Tyson Foods 2014 Annual Report Download - page 68

NOTE 8: EQUITY
Capital Stock
We have two classes of capital stock, Class A stock, $0.10 par value and Class B Common Stock, $0.10 par value (Class B stock). Holders of
Class B stock may convert such stock into Class A stock on a share-for-share basis. Holders of Class B stock are entitled to 10 votes per share,
while holders of Class A stock are entitled to one vote per share on matters submitted to shareholders for approval. As of September 27, 2014 ,
Tyson Limited Partnership (the TLP) owned 99.985% of the outstanding shares of Class B stock and the TLP and members of the Tyson
family owned, in the aggregate, 1.78% of the outstanding shares of Class A stock, giving them, collectively, control of approximately 70.14%
of the total voting power of the outstanding voting stock.
The Class B stock is considered a participating security requiring the use of the two-class method for the computation of basic earnings per
share. The two-class computation method for each period reflects the cash dividends paid for each class of stock, plus the amount of allocated
undistributed earnings (losses) computed using the participation percentage, which reflects the dividend rights of each class of stock. Basic
earnings per share were computed using the two-class method for all periods presented. The shares of Class B stock are considered to be
participating convertible securities since the shares of Class B stock are convertible on a share-for-share basis into shares of Class A stock.
Diluted earnings per share were computed assuming the conversion of the Class B shares into Class A shares as of the beginning of each
period.
Dividends
Cash dividends cannot be paid to holders of Class B stock unless they are simultaneously paid to holders of Class A stock. The per share
amount of the cash dividend paid to holders of Class B stock cannot exceed 90% of the cash dividend simultaneously paid to holders of
Class A stock. We pay quarterly cash dividends to Class A and Class B shareholders. We paid Class A dividends per share of $0.30 and Class
B dividends per share of $0.27 in fiscal 2014 and 2013, respectively. Fiscal 2013 included a special dividend of $0.10 per share for Class A
stock and $0.09 per share for Class B. We paid Class A dividends per share of $0.16 and Class B dividends per share of $0.144 in fiscal 2012 .
On November 13, 2014, the Board of Directors increased the quarterly dividend previously declared on July 30, 2014, to $0.10
per share on our
Class A stock and $0.09 per share on our Class B stock. The increased quarterly dividend is payable on December 15, 2014, to shareholders of
record at the close of business on December 1, 2014.
Share Repurchases
On January 30, 2014, our Board of Directors approved an increase of 25 million shares authorized for repurchase under our share repurchase
program. As of September 27, 2014 , 32.1 million shares remained available for repurchase. The share repurchase program has no fixed or
scheduled termination date and the timing and extent to which we repurchase shares will depend upon, among other things, our working capital
needs, market conditions, liquidity targets, our debt obligations and regulatory requirements. In addition to the share repurchase program, we
purchase shares on the open market to fund certain obligations under our equity compensation plans.
A summary of cumulative share repurchases of our Class A Stock is as follows:
Share Issuance
In fiscal 2014, we issued 23.8 million shares of our Class A stock, to provide funding for the Hillshire Brands acquisition. Total proceeds, net
of underwriting discounts and other offering related fees and expenses were $873 million .
60
in millions
September 27, 2014 September 28, 2013 September 29, 2012
Shares Dollars Shares Dollars Shares Dollars
Shares repurchased:
Under share repurchase program
7.1
$
250
21.1
$
550
12.5
$
230
To fund certain obligations under equity compensation plans
1.2
45
2.8
64
1.8
34
Total share repurchases
8.3
$
295
23.9
$
614
14.3
$
264