XML 111 R20.htm IDEA: XBRL DOCUMENT v2.4.1.9
Preferred Stock (Notes)
12 Months Ended
Dec. 31, 2014
Preferred Stock  
Preferred Stock
12. Preferred Stock

The Company has authorized 10,000 shares of preferred stock at December 31, 2014 and 2013 with a $0.001 par value per share. There were no issued and outstanding shares of preferred stock at December 31, 2014 and 2013.

Prior to the completion of the IPO, the Company had authorized 1,441 and 1,058 shares of series A-1 and A-2 preferred stock, respectively, with a $0.001 par value per share, of which 1,015 redeemable Series A-1 preferred stock and 805 Series A-2 preferred stock were issued and outstanding. Upon completion of the IPO on June 12, 2013, the outstanding shares of the Company's Series A-1 and A-2 preferred stock automatically converted into 5,336 shares of common stock at a conversion rate of 1:2.84 and the cumulative unpaid dividends were satisfied through the issuance of $412 additional shares of common stock through an adjustment to the conversion rate. The Company has no authorized, issued and outstanding shares of series A-1 and A-2 preferred stock at December 31, 2014.

Dividends

Holders of redeemable Series A-1 preferred stock and Series A-2 preferred stock were entitled to cumulative dividends at the rate of 6.0% per annum of the original issue price per share of $9.94, payable when declared by the Board of Directors. Prior to the completion of the IPO, cumulative unpaid dividends on the redeemable Series A-1 preferred stock of $3,026 were considered as part of the redemption value described below. Cumulative unpaid dividends on the Series A-2 preferred stock had no impact until declared. No dividends were declared on the Series A-2 preferred stock.

Liquidation Preference

In the event of liquidation, dissolution or winding up of the Company, the holders of redeemable Series A-1 preferred stock and Series A-2 preferred stock would have received the first claim to the distributed net assets in the amount of $9.94 per share plus accrued but unpaid dividends. In the event there were not enough funds to cover distributions to all stockholders, the entire amount of assets available to be distributed would have been distributed ratably among the holders of the preferred stock based on the total preferential amount each holder would be entitled to receive if sufficient funds were available.

Conversion

Immediately prior to an initial public offering, each share of redeemable Series A-1 preferred stock and Series A-2 preferred stock were required to be converted into common stock on a 1:2.84 basis. The outstanding shares of the Company's Series A-1 and A-2 preferred stock automatically converted into 5,336 shares of common stock at a conversion rate of 1:2.84 and the cumulative unpaid dividends were satisfied through the issuance of 412 additional shares of common stock through an adjustment to the conversion rate. The series A-2 preferred stock had a beneficial conversion feature that was triggered by the IPO, and the Company recognized $7,161 as a deemed dividend.

Series A-1 preferred stock had the following additional characteristics:

Board of Directors Representation

Holders of redeemable Series A-1 preferred stock were entitled to representation of one seat on the Board of Directors.

Series A-1 Redemption Right

The Series A-1 preferred stock was eligible for redemption at the option of the holder beginning in October 2014, the holders having waived their rights to require the Company to redeem the Series A-1 preferred stock until that date. At that time, to the extent the holders chose to redeem the stock, the Company was required to raise additional capital or debt, or renegotiate redemption terms with the Series A-1 holders.

The carrying value of redeemable Series A-1 preferred stock was increased by periodic accretions so that the carrying value was equal to the redemption value at the balance sheet date. The redeemable Series A-1 preferred stock was valued at $43,135 at September 30, 2012, which was determined by using the greater of fair market value or the sum of $7.00 multiplied by 2.84 plus cumulative unpaid dividends. Accretion of $3,549 and $3,373, respectively, was charged to additional paid-in capital for the years ended September 30, 2013 and 2012. All outstanding redeemable Series A-1 preferred stock automatically converted into common stock upon completion of the IPO in June 2013.