Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2015 | Apr. 30, 2015 | |
Document and Entity Information | ||
Entity Registrant Name | ADCARE HEALTH SYSTEMS, INC | |
Entity Central Index Key | 1004724 | |
Document Type | 10-Q | |
Document Period End Date | 31-Mar-15 | |
Amendment Flag | FALSE | |
Current Fiscal Year End Date | -19 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 19,802,454 | |
Document Fiscal Year Focus | 2015 | |
Document Fiscal Period Focus | Q1 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents | $10,680 | $10,735 |
Restricted cash and investments | 3,303 | 3,321 |
Accounts receivable, net of allowance of $7,660 and $6,708 | 23,879 | 24,294 |
Prepaid expenses and other | 2,650 | 1,766 |
Deferred tax asset | 569 | 569 |
Assets of disposal group held for sale | 7,231 | 5,813 |
Assets of variable interest entity held for sale | 5,954 | 5,924 |
Total current assets | 54,266 | 52,422 |
Restricted cash and investments | 4,769 | 5,456 |
Property and equipment, net | 132,994 | 135,585 |
Intangible assets - bed licenses | 2,471 | 2,471 |
Intangible assets - lease rights, net | 3,920 | 4,087 |
Goodwill | 4,224 | 4,224 |
Lease deposits | 1,683 | 1,683 |
Deferred loan costs, net | 3,597 | 3,464 |
Other assets | 529 | 569 |
Total assets | 208,453 | 209,961 |
Current liabilities: | ||
Current portion of notes payable and other debt | 5,430 | 2,537 |
Current portion of convertible debt, net of discounts | 8,349 | 14,000 |
Revolving credit facilities and lines of credit | 3,823 | 5,576 |
Accounts payable | 16,564 | 16,434 |
Accrued expenses | 17,474 | 15,653 |
Liabilities of disposal group held for sale | 6,180 | 5,197 |
Liabilities of variable interest entity held for sale | 5,958 | 5,956 |
Total current liabilities | 63,778 | 65,353 |
Notes payable and other debt, net of current portion: | ||
Senior debt, net of discounts | 106,631 | 110,023 |
Bonds, net of discounts | 7,014 | 7,011 |
Convertible debt, net of discounts | 7,336 | 0 |
Revolving credit facilities | 1,050 | 1,059 |
Other liabilities | 2,262 | 2,129 |
Deferred tax liability | 605 | 605 |
Total liabilities | 188,676 | 186,180 |
Commitments and contingency (Note 13) | ||
Preferred stock, no par value; 5,000 shares authorized; 950 shares issued and outstanding, redemption amount $23,750 at March 31, 2015 and December 31, 2014 | 20,392 | 20,392 |
Stockholders’ equity: | ||
Common stock and additional paid-in capital, no par value; 55,000 shares authorized; 19,664 and 19,151 issued and outstanding at March 31, 2015 and December 31, 2014, respectively | 63,787 | 61,896 |
Accumulated deficit | -61,732 | -56,067 |
Total stockholders’ equity | 2,055 | 5,829 |
Noncontrolling interest in subsidiary | -2,670 | -2,440 |
Total equity / (deficit) | -615 | 3,389 |
Total liabilities and equity / (deficit) | $208,453 | $209,961 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, except Share data, unless otherwise specified | ||
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance (in dollars) | $7,660 | $6,708 |
Preferred stock, par value (in dollars per share) | $0 | $0 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 950,000 | 950,000 |
Preferred stock, shares outstanding | 950,000 | 950,000 |
Preferred stock, redemption amount | $23,750 | $23,750 |
Common stock and additional paid-in capital, par value (in dollars per share) | $0 | $0 |
Common stock and additional paid-in capital, shares authorized | 55,000,000 | 55,000,000 |
Common stock and additional paid-in capital, shares issued | 19,664,000 | 19,664,000 |
Common stock and additional paid-in capital, shares outstanding | 19,151,000 | 19,151,000 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Revenues: | ||
Patient care revenues | $46,145 | $46,527 |
Management revenues | 218 | 482 |
Rental revenues | 1,340 | 296 |
Total revenues | 47,703 | 47,305 |
Expenses: | ||
Cost of services (exclusive of facility rent, depreciation and amortization) | 41,221 | 38,576 |
General and administrative expense | 3,170 | 4,559 |
Facility rent expense | 1,931 | 1,659 |
Depreciation and amortization | 1,706 | 1,786 |
Total expenses | 48,028 | 46,580 |
Income (loss) from operations | -325 | 725 |
Other Income (Expense): | ||
Interest expense, net | -2,537 | -2,622 |
Loss on extinguishment of debt | -680 | -583 |
Other expense | -280 | -110 |
Total other expense, net | -3,497 | -3,315 |
Loss from continuing operations before income taxes | -3,822 | -2,590 |
Income tax expense | -20 | -8 |
Loss from continuing operations | -3,842 | -2,598 |
Income (loss) from discontinued operations, net of tax | -1,407 | 75 |
Net loss | -5,249 | -2,523 |
Net loss attributable to noncontrolling interests | 230 | 173 |
Net loss attributable to AdCare Health Systems, Inc. | -5,019 | -2,350 |
Preferred stock dividend | -646 | -646 |
Net loss attributable to AdCare Health Systems, Inc. Common Stockholders | ($5,665) | ($2,996) |
Net loss per Share of Common Stock attributable to AdCare Health Systems, Inc. Common Stockholders-Basic (in dollars per share) | ||
Continuing Operations | ($0.22) | ($0.18) |
Discontinued Operations | ($0.07) | $0 |
Net Loss per Common Share-Basic (in dollars per share) | ($0.29) | ($0.18) |
Net loss per Share of Common Stock attributable to AdCare Health Systems, Inc. Common Stockholders-Diluted (in dollars per share) | ||
Continuing Operations | ($0.22) | ($0.18) |
Discontinued Operations | ($0.07) | $0 |
Net Loss per Common Share-Diluted (in dollars per share) | ($0.29) | ($0.18) |
Weighted Average Shares of Common Stock Outstanding: | ||
Basic | 19,218 | 16,916 |
Diluted | 19,218 | 16,916 |
Consolidated_Statements_of_Sto
Consolidated Statements of Stockholders' Equity (USD $) | Total | Common Stock and Additional Paid-in Capital | Accumulated Deficit | Noncontrolling Interests |
In Thousands, unless otherwise specified | ||||
Balances at Dec. 31, 2014 | $3,389 | $61,896 | ($56,067) | ($2,440) |
Balances (in shares) at Dec. 31, 2014 | 19,664 | 19,151 | ||
Increase (Decrease) in Stockholders' Equity | ||||
Stock-based compensation expense | 203 | 203 | ||
Exercises of options and warrants | 1,688 | 1,688 | ||
Exercises of options and warrants (in shares) | 453 | |||
Issuance of restricted stock, net (shares) | 40 | |||
Issuance of restricted stock, net | 0 | 0 | ||
Preferred stock dividend | -646 | -646 | ||
Net loss | -5,249 | -5,019 | -230 | |
Balances at Mar. 31, 2015 | ($615) | $63,787 | ($61,732) | ($2,670) |
Balances (in shares) at Mar. 31, 2015 | 19,664 | 19,644 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Cash flows from operating activities: | ||
Net loss | ($5,249) | ($2,523) |
(Income) loss from discontinued operations, net of tax | 1,407 | -75 |
Loss from continuing operations | -3,842 | -2,598 |
Adjustments to reconcile net loss from continuing operations to net cash (used in) provided by operating activities: | ||
Depreciation and amortization | 1,706 | 1,786 |
Warrants issued for services | 0 | 87 |
Stock-based compensation expense | 203 | 513 |
Lease expense in excess of cash paid | 195 | 57 |
Amortization of deferred financing costs | 353 | 444 |
Amortization of debt discounts and premiums | -4 | -20 |
Loss on debt extinguishment | 680 | 583 |
Bad debt expense | 1,355 | 870 |
Changes in operating assets and liabilities: | ||
Accounts receivable | -1,981 | -1,903 |
Prepaid expenses and other | -969 | -3,021 |
Other assets | 40 | 19 |
Accounts payable and accrued expenses | 2,588 | -1,822 |
Net cash provided by (used in) operating activities - continuing operations | 324 | -5,005 |
Net cash used in operating activities - discontinued operations | -932 | -881 |
Net cash used in operating activities | -608 | -5,886 |
Cash flows from investing activities: | ||
Change in restricted cash and investments | 705 | 7,198 |
Purchase of property and equipment | -376 | -1,577 |
Net cash provided by investing activities - continuing operations | 329 | 5,621 |
Net cash used in investing activities - discontinued operations | -39 | -285 |
Net cash provided by investing activities | 290 | 5,336 |
Cash flows from financing activities: | ||
Proceeds from debt | 21,715 | 3,255 |
Proceeds from convertible debt | 1,685 | 6,055 |
Repayment on notes payable | -21,905 | -4,839 |
Repayment on bonds payable | 0 | -3,049 |
Repayment on convertible debt | 0 | -4,014 |
Proceeds from lines of credit | 13,693 | 18,039 |
Repayment on lines of credit | -15,454 | -18,775 |
Debt issuance costs | -513 | -444 |
Exercise of warrants and options | 1,688 | 2,335 |
Dividends paid on preferred stock | -646 | -646 |
Net cash provided by (used in) financing activities - continuing operations | 263 | -2,083 |
Net cash provided by (used in) financing activities - discontinued operations | 0 | 0 |
Net cash provided by (used in) financing activities | 263 | -2,083 |
Net change in cash and cash equivalents | -55 | -2,633 |
Cash and cash equivalents, beginning | 10,735 | 19,374 |
Cash and cash equivalents, ending | 10,680 | 16,741 |
Cash paid during the year for: | ||
Interest | 2,513 | 2,472 |
Supplemental disclosure of non-cash activities: | ||
Conversions of debt and other liabilities to equity | 0 | 2,930 |
2011 Notes surrendered and cancelled in payment for 2014 Notes | 0 | 445 |
Warrants issued in conjunction with convertible debt offering | $0 | $87 |
Significant_Accounting_Policie
Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2015 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | SIGNIFICANT ACCOUNTING POLICIES |
See Note 1 to our Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014, filed with the Securities and Exchange Commission (the "SEC") on March 31, 2015 (the "Annual Report"), for a description of all significant accounting policies. | |
Description of Business | |
AdCare Health Systems, Inc. (“AdCare”) and its controlled subsidiaries (collectively with AdCare, the “Company” ) own, operate and manage for third-parties skilled nursing and assisted living facilities in the states of Alabama, Arkansas, Georgia, North Carolina, Ohio, Oklahoma and South Carolina. | |
In July 2014, the Company announced that the Board of Directors had approved a strategic plan to transition the Company to a healthcare property holding and leasing company. Through a series of leasing and subleasing transactions, the Company is in the process of transition to third-parties the operations of the Company’s currently owned and operated healthcare facilities, which are principally skilled nursing facilities. In furtherance of this strategic plan, the Company is now focused on the ownership, acquisition and leasing of healthcare related properties. | |
As of March 31, 2015, the Company operated or managed 31 facilities comprised of 28 skilled nursing facilities, two assisted living facilities and one independent living/senior housing facility totaling approximately 3,300 beds. The Company’s facilities provide a range of health care services to their patients and residents including skilled nursing and assisted living services, social services, various therapy services, and other rehabilitative and healthcare services for both long-term residents and short-stay patients. As of March 31, 2015, of the total 31 facilities, the Company owned and operated 22 facilities, leased and operated six facilities, and managed three facilities for third-parties. | |
As of March 31, 2015, the Company also leased three owned and subleased five leased skilled nursing and rehabilitation facilities to local third-party operators in the states of Alabama and Georgia. | |
On March 31, 2014, the Company executed a representation agreement to sell Companions Specialized Care Center ("Companions"), a 102-bed skilled nursing facility located in Tulsa, Oklahoma. This facility is reported as discontinued operations (see Note 10 - Discontinued Operations and Note 15 - Subsequent Events). | |
