General Motors 2012 Annual Report Download - page 160

GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Series A Preferred Stock
The Series A Preferred Stock ranks senior with respect to liquidation preference and dividend rights to our common stock and
Series B Preferred Stock and any other class or series of stock that we may issue. In the event of any voluntary or involuntary
liquidation, dissolution or winding-up of our affairs, a holder of Series A Preferred Stock will be entitled to be paid, before any
distribution or payment may be made to any holders of common stock or Series B Preferred Stock, the liquidation amount and the
amount of any accrued and unpaid dividends, if any, whether or not declared, prior to such distribution or payment date. On or after
December 31, 2014, the Series A Preferred Stock may be redeemed, in whole or in part, for cash at a price per share equal to the
$25.00 per share liquidation amount, plus any accrued and unpaid dividends. Upon a redemption or purchase of any or all Series A
Preferred Stock, the difference, if any, between the recorded amount of the Series A Preferred Stock being redeemed or purchased and
the consideration paid would be recorded as a charge to Net income attributable to common stockholders. If all of the Series A
Preferred Stock were to be redeemed or purchased at its par value, the amount of the charge would be $1.4 billion.
In December 2010 we purchased 84 million shares of Series A Preferred Stock, held by the UST, at a price equal to 102% of the
aggregate liquidation amount, for $2.1 billion. The purchase of the UST’s Series A Preferred Stock resulted in a charge of $677
million recorded in Cash dividends paid on Series A Preferred Stock and cumulative dividends on Series B Preferred Stock and
charge related to purchase of Series A Preferred Stock.
Series B Preferred Stock
The Series B Preferred Stock, with respect to dividend rights and rights upon our liquidation, winding-up or dissolution, ranks:
(1) senior to our common stock and to each other class of capital stock or series of preferred stock the terms of which do not expressly
provide that such class or series ranks senior to, or on a parity with, the Series B Preferred Stock; (2) on a parity with any class of
capital stock or series of preferred stock the terms of which expressly provide that such class or series will rank on a parity with the
Series B Preferred Stock; and (3) junior to our Series A Preferred Stock and to each class of capital stock or series of preferred stock
the terms of which expressly provide that such class or series will rank senior to the Series B Preferred Stock.
Each share of the Series B Preferred Stock, unless previously converted, will automatically convert on December 1, 2013 into
shares of our common stock. The number of shares of our common stock issuable upon mandatory conversion of each share of Series
B Preferred Stock is determined based on the applicable market value of our common stock subject to anti-dilution adjustments and
accumulated and unpaid dividends. The applicable market value of our common stock is the average of the closing prices of our
common stock over the 40 consecutive trading day period ending on the third trading day immediately preceding the mandatory
conversion date. Holders of the Series B Preferred Stock have the right to convert their shares at any time prior to the mandatory
conversion date at a conversion ratio of 1.2626 shares of our common stock for each share of the Series B Preferred Stock that is
optionally converted, subject to anti-dilution, make-whole and other adjustments.
If the applicable market value of our common stock upon mandatory conversion falls within a range of $33.00-$39.60 per common
share, the holder receives a variable number of shares of our common stock with a value equal to the liquidation preference plus
accumulated dividends. If the applicable market value is not within this range, there is a fixed conversion ratio equaling 1.2626 shares
of common stock for each share of Series B Preferred Stock when the applicable market value of our common stock is greater than
$39.60, and 1.5152 shares of common stock for each share of Series B Preferred Stock when the applicable market value of our
common stock is less than $33.00. The fixed conversion ratios will be adjusted for events that would otherwise dilute a Series B
Preferred Stockholder’s interest.
In the three months ended December 31, 2012, holders of our Series B Preferred Stock converted 11,204 shares into 14,145 shares
of common stock.
General Motors Company 2012 ANNUAL REPORT 157