XML 22 R9.htm IDEA: XBRL DOCUMENT v2.4.0.6
Stock Repurchase Program
3 Months Ended
Dec. 31, 2012
Stock Repurchase Program  
Stock Repurchase Program

3.              Stock Repurchase Program

 

In August 2011, the Company’s Board of Directors authorized a stock repurchase program (Repurchase Program), pursuant to which the Company could initially purchase up to $200 million of its common stock. The Company completed the initial authorization to purchase $200 million of its common stock during the quarter ended June 30, 2012. In August 2012, the Company’s Board of Directors authorized an additional $300 million to repurchase its common stock under the Repurchase Program. Share repurchases under the Repurchase Program can be made through open market purchases, unsolicited or solicited privately negotiated transactions or other methods, including pursuant to a Rule 10b5-1 plan. As of December 31, 2012, $64.6 million of shares was available for repurchase of the Company’s common stock pursuant to the Repurchase Program. Repurchased shares are retired, but remain authorized for registration and issuance in the future.

 

Accelerated Share Repurchase

 

In connection with the Repurchase Program, the Company entered into an accelerated share repurchase (ASR) agreement with Bank of America, N.A. (Bank of America) on August 16, 2011. Under the agreement for the ASR, the Company agreed to repurchase $100 million of its common stock from Bank of America. During the quarter ended September 30, 2011, Bank of America delivered 4.3 million shares to the Company, at which point the Company’s shares outstanding were reduced and accounted for as a reduction to retained earnings. The number of shares delivered was the minimum amount of shares Bank of America was contractually obligated to provide under the ASR agreement.

 

The number of shares that ultimately were repurchased by the Company under the ASR agreement was based upon the volume-weighted average share price of the Company’s common stock during the term of the ASR agreement, less an agreed discount, subject to collar provisions which established a maximum and minimum price and other customary conditions under the ASR agreement. The ASR agreement was settled in full on March 7, 2012 and the total number of shares repurchased was 4.8 million at an average price of $20.97 per share.

 

Rule 10b5-1 Repurchase Plan and Open Market Purchases

 

In connection with the Repurchase Program, the Company entered into Rule 10b5-1 repurchase plans. The timing, nature and amount of purchases depended on a variety of factors, including market conditions and the volume limit defined by Rule 10b-18.

 

As of June 30, 2012, the Company had repurchased under the initial authorization approximately 4.4 million shares under the Rule 10b5-1 plans and through open market purchases, at an average price of $22.59 per share, for a total cost of approximately $100.0 million, thereby completing its initial authorization under the Repurchase Program.

 

As of December 31, 2012, the Company had repurchased, under the second authorization, through open market purchases and purchases made under a Rule 10b5-1 plan, 10.8 million shares at an average price of $21.77 per share, for a total cost of $235.4 million, which included 0.3 million shares repurchased in transactions that were settled in the second quarter of fiscal 2013.

 

$500 million share repurchase authorization

 

In January 2013, the Company’s Board of Directors authorized an additional $500 million to repurchase its common stock under the Repurchase Program.