During the three months ended March 31, 2015, the Company entered into certain leasing and operations transfer agreements for facilities located in Arkansas, Georgia, North Carolina, and South Carolina (see Note 7 - Leases for a full description of such leases). | |
Basis of Presentation | |
The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Rule 8-03 of Article 8 of Regulations S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. Changes to GAAP are established by the Financial Accounting Standards Board (“FASB”) in the form of Accounting Standards Updates (“ASUs”) to the FASB’s Accounting Standards Codification (“ASC”). In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of the results of operations for the periods presented have been included. Operating results for the three months ended March 31, 2015 and 2014, are not necessarily indicative of the results that may be expected for the fiscal year. The balance sheet at December 31, 2014, has been derived from the audited consolidated financial statements at that date, but does not include all of the information and footnotes required by GAAP for complete financial statements. | |
You should read these consolidated financial statements together with the historical consolidated financial statements of the Company for the year ended December 31, 2014 included in the Annual Report. | |
The Company operates in one business segment. These statements include the accounts of AdCare Health Systems, Inc. and its controlled subsidiaries. Controlled subsidiaries include AdCare’s majority owned subsidiaries and one variable interest entity (a "VIE") in which AdCare has control as primary beneficiary. All inter-company accounts and transactions were eliminated in the consolidation. | |
Use of Estimates | |
The preparation of consolidated financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported results of operations during the reporting period. Examples of significant estimates include allowance for doubtful accounts, contractual allowances for Medicaid, Medicare, and managed care reimbursements, deferred tax valuation allowance, fair value of derivative instruments, fair value of employee and nonemployee stock based awards, and valuation of goodwill and other long-lived assets. Actual results could differ materially from those estimates. | |
Reclassifications | |
Certain items previously reported in the consolidated financial statement captions have been reclassified to conform to the current financial statement presentation with no effect on the Company’s consolidated financial position or results of operations. These reclassifications did not affect total assets, total liabilities, or stockholders’ equity. Reclassifications were made to the Consolidated Statements of Operations for the three months ended March 31, 2014 to reflect the same facilities in discontinued operations for both periods presented. | |
Revenue Recognition and Patient Care Receivables | |
The Company recognizes revenue when the following four conditions have been met: (i) there is persuasive evidence that an arrangement exists; (ii) delivery has occurred or service has been rendered; (iii) the price is fixed or determinable; and (iv) collection is reasonably assured. The Company's revenue is derived primarily from providing healthcare services to residents and is recognized on the date services are provided at amounts billable to the individual. For reimbursement arrangements with third-party payors, including Medicaid, Medicare and private insurers, revenue is recorded based on contractually agreed-upon amounts on a per patient, daily basis. | |
Revenue from the Medicaid and Medicare programs accounted for 83.8% of the Company’s revenue for the three months ended March 31, 2015, and 84.5% of the Company's revenue for the three months ended March 31, 2014. The Company records revenue from these governmental and managed care programs as services are performed at their expected net realizable amounts under these programs. The Company’s revenue from governmental and managed care programs is subject to audit and retroactive adjustment by governmental and third-party agencies. Consistent with healthcare industry accounting practices, any changes to these governmental revenue estimates are recorded in the period the change or adjustment becomes known. The Company recorded retroactive adjustments to revenue which were not material to the Company's consolidated revenue for the three months ended March 31, 2015 and 2014. | |
Potentially uncollectible patient accounts are provided for on the allowance method based upon management's evaluation of outstanding accounts receivable at period-end and historical experience. Uncollected accounts that are written off are charged against allowance. As of March 31, 2015 and December 31, 2014, the Company has an allowance for uncollectible accounts of $7.7 million and $6.7 million, respectively. | |
Management Fee Revenues and Receivables | |
Management fee revenues and receivables are recorded in the month that services are provided. As of March 31, 2015 and December 31, 2014, the Company evaluated collectibility of management fees and determined that no allowance was required. | |
Rental Revenues and Receivables | |
The Company, as lessor, makes a determination with respect to each of its leases whether they should be accounted for as operating leases. The Company recognizes rental revenues on a straight-line basis over the term of the lease when collectibility is reasonably assured. Differences between rental income earned and amounts due under the lease are charged or credited, as applicable, to straight-line rent receivable, net. Payments received under operating leases are accounted for in the statements of operations as rental revenue for actual rent collected plus or minus a straight-line adjustment for estimated minimum lease escalators. As of March 31, 2015 and 2014, the Company evaluated collectibility of rental revenue and determined that no allowance was required. | |
Fair Value Measurements and Financial Instruments | |
Accounting guidance establishes a three-level valuation hierarchy for disclosure of fair value measurements. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels are defined as follows: | |
Level 1— Quoted market prices in active markets for identical assets or liabilities | |
Level 2— Other observable market-based inputs or unobservable inputs that are corroborated by market data | |
Level 3— Significant unobservable inputs | |
The respective carrying value of certain financial instruments of the Company approximates their fair value. These instruments include cash and cash equivalents, restricted cash and investments, accounts receivable, notes receivable, notes payable and other debt, and accounts payable. Fair values were assumed to approximate carrying values for these financial instruments because they are short-term in nature and their carrying amounts approximate fair values, they are receivable or payable on demand, or the interest rates earned and/or paid approximate current market rates. | |
Recent Accounting Pronouncements | |
Except for rules and interpretive releases of the SEC under authority of federal securities laws and a limited number of grandfathered standards, the FASB ASC is the sole source of authoritative GAAP literature recognized by the FASB and applicable to the Company. The Company has reviewed the FASB accounting pronouncements and ASU interpretations that have effectiveness dates during the periods reported and in future periods. | |
In April 2014, the FASB issued ASU 2014-08 that amends the definition of a discontinued operation to include only those disposals of components of an entity that represent a strategic shift that has (or will have) a major effect on an entity’s operations and financial results. This ASU should be applied prospectively and is effective for the Company for the 2015 annual and interim periods. Early adoption is permitted for disposals that have not been reported in financial statements previously issued. The Company has adopted this ASU as of March 31, 2015. | |
In May 2014, the FASB issued ASU 2014-09 guidance requiring revenue to be recognized in an amount that reflects the consideration expected to be received in exchange for those goods and services. The guidance requires the disclosure of sufficient quantitative and qualitative information for financial statement users to understand the nature, amount, timing and uncertainty of revenue and associated cash flows arising from contracts with customers. The guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period, with early adoption precluded. The Company has not yet determined the impact, if any, that the adoption of this guidance will have on its consolidated financial position or results of operations. | |
In August 2014, the FASB issued ASU 2014-15 guidance regarding an entity’s ability to continue as a going concern, which requires management to assess a company’s ability to continue as a going concern and to provide related footnote disclosures in certain circumstances. Before this new standard, there was minimal guidance in GAAP specific to going concern. Under the new standard, disclosures are required when conditions give rise to substantial doubt about a company’s ability to continue as a going concern within one year from the financial statement issuance date. The guidance is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period, with early adoption permitted. The Company has not yet determined the impact, if any, that the adoption of this guidance will have on its consolidated financial statements. | |
In April 2015, the FASB issued ASU 2015-03 guidance regarding debt issuance costs as a part of the simplification and productivity initiative. Under this guidance, debt issuance costs will be presented as a direct reduction from the carrying amount of the debt liability, consistent with the presentation of debt discounts. The amortization of debt issuance costs will be reported as interest expense. The new guidance is to be applied on a retrospective basis and reported as a change in an accounting principle. This guidance is effective for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period. Early adoption is permitted for financial statements that have not been previously issued. The Company is currently evaluating changes in its accounting required by this new guidance and the impact to the Company's financial position, results of operations and related disclosures. |
Earnings_Per_Share
Earnings Per Share | 3 Months Ended | ||||||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||
EARNINGS PER SHARE | EARNINGS PER SHARE | ||||||||||||||||||||||
Basic earnings per share is computed by dividing net income or loss by the weighted-average number of shares of common stock outstanding during the period. Diluted earnings per share is similar to basic earnings per share except net income or loss is adjusted for potentially dilutive securities, such as options, warrants, non-vested shares, and additional shares issuable under subordinated convertible promissory notes outstanding during the period when such potentially dilutive securities are not anti-dilutive. Potentially dilutive securities from options, warrants and unvested restricted shares are calculated in accordance with the treasury stock method. Potentially dilutive securities from subordinated convertible promissory notes are calculated based on the assumed issuance at the beginning of the period, as well as any adjustment to income that would result from their assumed issuance. For the three months ended March 31, 2015 and 2014, potentially dilutive securities of 7.0 million and 9.1 million, respectively, were excluded from the diluted income (loss) per share calculation because including them would have been anti-dilutive in both periods. | |||||||||||||||||||||||
