World Fuel Services 2005 Annual Report Download - page 71

WORLD FUEL SERVICES CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
rules, regulations, court cases and other available information and are continuously monitored by management.
Management believes the tax contingencies are reasonable although the amounts may change in the future based
upon our review and new information. The ultimate resolution of any tax contingency item may be more or less
than the amount we have recorded.
4. Stockholders’ Equity
Dividends
We declared cash dividends of $0.15 per share for 2003, 2004 and 2005. Our revolving credit facility
agreement restricts the payment of cash dividends to a maximum of 35% of our net income for the four quarters
preceding the date of the dividend. The payments of the above dividends were in compliance with the credit
facility agreement.
Issuance of Common Stock
In September 2005, we completed a public offering of 4.1 million shares of our common stock at a price of
$31.00 per share. We received net proceeds of $120.3 million from the offering, after deducting $6.4 million in
commissions paid to the underwriters and $0.8 million in other expenses incurred in connection with the offering.
Common Stock Grants
Pursuant to a stock grant program for our non-employee directors, each non-employee director receives an
annual stock grant of two thousand shares of our common stock. In 2003, we adopted a Stock Deferral Plan for
non-employee directors to provide for the deferral of the stock grants. Each non-employee director may elect to
have his or her annual stock grants paid in stock units, in lieu of stock, with each stock unit being equivalent to
one share of our common stock and deferred as provided in the Stock Deferral Plan. As of each cash dividend
payment date with respect to common stock, each participant in the Stock Deferral Plan has credited to his or her
account, as maintained by us, a number of stock units equal to the quotient obtained by dividing: (a) the product
of (i) the cash dividend payable with respect to each share of common stock on such date; and (ii) the total
number of stock units credited to his or her account as of the close of business on the record date applicable to
such dividend payment date, by (b) the fair market value of one share of common stock on such dividend
payment date. Upon the participant’s termination of service as our director for any reason, or upon a change of
control, the participant receives a number of shares of common stock equal to the number of stock units credited
to his account.
The value of stock and stock units issued to non-employee directors are based on the market value of our
common stock on the date of grant and recorded as non-employee director compensation expense. Outstanding
stock units issued to non-employee directors are included as capital in excess of par value in stockholders’
equity.
We issued to our non-employee directors an aggregate of eight thousand shares of our common stock in
2003 and 2004 and six thousand shares of our common stock in 2005. In 2003, 2004 and 2005, we granted an
aggregate of six thousand shares of stock units to our non-employee directors. As of December 31, 2004 and
2005, we had issued approximately 12 thousand and 18 thousand stock units, respectively, with an aggregate
value of approximately $0.2 million and $0.4 million, respectively, which is included in capital in excess of par
value in the accompanying consolidated balance sheets.
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