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Preferred Stock
3 Months Ended
Mar. 31, 2012
Preferred Stock [Abstract]  
Preferred Stock

Note 8 — Preferred Stock

In September 2009, we issued 1.4 million shares of convertible preferred stock ("Series A Preferred Stock") and received net proceeds of $135.5 million ($100 per share before underwriters' discounts and commissions and offering expenses). In June 2011, we issued 1.7 million shares of 8% convertible perpetual preferred stock ("Series B Preferred Stock") and received net proceeds of $123.3 million ($90 per share before underwriters' discounts and commissions, option contract costs (discussed below) and offering expenses). The Series B Preferred Stock has terms and features which are substantially identical to the convertible preferred stock issued in 2009 (collectively, the "Preferred Stock"). Each share of convertible preferred stock is perpetual, has no voting rights, has a liquidation preference of $100, pays cumulative dividends at an annual rate of 8% payable in cash, shares of our common stock, or a combination thereof, and is convertible at any time, at the option of the holder, into 4.5045 shares of common stock. After September 30, 2014, we have the option to force conversion to common stock provided that the prevailing common stock market price exceeds the conversion price by 150% on average for a stipulated period of time. In the event of certain fundamental changes of the Company, each share of convertible preferred stock is subject to adjustment to prevent dilution and would receive a conversion benefit as defined in the related statement of resolutions that established the convertible preferred stock.

In conjunction with issuance of the Series B Preferred Stock, we purchased for $26.5 million capped-call options ("Options") to cover all 14.1 million shares of common stock issuable upon conversion of the Series B Preferred Stock and the preferred stock we issued in 2009. The Options allow us to prevent dilution due to common stock issuance upon preferred stock conversion up to a price per common share of $27.50. The shares of common stock acquirable under the Options are indexed to our common stock price at the time of exercise and the Options can only be settled in common stock. As a result, the purchase price of the Options is recorded as a component of additional paid-in capital within Shareholders' Equity in the accompanying Consolidated Financial Statements.

A portion of the Series B Preferred Stock is classified as temporary equity because, in the event of certain fundamental changes, as defined in the statement of resolutions, the Company could be required to issue in the aggregate more shares of common stock pursuant to the conversion ratio most favorable to the holders than currently are authorized and unissued (the "Common Share Shortfall"). The value of the temporary equity is deemed to be the number of shares of Preferred Stock that would account for such common share shortfall times the $90.00 fair value per share. This amount is revalued in each reporting period as the Common Share Shortfall changes, and at such time as we have sufficient authorized and unissued common shares to satisfy the most favorable conversion obligation possible under the statement of resolutions, this amount will be reclassified to permanent equity.

During the first quarter of 2012 an aggregate 20,000 shares of Series A Preferred Stock were converted into 90,090 shares of common stock.