The following tables provide a reconciliation of net income (loss) for continuing and discontinued operations and the number of shares of common stock used in the computation of both basic and diluted earnings per share: | |||||||||||||||||||||||
Three Months Ended March 31, | |||||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||||
(Amounts in 000’s, except per share data) | Income | Shares | Per | Income | Shares | Per | |||||||||||||||||
(loss) | Share | (loss) | Share | ||||||||||||||||||||
Continuing Operations: | |||||||||||||||||||||||
Loss from continuing operations | $ | (3,842 | ) | $ | (2,598 | ) | |||||||||||||||||
Net loss attributable to noncontrolling interests | 230 | 173 | |||||||||||||||||||||
Basic loss from continuing operations | $ | (3,612 | ) | 19,218 | $ | (0.19 | ) | $ | (2,425 | ) | 16,916 | $ | (0.14 | ) | |||||||||
Preferred stock dividend | (646 | ) | 19,218 | $ | (0.03 | ) | (646 | ) | 16,916 | $ | (0.04 | ) | |||||||||||
Effect of dilutive securities: Stock options, warrants outstanding and subordinated convertible promissory notes (a) | |||||||||||||||||||||||
Diluted loss from continuing operations | $ | (4,258 | ) | 19,218 | $ | (0.22 | ) | $ | (3,071 | ) | 16,916 | $ | (0.18 | ) | |||||||||
Discontinued Operations: | |||||||||||||||||||||||
Basic income (loss) from discontinued operations | (1,407 | ) | 19,218 | $ | (0.07 | ) | 75 | 16,916 | $ | — | |||||||||||||
Diluted income (loss) from discontinued operations | (1,407 | ) | 19,218 | $ | (0.07 | ) | 75 | 16,916 | $ | — | |||||||||||||
Net Loss Attributable to AdCare: | |||||||||||||||||||||||
Basic loss | (5,665 | ) | 19,218 | $ | (0.29 | ) | (2,996 | ) | 16,916 | $ | (0.18 | ) | |||||||||||
Diluted loss | (5,665 | ) | 19,218 | $ | (0.29 | ) | (2,996 | ) | 16,916 | $ | (0.18 | ) | |||||||||||
(a) Securities outstanding that were excluded from the computation, prior to the use of the treasury stock method, because they would have been anti-dilutive are as follows: | |||||||||||||||||||||||
March 31, | |||||||||||||||||||||||
(Amounts in 000’s) | 2015 | 2014 | |||||||||||||||||||||
Outstanding Stock Options | 894 | 1,758 | |||||||||||||||||||||
Outstanding Warrants - employee | 587 | 1,876 | |||||||||||||||||||||
Outstanding Warrants - nonemployee | 1,679 | 1,019 | |||||||||||||||||||||
Subordinated Convertible Promissory Notes | 3,804 | 4,406 | |||||||||||||||||||||
Total anti-dilutive securities | 6,964 | 9,059 | |||||||||||||||||||||
Liquidity_and_Profitability
Liquidity and Profitability | 3 Months Ended |
Mar. 31, 2015 | |
LIQUIDITY AND PROFITABILITY | |
LIQUIDITY AND PROFITABILITY | LIQUIDITY AND PROFITABILITY |
Sources of Liquidity | |
At March 31, 2015, the Company had $10.7 million in cash and cash equivalents as well as restricted cash and investments of $8.1 million. Over the next 12 months, the Company anticipates both access to and receipt of several sources of liquidity. | |
At March 31, 2015, the Company had one facility, three office buildings and one variable interest entity held for sale that the Company anticipates selling in 2015. The Company expects that the cash proceeds and the release of restricted cash on the sale of the variable interest entity and the sale of the one facility will approximate the related obligations. The Company expects that the cash proceeds from the sale of the office buildings will exceed related obligations by approximately $0.6 million. | |
The Company routinely has ongoing discussions with existing and potential new lenders to refinance current debt on a longer term basis and, in recent periods, has refinanced shorter term acquisition debt, including seller notes, with traditional longer term mortgage notes, some of which have been executed under government guaranteed lending programs. | |
During the remainder of 2015, the Company anticipates net proceeds of approximately $2.7 million on refinancing of existing debt, primarily in the second and third quarters of 2015. Further, the Company estimates cash flow from operations and other working capital changes of approximately $1.5 million for the year ending December 31, 2015. | |
The Company maintains certain revolving lines of credit for which the Company has limited remaining capacity and all of which are due and expected to be repaid in 2015. Given the Company's ongoing transition out of healthcare operations, the Company does not anticipate any additional draws on these facilities. | |
On March 31, 2015, the Company entered into subscription agreements with certain accredited investors pursuant to which the Company accepted subscriptions for an aggregate of $8.5 million in principal amount of the Company’s 10% Convertible Subordinated Notes Due April 30, 2017 (the "2015 Notes"). In connection therewith, the Company received net cash proceeds for working capital of approximately $1.7 million on March 31, 2015, and approximately $6.0 million on April 30, 2015 (see Note 9 – Notes Payable and Other Debt and Note 15 - Subsequent Events). | |
On April 13, 2015, the Company issued and sold 575,000 shares of its Series A Cumulative Redeemable Preferred Stock (the "Series A Preferred Stock") at a public offering price of $25.75 per share in a "best-efforts" underwritten registered public offering. In connection therewith, the Company received net cash proceeds of approximately $13.5 million (see Note 15 – Subsequent Events). | |
Other liquidity sources include to a lesser extent, the proceeds from the exercise of options and warrants. | |
Cash Requirements | |
At March 31, 2015, the Company had $151.8 million in indebtedness of which the current portion is $29.7 million. This current portion is comprised of the following components: (i) convertible debt of approximately $8.3 million; (ii) debt of held for sale entities of approximately $12.1 million, primarily senior debt - bond and mortgage indebtedness; and (iii) remaining debt of approximately $9.3 million which includes revolver debt, senior debt - bonds, and senior debt - mortgage indebtedness (for a complete debt listing and credit facility detail, see Note 9 - Notes Payable and Other Debt). | |
The convertible debt includes two subordinated convertible debt issuances. One was issued in 2012 (the “2012 Notes”) and has an outstanding principal amount of $7.5 million at March 31, 2015 with maturity on July 31, 2015. At any time on or after the six-month anniversary of the date of issuance of the 2012 Notes, they are convertible at the option of the holder into shares of the Company's common stock at a conversion price equal to $3.97 per share (adjusted for a 5% stock dividend paid on October 22, 2012, and subject to adjustment for stock dividends, stock splits, combination of shares, recapitalization and other similar events). The other was issued in 2014 (the “2014 Notes”) and has an outstanding principal amount of $0.8 million at March 31, 2015 with maturity on April 30, 2015. At any time on or after the date of issuance of the 2014 Notes, they are convertible at the option of the holder into shares of the common stock at an initial conversion price equal to $4.50 per share, subject to adjustment for stock dividends, stock splits, combination of shares, recapitalization and other similar events. | |
On March 31, 2015, the Company entered into subscription agreements with certain accredited investors pursuant to which the Company accepted subscriptions for an aggregate of $8.5 million in principal amount of the 2015 Notes. In connection therewith, the Company issued approximately $1.7 million in principal amount of 2015 Notes on March 31, 2015 and approximately $6.0 million on April 30, 2015 (see Note 15 - Subsequent Events). | |
The current debt maturing in 2015 for all other debt approximates $9.3 million. As indicated previously, the Company routinely has ongoing discussions with existing and potential new lenders to refinance current debt on a longer term basis and, in recent periods, has refinanced shorter term acquisition debt, including seller notes, with traditional longer term mortgage notes, some of which have been executed under government guaranteed lending programs. The Company anticipates net principal disbursements of approximately $6.8 million which reflect the offset of anticipated proceeds on refinancing of approximately $2.5 million. | |
The Company anticipates operating cash requirements in 2015 as being substantially less than in 2014 due to the transition to a healthcare property holding and leasing company. Based on the described sources of liquidity and related cash requirements, the Company expects sufficient funds for its operations, scheduled debt service, and capital expenditures at least through the next 12 months. On a longer term basis, at March 31, 2015, the Company has approximately $67.3 million of debt maturities due over the next two year period ending March 31, 2017, excluding convertible promissory notes which are convertible into shares of the Company's common stock. The Company has been successful in recent years in raising new equity capital and believes, based on recent discussions, that these markets will continue to be available to us for raising capital in 2015 and beyond. The Company believes its long-term liquidity needs will be satisfied by these same sources, as well as borrowings as required to refinance indebtedness. | |
In order to satisfy the Company's capital needs, the Company seeks to: (i) improve operating results through a series of leasing and subleasing transactions with favorable terms and consistent and predictable cash flow; (ii) expand borrowing arrangements with certain lenders; (iii) refinance current debt where possible to obtain more favorable terms; and (iv) raise capital through the issuance of debt or equity securities. The Company anticipates that these actions, if successful, will provide the opportunity to maintain liquidity on a short and long term basis, thereby permitting the Company to meet our operating and financing obligations for the next twelve months. However, there is no guarantee that such actions will be successful or that anticipated operating results or the transition of the Company to primarily a property holding and leasing company will be achieved. The Company currently has limited borrowing availability under our existing revolving credit facilities. |
Restricted_Cash_and_Investment
Restricted Cash and Investments | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Restricted Cash and Investments [Abstract] | |||||||||
RESTRICTED CASH AND INVESTMENTS | RESTRICTED CASH AND INVESTMENTS | ||||||||
The following table sets forth the Company’s various restricted cash, escrow deposits and investments: | |||||||||
(Amounts in 000’s) | 31-Mar-15 | 31-Dec-14 | |||||||
HUD escrow deposits | $ | 321 | $ | 289 | |||||
Lender's collection account | 391 | 35 | |||||||
Current replacement reserves | 133 | 9 | |||||||
HUD current replacement reserves | 637 | 637 | |||||||
Collateral cash and certificates of deposit | 1,758 | 2,302 | |||||||
Property tax escrow | 63 | 49 | |||||||
Total current portion | 3,303 | 3,321 | |||||||
HUD replacement reserves | 1,047 | 1,074 | |||||||
Reserves for capital improvements | 256 | 936 | |||||||
Restricted investments for other debt obligations | 3,466 | 3,446 | |||||||
Total noncurrent portion | 4,769 | 5,456 | |||||||
Total restricted cash and investments | $ | 8,072 | $ | 8,777 | |||||
Intangible_Assets_and_Goodwill
Intangible Assets and Goodwill | 3 Months Ended | ||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||
INTANGIBLE ASSETS AND GOODWILL | INTANGIBLE ASSETS AND GOODWILL | ||||||||||||||||
There have been no impairment adjustments to intangible assets and goodwill during the three months ended March 31, 2015. | |||||||||||||||||
Intangible assets consist of the following: | |||||||||||||||||
(Amounts in 000’s) | Bed Licenses (included in property and equipment) | Bed Licenses - Separable | Lease Rights | Total | |||||||||||||
Balances, December 31, 2014 | |||||||||||||||||
