects the two-for-one stock split.
In April 1992, the Company issued 250,000 shares of Series A cumulative convertible pre f e rred stock
in a private offering. As of June 1996, pursuant to a call for redemption, the Series A pre f e rred stock was
c o n v e rted into 1,190,475 shares of common stock.
In August 1992, the Company issued 1,650,000 shares of Series C cumulative convertible pre f e rre d
stock in a public offering. As of September 1996, pursuant to a call for redemption, the Series C pre f e rre d
stock was converted into 3,177,844 shares of common stock.
On November 17, 1995, the Company issued its Series D and Series E convertible pre f e rred stock as part
of the purchase price for Marshalls. The 250,000 shares of Series D pre f e rred stock, with a face value of
$25 million, carried an annual dividend rate of $1.81 per share and was automatically converted into
1,349,527 shares of common stock on November 17, 1996.
The shares of Series E pre f e rred stock, with 1,500,000 shares initially issued at a face value of $150
million, carry an annual dividend rate of $7.00 per share and is mandatorily converted into common
s h a res on November 17, 1998 unless converted earlier. Through January 31, 1998, shareholders con-
v e rted 770,200 shares of Series E pre f e rred stock into 8.3 million shares of common stock and 2,500
s h a res were re p u rchased by the Company. The Company paid $3.8 million to induce conversion of the
p re f e rred shares. The common shares issuable on conversion of the outstanding Series E pre f e rred stock
will vary depending on the market price of common stock at the time of conversion and ranges from a
minimum of 7.9 million shares to a maximum of 9.4 million shares of common stock. Based on the mar-
ket price of the common stock as of January 31, 1998, the minimum number of shares would be issued.
The 727,300 shares of the Company’s outstanding Series E pre f e rred stock at January 31, 1998 has an
a g g regate liquidation pre f e rence of $72.7 million. There is an aggregate of 9,422,513 common share s
re s e rved for the conversion of Series E pre f e rred stock, the maximum number of shares that may be
issued. The Series E pre f e r red stock is senior to the common stock of the Company with respect to pay-
ment of dividends and upon liquidation. There are no voting rights for pre f e rred stock unless dividends
a re in arrears for a specified number of periods.
Dividends on the outstanding Series E pre f e rred stock are paid quarterly on the first business day of
each calendar quart e r, the Company accrues dividends evenly throughout the year. In addition, the induce-
ment fees paid on the conversion of the Series E pre f e rred stock during fiscal 1998 have been classified as
p re f e rred dividends. The Company re c o rded aggregate dividends on its pre f e rred stock of $11.7 million in
fiscal 1998, $13.7 million in fiscal 1997 and $9.4 million in fiscal 1996. The pre f e rred dividends re d u c e
net income in computing net income available to common share h o l d e r s .
During fiscal 1997, the Company replaced the June 1995 shelf registration statement with another
shelf registration statement which currently provides for the issuance of up to $600 million of debt, com-
mon stock or pre f e rred stock.