Gross | $ | 36,948 | $ | 2,471 | $ | 8,824 | $ | 48,243 | |||||||||
Accumulated amortization | (3,855 | ) | — | (4,737 | ) | (8,592 | ) | ||||||||||
Net carrying amount | $ | 33,093 | $ | 2,471 | $ | 4,087 | $ | 39,651 | |||||||||
Amortization expense | (308 | ) | — | (167 | ) | (475 | ) | ||||||||||
Balances, March 31, 2015 | |||||||||||||||||
Gross | 36,948 | 2,471 | 8,824 | 48,243 | |||||||||||||
Accumulated amortization | (4,163 | ) | — | (4,904 | ) | (9,067 | ) | ||||||||||
Net carrying amount | $ | 32,785 | $ | 2,471 | $ | 3,920 | $ | 39,176 | |||||||||
Amortization expense for bed licenses included in property and equipment was approximately $0.3 million for the three months ended March 31, 2015 and 2014. Amortization expense for lease rights was approximately $0.2 million for the three months ended March 31, 2015 and 2014. | |||||||||||||||||
Expected amortization expense for all definite lived intangibles for each of the years ended December 31 is as follows: | |||||||||||||||||
(Amounts in 000’s) | Bed Licenses | Lease Rights | |||||||||||||||
2015(a) | $ | 924 | $ | 500 | |||||||||||||
2016 | 1,232 | 667 | |||||||||||||||
2017 | 1,232 | 667 | |||||||||||||||
2018 | 1,232 | 667 | |||||||||||||||
2019 | 1,232 | 667 | |||||||||||||||
Thereafter | 26,933 | 752 | |||||||||||||||
Total expected amortization expense | $ | 32,785 | $ | 3,920 | |||||||||||||
(a) Estimated amortization expense for the year ending December 31, 2015 includes only amortization to be recorded after March 31, 2015. | |||||||||||||||||
The following table summarizes the carrying amount of goodwill: | |||||||||||||||||
(Amounts in 000’s) | 31-Mar-15 | 31-Dec-14 | |||||||||||||||
Goodwill | $ | 5,023 | $ | 5,023 | |||||||||||||
Accumulated impairment losses | (799 | ) | (799 | ) | |||||||||||||
Total | $ | 4,224 | $ | 4,224 | |||||||||||||
The Company does not amortize goodwill or indefinite lived intangibles, which consist of separable bed licenses. |
Property_and_Equipment
Property and Equipment | 3 Months Ended | ||||||||||
Mar. 31, 2015 | |||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||
PROPERTY AND EQUIPMENT | PROPERTY AND EQUIPMENT | ||||||||||
The following table sets forth the Company’s property and equipment: | |||||||||||
(Amounts in 000’s) | Estimated Useful | 31-Mar-15 | 31-Dec-14 | ||||||||
Lives (Years) | |||||||||||
Buildings and improvements | May-40 | $ | 131,452 | $ | 132,842 | ||||||
Equipment | 10-Feb | 13,427 | 13,616 | ||||||||
Land | — | 7,432 | 7,437 | ||||||||
Computer related | 10-Feb | 2,921 | 2,913 | ||||||||
Construction in process | — | 46 | 52 | ||||||||
155,278 | 156,860 | ||||||||||
Less: accumulated depreciation and amortization expense | 22,284 | 21,275 | |||||||||
Property and equipment, net | $ | 132,994 | $ | 135,585 | |||||||
Depreciation and amortization expense was approximately $1.7 million and $1.8 million for the three months ended March 31, 2015 and 2014, respectively. Total depreciation and amortization expense excludes $0.02 million and $0.2 million for the three months ended March 31, 2015 and 2014, respectively, that is recognized in loss from discontinued operations, net of tax. | |||||||||||
There were no impairment charges recorded for the three months ended March 31, 2015. |
Leases_Notes
Leases (Notes) | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Leases [Abstract] | |||||
Leases | LEASES | ||||
Operating Leases | |||||
The Company leases certain office space and a total of eleven skilled nursing facilities under non-cancelable operating leases, most of which have initial lease terms of ten to twelve years with rent escalation clauses and provisions for payments by the Company of real estate taxes, insurance and maintenance costs; six of the skilled nursing facilities that are leased are operated by the Company. For the three months ended March 31, 2015 and 2014, facility rent expense totaled $1.9 million and $1.7 million, respectively. Total facility rent expense excludes $0.4 million for the three months ended March 31, 2014 that is recognized in Loss from Discontinued Operations, net of tax. | |||||
Eight of the Company's skilled nursing facilities are operated under a single master indivisible lease arrangement, dated August 1, 2010, with William M. Foster as landlord (the "Prime Lease"). The lease has a term of ten years into 2020. Under the Prime Lease, a breach at a single facility could subject one or more of the other facilities covered by the same master lease to the same default risk. Failure to comply with regulations or governmental authorities, such as Medicaid and Medicare provider requirements, is a default under the Prime Lease. In addition, other potential defaults related to an individual facility may cause a default of the entire Prime Lease. With an indivisible lease, it is difficult to restructure the composition of the portfolio or economic terms of the lease without the consent of the landlord. The Company is not aware of any defaults and believes it is in compliance with the covenants of the Prime Lease as of March 31, 2015. | |||||
Two of the Company's facilities are operated under a single indivisible lease; therefore, a breach at a single facility could subject the second facility to the same default risk. The lease has an initial term of twelve years into 2022 and two optional ten-year renewal terms, and includes covenants and restrictions. The Company is required to make minimum capital expenditures of $375 per licensed bed per lease year at each facility which amounts to $0.1 million per year for both facilities. As of March 31, 2015, the Company is in compliance with all financial and administrative covenants of this lease agreement. | |||||
Future minimum lease payments for each of the next five years ending December 31, are as follows: | |||||
(Amounts in | |||||
000's) | |||||
2015(a) | $ | 5,113 | |||
2016 | 6,688 | ||||
2017 | 6,593 | ||||
2018 | 6,539 | ||||
2019 | 6,060 | ||||
Thereafter | 6,637 | ||||
Total | $ | 37,630 | |||
(a) Estimated minimum lease payments for the year ending December 31, 2015 include only payments to be recorded after March 31, 2015. | |||||
The Company has also entered into lease agreements for various equipment used in the facilities. These leases are included in future minimum lease payments above. | |||||
Leased and Subleased Facilities to Third-Party Operators | |||||
In connection with both the Company's strategic plan to transition to a healthcare property holding and leasing company and previous leasing and subleasing opportunities, the operations of eight facilities, three owned by us and five leased to us, have been transferred to third-party skilled nursing facility operators as of March 31, 2015. The lease and sublease agreements provide current and future rental revenues. These properties are leased and subleased on a triple net basis, meaning that the lessee (i.e., the new third-party operator of the property) is obligated under the lease or sublease, as applicable, for all liabilities of the property in respect to insurance, taxes and facility maintenance, as well as the lease or sublease payments, as applicable. For further details regarding the Company's leased and subleased facilities to third-party operators, see Note 15 - Subsequent Events in this Quarterly Report and Note 7 - Leases included in the Annual Report. | |||||
Arkansas Leases | |||||
On January 16, 2015, ten wholly-owned subsidiaries (each, an “Aria Sublessor”) of the Company entered into separate sublease agreements pursuant to which each Aria Sublessor leased one of ten skilled nursing facilities located in Arkansas, and owned by a subsidiary of AdCare, to an affiliate of Aria Health Group, LLC (each, an "Aria Sublessee"), which subleases were originally scheduled to commence on March 1, 2015, subject to, among other things: (i) such Aria Sublessee’s receipt of all licenses and other approvals from the State of Arkansas to operate such facility; and (ii) approval of the mortgage lender with respect to such facility. Each sublease agreement is structured as triple net lease wherein the Aria Sublessee is responsible for the day-to-day operation, ongoing maintenance, taxes and insurance for the duration of the sublease. | |||||
On April 30, 2015, the Company entered into a Lease Inducement Fee Agreement with Aria Health Consulting, LLC. The Lease Inducement Fee Agreement provides for a one-time payment from the Company to Aria Health Consulting, LLC equal to $2.0 million minus the security deposits and first month's base and special rent for all Aria Sublessees. On April 30, 2015, in connection with the Aria Lease Inducement Fee Agreement, the remaining eight sublease agreements were amended to, among other things, provide that the Aria Sublessees shall, collectively, pay to the Aria Sublessors special rent in the amount of $29,500 per month payable in advance on or before the first day of each month (except for the first special rent payment, which shall be subtracted from the lease inducement fee paid by the Company under the Lease Inducement Fee Agreement). | |||||
On April 30, 2015, two Aria Sublessors entered into separate sublease termination agreements with two Aria Sublessees, pursuant to which each Aria Sublessor and Aria Sublessee mutually agreed to terminate two of the separate sublease agreements previously entered into on January 16, 2015. The remaining eight sublease agreements commenced on May 1, 2015 (see Note 15 - Subsequent Events). In connection with entering into the sublease agreements, each Aria Sublessor and Aria Sublessee also entered into an operations transfer agreement with respect to the applicable facility, each containing customary terms and conditions relating to the transfer of operations of the skilled nursing facilities. | |||||
As a condition to the Aria Sublessees agreement to a commencement date of May 1, 2015, the Company and the Aria Sublessees agreed to assess, in good faith and within thirty (30) days following the commencement date, making a one-time equitable adjustment to base rent equal to the difference between the facilities 2014 professional liability and general liability insurance costs and projected costs for the first lease year of comparable or mutually acceptable insurance as further adjusted by anticipated Medicaid reimbursement rate increases solely from such added costs. Pursuant to each sublease agreement, the initial lease term is ten years with a five-year renewal option. The annual base rent under all of the sublease agreements in the first year is $5.3 million in the aggregate, exclusive of any equitable adjustment, and the annual base rent under each sublease will escalate at 2% each year through the initial term and 3% per year upon renewal. The sublease agreements are cross-defaulted. On February 27, 2015 and March 31, 2015, the sublease agreements with the Aria Sublessees were amended to extend the commencement date of the subleases to April 1, 2015, and May 1, 2015, respectively. | |||||
Georgia Leases | |||||
On January 31, 2015, a wholly-owned subsidiary (“Wellington Sublessor”) of the Company entered into separate sublease agreements pursuant to which Wellington Sublessor leased two skilled nursing facilities located in Georgia, to affiliates of Wellington Health Services, L.L.C (each a "Wellington Sublessee"). Each sublease agreement was subject to, among other things, each Wellington Sublessee's receipt of all licenses and other approvals from the State of Georgia to operate such facility. The subleases commenced on April 1, 2015. The facilities are currently leased by Wellington Sublessor, as tenant, pursuant to the Prime Lease. Each sublease agreement is structured as triple net lease wherein the Wellington Sublessee is responsible for the day-to-day operation, ongoing maintenance, taxes and insurance for the duration of the sublease. The initial term of each sublease agreement will expire on July 31, 2020 coterminous with the Prime Lease. If Wellington Sublessor and landlord agree to extend the term of the Prime Lease, Wellington Sublessee has the right to extend the term of the sublease agreements through the end of the renewal term of the Prime Lease. The annual rent under the two sublease agreements in the first year will be $3.9 million in the aggregate, and the annual rent under each sublease will escalate at 1% each year through the initial term and 2% per year through the renewal term, if any. The sublease agreements are cross-defaulted. In connection with the sublease agreements, the current licensed operators (wholly-owned subsidiaries of Wellington Sublessor) and the Wellington Sublessees also entered into operations transfer agreements with respect to the applicable facility, containing customary terms and conditions relating to the transfer of operations of skilled nursing facilities. | |||||
On February 18, 2015, a wholly-owned subsidiary (“College Park Sublessor”) of the Company entered into separate sublease agreements pursuant to which College Park Sublessor leased one skilled nursing facility located in Georgia, to affiliates of C.R. of College Park, LLC (the "College Park Sublessee"). The sublease agreement was subject to, among other things, the College Park Sublessee's receipt of all licenses and other approvals from the State of Georgia to operate such facility. The sublease agreement is structured as triple net lease wherein the College Park Sublessee is responsible for the day-to-day operation, ongoing maintenance, taxes and insurance for the duration of the sublease. The initial term of the sublease agreement will expire on April 30, 2020 and has a five year renewal option. The annual rent under the sublease agreement in the first year will approximate $0.6 million annually, and the annual rent will escalate at $12 thousand annually through the lease term. The sublease commenced on April 1, 2015 (see Note 15 - Subsequent Events). In connection with the sublease agreements, the current licensed operator (wholly-owned subsidiary of College Park Sublessor) and the College Park Sublessee also entered into an operations transfer agreement with respect to the applicable facility, containing customary terms and conditions relating to the transfer of operations of skilled nursing facilities. | |||||
On February 18, 2015, a wholly-owned subsidiary (“Autumn Breeze Sublessor”) of the Company entered into a sublease agreement pursuant to which Sublessor will lease one skilled nursing facility located in Georgia, to affiliates of C.R. of Autumn Breeze, LLC (the "Autumn Breeze Sublessee"). The sublease agreement is subject to, among other things, the Autumn Breeze Sublessee's receipt of all licenses and other approvals from the State of Georgia to operate such facility. The sublease agreement is structured as triple net lease wherein the Autumn Breeze Sublessee is responsible for the day-to-day operation, ongoing maintenance, taxes and insurance for the duration of the sublease. The initial term of the sublease agreement will expire on April 30, 2020 and has a five year renewal option. The annual rent under the sublease agreement in the first year will approximate $0.8 million annually, and the annual rent will escalate at $12 thousand annually through the initial lease term. In connection with the sublease agreements, the current licensed operator (wholly-owned subsidiary of Autumn Breeze Sublessor) and the Autumn Breeze Sublessee also entered into an operations transfer agreement with respect to the applicable facility, containing customary terms and conditions relating to the transfer of operations of skilled nursing facilities. | |||||
On March 17, 2015, a wholly-owned subsidiary (“LaGrange Sublessor”) of the Company entered into a sublease agreement pursuant to which LaGrange Sublessor leased one skilled nursing facility located in Georgia, to affiliates of C.R. of LaGrange, LLC (the "LaGrange Sublessee") The sublease agreement was subject to, among other things, the LaGrange Sublessee's receipt of all licenses and other approvals from the State of Georgia to operate such facility. The sublease commenced on April 1, 2015 (see Note 15 - Subsequent Events). The facilities are currently leased by LaGrange Sublessor, as tenant, pursuant to the Prime Lease. The sublease agreement is structured as triple net lease wherein the LaGrange Sublessee is responsible for the day-to-day operation, ongoing maintenance, taxes and insurance for the duration of the sublease. The initial term of the sublease agreement will expire on July 31, 2020 coterminous with the Prime Lease. If LaGrange Sublessor and landlord agree to extend the term of the Prime Lease, LaGrange Sublessee has the right to extend the term of the sublease agreements through the end of the renewal term of the Prime Lease. The annual rent under the sublease agreement in the first two years will approximate $1.0 million annually, and the annual rent will escalate at 3.0% annually through the lease term. In connection with the sublease agreements, the current licensed operators (wholly-owned subsidiaries of LaGrange Sublessor) and the LaGrange Sublessee also entered into an operations transfer agreement with respect to the applicable facility, containing customary terms and conditions relating to the transfer of operations of skilled nursing facilities. | |||||
North Carolina and South Carolina Leases | |||||
On February 27, 2015, three wholly-owned subsidiaries (each, a “Symmetry Healthcare Sublessor”) of the Company entered into separate sublease agreements pursuant to which each Symmetry Healthcare Sublessor leased one skilled nursing facility located in North Carolina and two skilled nursing facilities located in South Carolina, respectively, to a wholly-owned subsidiary of Symmetry Healthcare Management (each, a "Symmetry Healthcare Sublessee"). The sublease agreements were subject to, among other things: (i) such Symmetry Healthcare Sublessee’s receipt of all licenses and other approvals from the states of North Carolina and South Carolina to operate such facilities, respectively; and (ii) approval of the mortgage lender with respect to such facility. Each sublease agreement is structured as triple net lease wherein the Symmetry Healthcare Sublessee is responsible for the day-to-day operation, ongoing maintenance, taxes and insurance for the duration of the sublease. Pursuant to each sublease agreement, the initial lease term is fifteen years with a five-year renewal option. The annual rent under all of the sublease agreements in the first year will be $1.8 million in the aggregate, and the annual rent under each sublease will escalate at 3% each year through the initial term and upon renewal. The sublease agreements are cross-defaulted. In connection with entering into the sublease agreements, each Symmetry Healthcare Sublessor and Symmetry Healthcare Sublessee also entered into an operations transfer agreement with respect to the applicable North Carolina and South Carolina facilities, each containing customary terms and conditions. | |||||
On March 20, 2015, each Symmetry Healthcare Sublessor entered into a separate First Amendment to the Lease Agreement, which amended each of the separate sublease agreements to, among other things: (i) extended the commencement date of the sublease agreement for the skilled nursing facility located in North Carolina (the "Related Lease") to June 1, 2015; and (ii) included a 20% monthly base rent and asset management and professional services fee escalation provision for each of the two skilled nursing facilities located in South Carolina that will take immediate effect if the Related Lease does not commence by June 1, 2015. The base rent and asset management and professional services fee will continue at the increased rate until the commencement of the Related Lease. | |||||
The subleases for the two South Carolina skilled nursing facilities commenced on April 1, 2015. |
Accrued_Expenses
Accrued Expenses | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Payables and Accruals [Abstract] | |||||||||
ACCRUED EXPENSES | ACCRUED EXPENSES | ||||||||
Accrued expenses consist of the following: | |||||||||
(Amounts in 000’s) | 31-Mar-15 | 31-Dec-14 | |||||||
Accrued payroll related | $ | 6,521 | $ | 6,915 | |||||
Accrued employee benefits | 3,987 | 3,405 | |||||||
Real estate and other taxes | 1,613 | 1,335 | |||||||
Other accrued expenses | 5,353 | 3,998 | |||||||
Total accrued expenses | $ | 17,474 | $ | 15,653 | |||||
Notes_Payable_and_Other_Debt
Notes Payable and Other Debt | 3 Months Ended | ||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||
NOTES PAYABLE AND OTHER DEBT | NOTES PAYABLE AND OTHER DEBT | ||||||||||||||||||
Notes payable and other debt consist of the following: | |||||||||||||||||||
(Amounts in 000’s) | 31-Mar-15 | 31-Dec-14 | |||||||||||||||||
Revolving credit facilities and lines of credit | $ | 5,070 | $ | 6,832 | |||||||||||||||
Senior debt - guaranteed by HUD | 25,883 | 26,022 | |||||||||||||||||
Senior debt - guaranteed by USDA | 26,964 | 27,128 | |||||||||||||||||
Senior debt - guaranteed by SBA | 3,665 | 3,703 | |||||||||||||||||
Senior debt - bonds, net of discount (a) | 12,972 | 12,967 | |||||||||||||||||
Senior debt - other mortgage indebtedness (b) | 60,365 | 60,277 | |||||||||||||||||
Other debt | 1,167 | 430 | |||||||||||||||||
Convertible debt issued in 2012 | 7,500 | 7,500 | |||||||||||||||||
Convertible debt issued in 2014 | 849 | 6,500 | |||||||||||||||||
Convertible debt issued in 2015 | 7,336 | — | |||||||||||||||||
Total | $ | 151,771 | $ | 151,359 | |||||||||||||||
Less: current portion | 17,602 | 22,113 | |||||||||||||||||
Less: portion included in liabilities of disposal group held for sale (b) | 6,180 | 5,197 | |||||||||||||||||
Less: portion included in liabilities of variable interest entity held for sale (a) | 5,958 | 5,956 | |||||||||||||||||
Notes payable and other debt, net of current portion | $ | 122,031 | $ | 118,093 | |||||||||||||||
(a) The senior debt - bonds, net of discount includes $6.0 million at both March 31, 2015 and December 31, 2014 related to the Company's consolidated variable interest entity, Riverchase Village ADK, LLC ("Riverchase"), revenue bonds, in two series, issued by the Medical Clinical Board of the City of Hoover in the State of Alabama, which the Company has guaranteed the obligation under such bonds. | |||||||||||||||||||
(b) The senior debt - other mortgage indebtedness includes $5.0 million related to the outstanding loan entered into in conjunction with the acquisition of Companions in August 2012. | |||||||||||||||||||
Scheduled Maturities | |||||||||||||||||||
The schedule below summarizes the scheduled maturities for the twelve months ended March 31 of the respective year. The 2016 maturities include outstanding loans of $5.2 million related to the Companions facility and $1.0 million related to one of the two Hembree Road office buildings which are classified as liabilities of a disposal group held for sale and $6.0 million related to the Riverchase bonds classified as liabilities of a variable interest entity held for sale at March 31, 2015. | |||||||||||||||||||
(Amounts in 000’s) | |||||||||||||||||||
2016 | $ | 29,912 | |||||||||||||||||
2017 | 50,287 | ||||||||||||||||||
2018 | 11,263 | ||||||||||||||||||
2019 | 1,778 | ||||||||||||||||||
2020 | 1,866 | ||||||||||||||||||
Thereafter | 57,053 | ||||||||||||||||||
Subtotal | 152,159 | ||||||||||||||||||
Less: unamortized discounts ($172 classified as current) | (388 | ) | |||||||||||||||||
Total notes and other debt | $ | 151,771 | |||||||||||||||||
Debt Covenant Compliance | |||||||||||||||||||
As of March 31, 2015, the Company (including its consolidated variable interest entity) has approximately 46 credit related instruments (credit facilities, mortgage notes, bonds and other credit obligations) outstanding that include various financial and administrative covenant requirements. Covenant requirements include, but are not limited to, fixed charge coverage ratios, debt service coverage ratios, minimum EBITDA or EBITDAR, current ratios and tangible net worth requirements. Certain financial covenant requirements are based on consolidated financial measurements whereas others are based on measurements at the subsidiary level (i.e., facility, multiple facilities or a combination of subsidiaries comprising less than the Company’s consolidated financial measurements). Some covenants are based on annual financial metric measurements whereas others are based on quarterly financial metric measurements. The Company routinely tracks and monitors its compliance with its covenant requirements. In recent periods, including as of March 31, 2015, the Company has not been in compliance with certain financial covenants. For each instance of such non-compliance, the Company has obtained waivers or amendments to such requirements including, as necessary, modifications to future covenant requirements or the elimination of certain requirements in future periods. | |||||||||||||||||||
The table below indicates which of the Company's credit-related instruments are out of compliance as of March 31, 2015: | |||||||||||||||||||
Credit Facility | Balance at | Financial Covenant | Min/Max | Financial | Future | ||||||||||||||
31-Mar-15 | Financial | Covenant | Financial | ||||||||||||||||
(000's) | Covenant | Metric | Covenant | ||||||||||||||||
Required | Achieved | Metric | |||||||||||||||||
Required (a) | |||||||||||||||||||
Gemino Lines of Credit | $ | 2,274 | Fixed Charge Coverage Ratio (FCCR) | 0.8 | 0.58 | 1.1 | |||||||||||||
PrivateBank - Line of Credit | $ | 1,550 | Coverage of Rent and Debt Service | 1.25 | 0.65 | 1.25 | |||||||||||||
Minimum TTM Fixed Charge Coverage | 1.05 | 0.93 | 1.05 | ||||||||||||||||
Contemporary Healthcare Capital - Term Note and Line of Credit - CSCC Nursing, LLC | $ | 197 | Minimum Implied Current Ratio | 1 | 0.95 | 1 | |||||||||||||
$ | 5,000 | DSCR | 1.15 | (0.76 | ) | 1.15 | |||||||||||||
Minimum Occupancy | 70 | % | 64 | % | 70 | % | |||||||||||||
PrivateBank - Mortgage Note - Valley River Nursing, LLC; Park Heritage Nursing, LLC; Benton Nursing, LLC | $ | 10,946 | Minimum EBITDAR (000s) | $ | 450 | $ | 59 | n/a | |||||||||||
Fixed Charge Coverage Ratio (FCCR) | 1.05 | 0.76 | n/a | ||||||||||||||||
PrivateBank - Mortgage Note - APH&R Property Holdings, LLC; Northridge HC&R Property Holdings, LLC; Woodland Hills HC Property Holdings, LLC | $ | 11,982 | Minimum Debt Service Coverage | 1.75 | 0.53 | n/a | |||||||||||||
Minimum Quarterly Rent (000s) | $ | 290 | $ | 177 | n/a | ||||||||||||||
Minimum Operator Fixed Charge Coverage | 1.1 | 0.57 | n/a | ||||||||||||||||
PrivateBank - Mortgage Note - Georgetown HC&R Property Holdings, LLC; Sumter Valley Property Holdings, LLC | $ | 9,285 | Minimum Quarterly Rent (000s) | $ | 235 | $ | 199 | $ | 235 | ||||||||||
PrivateBank - Mortgage Note - Little Rock HC&R Nursing, LLC | $ | 11,570 | Minimum EBITDAR (000s) | $ | 358 | $ | 42 | n/a | |||||||||||
Operator's Minimum Fixed Charge Coverage | 1.05 | 0.87 | n/a | ||||||||||||||||
(a) Items marked as "n/a" reflect metric requirements which will be revised or eliminated in subsequent testing periods given that operation transfers have occurred subsequent to the period end. | |||||||||||||||||||
The covenants above are all based on a subsidiary level covenant requirement except the Gemino Lines of Credit which is on a consolidated basis. The measurement period for each is on a quarterly basis. | |||||||||||||||||||
Revolving Credit Facilities and Lines of Credit | |||||||||||||||||||
Gemino-Northwest Credit Facility | |||||||||||||||||||
On May 30, 2013, NW 61st Nursing, LLC (“Northwest”), a wholly-owned subsidiary of the Company, entered into a Credit Agreement (the “Northwest Credit Facility”) with Gemino Healthcare Finance, LLC ("Gemino"). The Northwest Credit Facility provided for a $1.0 million principal amount senior-secured revolving credit facility. | |||||||||||||||||||
The Northwest Credit Facility matured on January 31, 2015. Interest accrued on the principal balance thereof at an annual rate of 4.75% plus the current LIBOR rate. Northwest also paid to Gemino: (i) a collateral monitoring fee equal to 1.0% per annum of the daily outstanding balance of the Northwest Credit Facility; and (ii) a fee equal to 0.5% per annum of the unused portion of the Northwest Credit Facility. The Northwest Credit Facility is secured by a security interest in the accounts receivable and the collections and proceeds thereof relating to the Company’s skilled nursing facility located in Oklahoma City, Oklahoma known as the Northwest Nursing Center. AdCare has unconditionally guaranteed all amounts owing under the Northwest Credit Facility. | |||||||||||||||||||
On January 30, 2015 and March 25, 2015, Northwest and Gemino amended the Northwest Credit Facility to extend its terms to March 31, 2015 and to April 30, 2015, respectively. | |||||||||||||||||||
As of March 31, 2015, $1.0 million was outstanding of the maximum borrowing amount of $1.5 million under the Northwest Credit Facility. At March 31, 2015, the Company was not in compliance with covenants contained in the Northwest Credit Facility and has obtained a waiver from Gemino. | |||||||||||||||||||
On April 30, 2015, the outstanding principal amount of $1.0 million under the Northwest Credit Facility was repaid in full, thus releasing all liens and security interests as well as terminating all indebtedness on the Northwest Credit Facility. | |||||||||||||||||||
Gemino-Bonterra Credit Facility | |||||||||||||||||||
On September 20, 2012, ADK Bonterra/Parkview, LLC, a wholly owned subsidiary of the Company ("Bonterra") entered into a Second Amendment to the Credit Agreement with Gemino, which amended the original Credit Agreement dated April 27, 2011 between Bonterra and Gemino ("Gemino-Bonterra Credit Facility"). The Gemino-Bonterra Credit Facility is a secured credit facility for borrowings up to $2.0 million. The amendment extended the term of the Gemino-Bonterra Credit Facility from October 29, 2013 to January 31, 2014 and amended certain financial covenants regarding Bonterra's fixed charge coverage ratio, maximum loan turn days and applicable margin. Interest accrues on the principal balance outstanding at an annual rate equal to the LIBOR rate plus the applicable margin of 4.75% to 5.00%, which fluctuates depending upon the principal amount outstanding. | |||||||||||||||||||
On May 30, 2013, Bonterra, entered into a Fourth Amendment to Credit Agreement with Gemino, which among other things: (i) extends the term of the Gemino-Bonterra Credit Facility from January 31, 2014 to January 31, 2015; (ii) amended certain financial covenants regarding Bonterra’s fixed charge coverage ratio and maximum loan turn days; and (iii) amended the Gemino-Bonterra Credit Facility to include the Northwest Credit Facility as an affiliated credit agreement in determining whether certain financial covenants are being met. | |||||||||||||||||||
On January 30, 2015 and March 31, 2015, Bonterra and Gemino amended the Gemino-Bonterra Credit Facility to extend its term to March 31, 2015 and to April 30, 2015, respectively. | |||||||||||||||||||
As of March 31, 2015, $1.3 million was outstanding of the maximum borrowing amount of $2.0 million under the Gemino-Bonterra Credit Facility. At March 31, 2015, the Company was not in compliance with covenants contained in the Gemino-Bonterra Credit Facility and has obtained a waiver from Gemino. | |||||||||||||||||||
On May 1, 2015, Bonterra and Gemino amended the Gemino-Bonterra Credit Facility to extend its term from April 30, 2015 to June 30, 2015. | |||||||||||||||||||
Georgetown and Sumter Credit Facility | |||||||||||||||||||
On January 30, 2015, two wholly-owned subsidiaries of the Company entered into a Loan Agreement (the "Georgetown and Sumter Credit Facility"), between the Company and The PrivateBank and Trust Company ("PrivateBank"). The Georgetown and Sumter Credit Facility provides for a $9.3 million principal amount secured credit facility. The facility is secured by real property. | |||||||||||||||||||
The Georgetown and Sumter Credit Facility matures on September 1, 2016. Interest on the Georgetown and Sumter Credit Facility accrues on the principal balance thereof at the LIBOR rate plus 4.25%. Interest payments on the loan are due and payable monthly, beginning on March 1, 2015. The Georgetown and Sumter Credit Facility is secured by, among other things, an assignment of all rents paid under any existing or future leases and rental agreements with respect to the Georgetown and Sumter Credit Facility. | |||||||||||||||||||
AdCare has unconditionally guaranteed all amounts owing under the Georgetown and Sumter Credit Facility. On January 30, 2015, proceeds from the Georgetown and Sumter Credit Facility were used to pay off all amounts outstanding under a separate $9.0 million credit facility with Metro City Bank under which certain subsidiaries of the Company were borrowers. | |||||||||||||||||||
At March 31, 2015, the Company was not in compliance with covenants contained in the Georgetown and Sumter Credit Facility and has obtained a waiver from PrivateBank. | |||||||||||||||||||
Northridge, Woodland Hills and Abington Credit Facility | |||||||||||||||||||
On February 25, 2015, three wholly-owned subsidiaries of the Company entered into a Loan Agreement (the "Northridge, Woodland Hills and Abington Credit Facility") with PrivateBank. The PrivateBank Credit Facility provides for a $12.0 million principal amount secured credit facility. This facility is secured by real property. | |||||||||||||||||||
The Northridge, Woodland Hills and Abington Credit Facility matures on September 1, 2016. Interest accrues on the principal balance thereof at the LIBOR rate plus 4.25%. Principal and interest payments on the note are due and payable monthly, beginning on March 1, 2015. The facility is secured by, among other things, an assignment of all rents paid under any existing or future leases and rental agreements with respect to the Northridge, Woodland Hills and Abington Credit Facility. | |||||||||||||||||||
AdCare has unconditionally guaranteed all amounts owing under the Northridge, Woodland Hills and Abington Credit Facility. Proceeds from the Northridge, Woodland Hills and Abington Credit Facility were used to pay off all amounts outstanding under a separate $12.0 million credit facility with KeyBank National Association ("KeyBank") under which certain subsidiaries of the Company were borrowers. | |||||||||||||||||||
As of March 31, 2015, $12.0 million was outstanding of the maximum borrowing amount of $12.0 million under the Northridge, Woodland Hills and Abington Credit Facility. As of March 31, 2015, the Company had $2.0 million of outstanding restricted assets related to this credit facility. At March 31, 2015, the Company was not in compliance with covenants contained in the Northridge, Woodland Hills and Abington Credit Facility and has obtained a waiver from PrivateBank. | |||||||||||||||||||
Senior Debt - Other Mortgage Indebtedness | |||||||||||||||||||
Northridge, Woodland Hills and Abington | |||||||||||||||||||
On December 28, 2012, the Company entered into a Secured Loan Agreement and Payment Guaranty with KeyBank totaling $16.5 million (the "KeyBank Credit Facility"). | |||||||||||||||||||
On March 28, 2014, the Company entered into a Fourth Amendment to the Secured Loan Agreement and Payment Guaranty with KeyBank, which amended the Secured Loan Agreement of the KeyBank Credit Facility. Pursuant to the amendment, among other things: (i) KeyBank waived the failure of certain financial covenants of such subsidiaries regarding fixed charge coverage ratio, implied debt service coverage, and compliance of making a certain sinking fund payment due on March 1, 2014 such that no default or events of default under the KeyBank Credit Facility occurred due to such failure; (ii) modified and amended certain financial covenants regarding the Company’s fixed charge ratio and implied debt service coverage; and (iii) paid down $3.4 million of loan principal from the release of $3.4 million from a certain collateral account. | |||||||||||||||||||
On February 25, 2015, the outstanding principal amount of $12.0 million under the KeyBank Credit Facility was repaid by the proceeds from the Northridge, Woodland Hills and Abington Credit Facility, noted above. | |||||||||||||||||||
Other Debt | |||||||||||||||||||
Insurance Funding | |||||||||||||||||||
In March 2014, the Company obtained financing from First Insurance Funding Corporation and entered into Commercial Insurance Premium Finance Security Agreements for several insurance programs, including general and professional liability, property, casualty, crime, and employment practices liability effective January 1, 2014 which matured on December 31, 2014. The total amount financed was approximately $3.3 million requiring monthly payments of $0.3 million with interest of 2.50%. The remaining outstanding amount owed was repaid in full during January 2015. | |||||||||||||||||||
In March 2015, the Company obtained financing from IPFS Corporation and entered into a Commercial Insurance Premium Finance Security Agreement for several insurance programs, including property, casualty, and crime effective March 1, 2015 and maturing on December 31, 2015. The total amount financed was approximately $0.4 million requiring monthly payments with interest of 3.29% starting April 2015. At March 31, 2015, the outstanding principal and interest was approximately $0.4 million. | |||||||||||||||||||
KeyBank Promissory Notes | |||||||||||||||||||
On February 25, 2015, the Company entered into four separate unsecured Promissory Note Agreements (the "KeyBank Promissory Notes") with KeyBank for an aggregate principal amount of $0.7 million. The indebtedness represents the portion of certain deferred exit fees owed by the Company to KeyBank in connection with the February 2015 repayment of the KeyBank Credit Facility. The KeyBank Promissory Notes mature on August 25, 2016 , at which time the entire principal balance of the non-interest-bearing notes then unpaid shall be due. If, prior to the maturity date, certain refinancing agreements are entered into with KeyBank as lender, affiliate of lender, or by an agency financing originated by KeyBank or any affiliate of KeyBank, then and in such an event the entire remaining principal amount of the KeyBank Promissory Notes shall be forgiven. | |||||||||||||||||||
On April 3, 2015, the Company entered into five separate unsecured Amended and Restated Promissory Note Agreements with KeyBank, which amend the KeyBank Promissory Notes to include a fifth note with the aggregate principal total of $0.7 million remaining unaltered. The amendments restate the principal balances on the original notes in order to include a fifth facility. | |||||||||||||||||||
Convertible Debt | |||||||||||||||||||
Convertible Subordinated Notes Issued in 2015 (the "2015 Notes") | |||||||||||||||||||
On March 31, 2015, the Company entered into Subscription Agreements with certain accredited investors for $8.5 million of the 2015 Notes. In connection therewith, the Company issued approximately $1.7 million in principal amount of 2015 Notes on March 31, 2015 and approximately $6.0 million in principal amount of 2015 Notes on April 30, 2015 (see Note 15 - Subsequent Events). | |||||||||||||||||||
The 2015 Notes are convertible at the option of the holder into shares of common stock at an initial conversion price equal to $4.25 per share. If, prior to September 30, 2015, the Company issues or sells any shares of common stock or common stock equivalents (excluding certain excluded securities, as defined in the 2015 Notes) for a consideration per share (the “New Issuance Price”) less than the conversion price then in effect immediately prior to such issuance or sale, then immediately after such issuance or sale the conversion price then in effect shall be reduced to an amount equal to the New Issuance Price (an “Adjustment for Dilutive Issuances”). Notwithstanding the foregoing, no Adjustment for Dilutive Issuances shall be effected to the extent it would cause the number of shares of common stock issued, plus the number of shares of common stock issuable, in respect of all 2015 Notes in the aggregate to exceed 3,850,405 shares of common stock. In addition, the conversion price will be subject to adjustment for any subdivision (by stock dividend, stock split or similar corporation action) or combination (by reverse stock split or similar corporate action) of the common stock. | |||||||||||||||||||
The Company may prepay at any time, without penalty, upon 60 days prior notice, any portion of the outstanding principal amount and accrued and unpaid interest thereon with respect to any 2015 Note; provided, however, that: (i) the shares of common stock issuable upon conversion of any 2015 Note which is to be so prepaid must be: (a) registered for resale under the Securities Act of 1933, as amended (the "Securities Act"); or (b) otherwise sellable under Rule 144 of the Securities Act without volume limitations thereunder; (ii) at any time after the issue date of such 2015 Note, the volume-weighted average price of the common stock for ten consecutive trading days has equaled or exceeded 125% of the then-current conversion price; and (iii) such prepayment may not be effected prior to March 31, 2016. | |||||||||||||||||||
The holders holding a majority of the outstanding principal amount with respect to all the 2015 Notes may require the Company to redeem all or any portion of the 2015 Notes upon a change of control (as defined in the 2015 Notes) for a redemption price equal to the outstanding principal amount to be redeemed plus all accrued and unpaid interest thereon. In addition, upon a change of control, the Company may redeem all or any portion of the 2015 Notes for a redemption price equal to the outstanding principal amount to be redeemed plus all accrued and unpaid interest thereon. | |||||||||||||||||||
During the existence and continuance of an event of default under a 2015 Note, the outstanding principal amount of such 2015 Note shall incur interest at a rate of 14% per annum, and the holder of such 2015 Note may require the Company to redeem all or any portion of such 2015 Note at a redemption price in cash equal to the outstanding principal amount to be redeemed plus all accrued and unpaid interest thereon. An “event of default,” with respect to a 2015 Note includes: (i) the Company’s failure to pay to the holder of such 2015 Note any amount of principal or interest by the 7th business day following the date when due under such 2015 Note; and (ii) specific events of bankruptcy, insolvency, reorganization or liquidation. | |||||||||||||||||||
On March 31, 2015, the Company also entered into a Registration Rights Agreement with the investors pursuant to which the Company has agreed to file, no later than June 29, 2015, a registration statement with the SEC to register the resale of the shares of common stock issuable upon conversion of the 2015 Notes and to use the Company’s best efforts to cause such registration statement to become effective as soon as practicable after filing. | |||||||||||||||||||
In connection with the offering, Institutional Securities Corporation, the placement agent in the offering, is entitled to receive from the Company a placement agent fee of approximately $0.1 million. Institutional Securities Corporation is affiliated with Doucet Asset Management, LLC, a greater than 5% beneficial owner of the common stock. | |||||||||||||||||||
In the offering, the Company accepted Subscription Agreements from certain related parties (see Note 14 - Related Party Transactions). |
Discontinued_Operations
Discontinued Operations | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Discontinued Operations and Disposal Groups [Abstract] | |||||||||
DISCONTINUED OPERATIONS | DISCONTINUED OPERATIONS | ||||||||
On March 31, 2014, the Company entered into a representation agreement to sell Companions, a 102-bed skilled nursing facility located in Tulsa, Oklahoma. During 2014, the Company recognized a $1.8 million loss on impairment to adjust the net book value of Companions to reflect the fair market value. In April 2015, the Company entered into an asset purchase agreement to sell Companions. The closing of the sale is expected after satisfaction of customary closing conditions (see Note 15 - Subsequent Events). | |||||||||
For the discontinued operations, the patient care revenue, related cost of services, and facility rental expense prior to the commencement of subleasing are classified in the activities below. | |||||||||
The following table summarizes the activity of discontinued operations for the three months ended March 31, 2015 and 2014: | |||||||||
Three Months Ended March 31, | |||||||||
(Amounts in 000’s) | 2015 | 2014 | |||||||
Total revenues from discontinued operations | $ | 718 | $ | 9,421 | |||||
Net gain (loss) from discontinued operations | $ | (1,407 | ) | $ | 75 | ||||
Interest expense, net from discontinued operations | $ | 260 | $ | 261 | |||||
On January 21, 2015, the Company listed for sale its two office buildings located on Hembree Road in Roswell, Georgia as part of its transition to a healthcare property holding and leasing company. The assets and liabilities of the two Hembree Road buildings have been reclassified to assets and liabilities of disposal groups held for sale as of March 31, 2015. | |||||||||
Assets and liabilities of the disposal groups held for sale at March 31, 2015 and December 31, 2014 are as follows: | |||||||||
(Amounts in 000’s) | 31-Mar-15 | 31-Dec-14 | |||||||
Property and equipment, net | $ | 5,187 | $ | 3,777 | |||||
Other assets | 2,044 | 2,036 | |||||||
Assets of disposal groups held for sale | $ | 7,231 | $ | 5,813 | |||||
Notes payable | $ | 5,983 | $ | 5,000 | |||||
Line of credit | 197 | 197 | |||||||
Liabilities of disposal group held for sale | $ | 6,180 | $ | 5,197 | |||||
Assets and liabilities of the variable interest entity held for sale at March 31, 2015 and December 31, 2014 are as follows: | |||||||||
Amounts in (000's) | March 31, 2015 | December 31, 2014 | |||||||
Property and equipment, net | $ | 5,893 | $ | 5,893 | |||||
Other assets | 61 | 31 | |||||||
Assets of variable interest entity held for sale | $ | 5,954 | $ | 5,924 | |||||
Bonds payable | $ | 5,958 | $ | 5,956 | |||||
Liabilities of variable interest entity held for sale | $ | 5,958 | $ | 5,956 | |||||
Stock_Based_Compensation
Stock Based Compensation | 3 Months Ended | ||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||
STOCK BASED COMPENSATION | STOCK BASED COMPENSATION | ||||||||||||||||
For the three months ended March 31, 2015 and 2014, the Company recognized stock-based compensation as follows: | |||||||||||||||||
Three Months Ended March 31, | |||||||||||||||||
(Amounts in 000’s) | 2015 | 2014 | |||||||||||||||
Employee compensation: | |||||||||||||||||
Stock options | $ | 44 | $ | 182 | |||||||||||||
Employee warrants | 33 | 41 | |||||||||||||||
Management restricted stock | 63 | 34 | |||||||||||||||
Total employee stock-based compensation expense | $ | 140 | $ | 257 | |||||||||||||
Non-employee compensation: | |||||||||||||||||
Board restricted stock | $ | 51 | $ | 191 | |||||||||||||
Board stock options | 12 | 54 | |||||||||||||||
Warrants | — | 11 | |||||||||||||||
Total non-employee stock-based compensation expense | $ | 63 | $ | 256 | |||||||||||||
Total stock-based compensation expense | $ | 203 | $ | 513 | |||||||||||||
Stock Incentive Plans | |||||||||||||||||
The Company uses the Black-Scholes-Merton option-pricing model for estimating the fair values of employee share options, employee and nonemployee warrants and similar instruments with the following key assumptions: | |||||||||||||||||
Expected Dividend Yield: The Company has not historically paid cash dividends on its common stock. | |||||||||||||||||
Expected Volatility: The Company estimates the expected volatility factor using the Company's historical stock price volatility. | |||||||||||||||||
Risk-Free Interest Rate: The Company bases the risk-free interest rate on the U.S. Treasury yield curve in effect at the time of grant or warrant for the period of the expected term as described. | |||||||||||||||||
Expected Term: The Company currently uses a simplified method for calculating the expected term based on the historical exercises of employee options and warrants and contractual expiration dates. For nonemployee warrants awarded to certain service providers or financing partners, the Company uses the contractual life of the warrants as the expected term, as the Company does not have sufficient experience with the service providers or financing partners to determine when they could be expected to exercise their warrants. | |||||||||||||||||
No stock options or warrants were issued during the three months ended March 31, 2015. | |||||||||||||||||
The assumptions used in calculating the fair value of employee common stock options and warrants granted during the three months ended March 31, 2014, using the Black-Scholes-Merton option-pricing model are set forth in the following table: | |||||||||||||||||
Three Months Ended March 31, | |||||||||||||||||
2014 | |||||||||||||||||
Dividend yield | — | ||||||||||||||||
Expected volatility | 51 | % | |||||||||||||||
Risk-free interest rate | 1.73 | % | |||||||||||||||
Expected term | 5.2 years | ||||||||||||||||
The assumptions used in calculating the fair value of non-employee common stock options and warrants granted during the three months ended March 31, 2014, using the Black-Scholes-Merton option-pricing model are set forth in the following table: | |||||||||||||||||
Three Months Ended March 31, | |||||||||||||||||
2014 | |||||||||||||||||
Dividend yield | — | ||||||||||||||||
Expected volatility | 51 | % | |||||||||||||||
Risk-free interest rate | 1.74 | % | |||||||||||||||
Expected term | 5.0 years | ||||||||||||||||
Employee and Non-employee Stock Options | |||||||||||||||||
The Company has two employee stock option plans: | |||||||||||||||||
• | The 2005 Stock Incentive Plan, which expires September 30, 2015 and provides for a maximum of 578,812 shares of common stock to be issued. | ||||||||||||||||
• | The 2011 Stock Incentive Plan, which expires March 28, 2021 and provides for a maximum of 2,152,500 shares of common stock to be issued. | ||||||||||||||||
Both plans permit the granting of incentive or nonqualified stock options. The 2011 Stock Incentive Plan also permits the granting of restricted stock. The plans are administered by the Board which has the authority to determine the employees to whom awards will be made, the amounts of the awards, and the other terms and conditions of the awards. The Company intends to use only the 2011 Stock Incentive Plan to make future grants. The number of securities remaining available for future issuance is 469,580. | |||||||||||||||||
Activity with respect to employee and non-employee stock options is summarized as follows: | |||||||||||||||||
Number of | Weighted- | Weighted- | Aggregate | ||||||||||||||
Shares (000's) | Average | Average | Intrinsic | ||||||||||||||
Exercise | Remaining | Value (in 000’s) | |||||||||||||||
Price | Contractual | ||||||||||||||||
Term (in years) | |||||||||||||||||
Outstanding, December 31, 2014 | 935 | $ | 4.91 | ||||||||||||||
Granted | — | $ | — | ||||||||||||||
Exercised | (3 | ) | $ | 1.3 | |||||||||||||
Forfeited | (10 | ) | $ | 4.06 | |||||||||||||
Expired | (28 | ) | $ | 4.03 | |||||||||||||
Outstanding, March 31, 2015 | 894 | $ | 4.96 | 7.3 | $ | 208 | |||||||||||
Vested at March 31, 2015 | 637 | $ | 5.31 | 6.6 | $ | 130 | |||||||||||
Total unrecognized compensation expense related to non-vested stock options at March 31, 2015 was approximately $0.3 million and is expected to be recognized over a weighted-average period of 1.9 years. | |||||||||||||||||
The following summary information reflects stock options outstanding and vested and related details as of March 31, 2015: | |||||||||||||||||
Stock Options Outstanding | Options Exercisable | ||||||||||||||||
Exercise Price | Number Outstanding (000's) | Weighted Average Remaining Contractual Term (in years) | Weighted Average Exercise Price | Vested at March 31, 2015 | Weighted Average Exercise Price | ||||||||||||
$1.30 | 13 | 0.6 | $ | 1.3 | 13 | $ | 1.3 | ||||||||||
$1.31 - $3.99 | 174 | 7.3 | $ | 3.91 | 63 | $ | 3.93 | ||||||||||
$4.00 - $4.30 | 352 | 7.8 | $ | 4.13 | 224 | $ | 4.1 | ||||||||||
$4.31 - $4.99 | 40 | 8.2 | $ | 4.51 | 22 | $ | 4.55 | ||||||||||
$5.00 - $7.62 | 315 | 6.8 | $ | 6.67 | 315 | $ | 6.67 | ||||||||||
Total | 894 | 7.3 | $ | 4.96 | 637 | $ | 5.31 | ||||||||||
In addition to the Company's stock option plans, the Company grants stock warrants to officers, directors, employees and certain consultants to the Company from time to time as determined by the Board and, when appropriate, the Compensation Committee of the Board. The Board administers the granting of warrants, determines the persons to whom awards will be made, the amount of the awards, and the other terms and conditions of the awards. | |||||||||||||||||
Employee Common Stock Warrants | |||||||||||||||||
Activity with respect to employee common stock warrants is summarized as follows: | |||||||||||||||||
Number of | Weighted- | Weighted- | Aggregate | ||||||||||||||
Shares (000's) | Average | Average | Intrinsic | ||||||||||||||
Exercise | Remaining | Value (in 000’s) | |||||||||||||||
Price | Contractual | ||||||||||||||||
Term (in years) | |||||||||||||||||
Outstanding, December 31, 2014 | 594 | $ | 4.15 | ||||||||||||||
Granted | — | $ | — | ||||||||||||||
Exercised | (7 | ) | $ | 2.24 | |||||||||||||
Forfeited | — | $ | — | ||||||||||||||
Expired | — | $ | — | ||||||||||||||
Outstanding, March 31, 2015 | 587 | $ | 4.17 | 7.6 | $ | 206 | |||||||||||
Vested at March 31, 2015 | 287 | $ | 3.83 | 5.6 | $ | 206 | |||||||||||
Total unrecognized compensation expense related to non-vested employee stock warrants at March 31, 2015, was approximately $0.4 million and is expected to be recognized over a weighted-average period of 2.5 years. | |||||||||||||||||
Restricted Stock | |||||||||||||||||
Activity with respect to restricted stock is summarized as follows: | |||||||||||||||||
Number of Shares (000's) | Weighted Avg. | ||||||||||||||||
Grant Date Fair | |||||||||||||||||
Value | |||||||||||||||||
Unvested at December 31, 2014 | 504 | $ | 3.68 | ||||||||||||||
Granted | 50 | $ | 4.01 | ||||||||||||||
Vested | (21 | ) | $ | 3.2 | |||||||||||||
Forfeited | (10 | ) | $ | 3.2 | |||||||||||||
Unvested at March 31, 2015 | 523 | $ | 3.74 | ||||||||||||||
Total unrecognized compensation expense related to non-vested restricted stock at March 31, 2015, was approximately $1.0 million and is expected to be recognized over a weighted-average period of 2.5 years. | |||||||||||||||||
Non-employee Common Stock Warrants | |||||||||||||||||
The Company has granted common stock warrants as compensation to consultants and advisors. The warrants have been issued for terms between two and ten years. | |||||||||||||||||
On March 28, 2014, the Company issued to the placement agents in the Company’s offering of the 2014 Notes, as partial compensation for serving as placement agents in such offering, five-year warrants to purchase an aggregate of 48,889 shares of common stock at an exercise price of $4.50 per share. The exercise price of the warrants is subject to certain anti-dilution adjustments. | |||||||||||||||||
Activity with respect to non-employee common stock warrants is summarized as follows: | |||||||||||||||||
Number of | Weighted- | Weighted- | Aggregate | ||||||||||||||
Shares (000's) | Average | Average | Intrinsic | ||||||||||||||
Exercise | Remaining | Value (000's) | |||||||||||||||
Price | Contractual | ||||||||||||||||
Term (in years) | |||||||||||||||||
Outstanding, December 31, 2014 | 2,123 | $ | 3.26 | ||||||||||||||
Granted | — | $ | — | ||||||||||||||
Exercised | (444 | ) | $ | 3.81 | |||||||||||||
Forfeited | — | $ | — | ||||||||||||||
Expired | — | $ | — | ||||||||||||||
Outstanding, March 31, 2015 | 1,679 | $ | 3.11 | 3.2 | $ | 2,136 | |||||||||||
Vested at March 31, 2015 | 1,483 | $ | 2.99 | 3 | $ | 2,069 | |||||||||||
Variable_Interest_Entities
Variable Interest Entities | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Variable Interest Entity, Consolidated, Carrying Amount, Assets and Liabilities, Net [Abstract] | |||||||||
VARIABLE INTEREST ENTITY | VARIABLE INTEREST ENTITY | ||||||||
As further described in Note 15 to our Consolidated Financial Statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014, the Company has one variable interest entity, Riverchase Village ADK, LLC ("Riverchase") that is required to be consolidated because AdCare has control as primary beneficiary. A “primary beneficiary” is the party that has both of the following characteristics: (i) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and (ii) the obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. | |||||||||
On March 3, 2014, the Company and certain of its subsidiaries entered into a letter agreement, dated as of February 28, 2014 (the "Letter Agreement"). On May 15, 2014, the Company and certain of its subsidiaries entered into an Amendment to the Letter Agreement (the “Letter Agreement First Amendment”), pursuant to which the Company agreed to pay $92,323 (the “Tax Payment”) to the appropriate governmental authorities of Jefferson County, Alabama, such amount representing outstanding real property taxes due on the Riverchase Village facility. The Company determined that it was in its best interest to make the Tax Payment in order to preserve the Company’s interest in the sale of the Riverchase Village facility. In connection with the Tax Payment, the parties also agreed to amend and restate the promissory note issued by Mr. Brogdon in favor of the Company to reflect a new principal amount of $615,986, which amount represents the original principal amount of the note plus the Tax Payment. Furthermore, the Letter Agreement First Amendment amended the Letter Agreement to provide that, if the closing of the sale of the Riverchase Village facility does not occur on or before December 31, 2014, then a payment of principal under the amended and restated promissory note equal to the Tax Payment will be due and payable to the Company on or before January 31, 2015. | |||||||||
On October 10, 2014, the Company and certain of its subsidiaries entered into a second amendment to the Letter Agreement, as amended (the “Letter Agreement Second Amendment”), with Mr. Brogdon and entities controlled by Mr. Brogdon, pursuant to which the Company reduced the principal amount of the promissory note issued by Mr. Brogdon by the amount equal to $92,323 (which represents the amount of the Tax Payment) plus $255,000 (which represents an offset of amounts owed by the Company to Mr. Brogdon under his consulting agreement with the Company). See “-Consulting Agreement.” | |||||||||
The Letter Agreement Second Amendment also amended the Letter Agreement, as amended, to provide that upon the closing of the sale of the Riverchase Village facility to a third party purchaser, the net sales proceeds from such sale shall be distributed so that any net sales proceeds shall first be paid to the Company to satisfy the $177,323 outstanding under the note issued by Riverchase to the Company, which note is discussed below. | |||||||||
On March 25, 2015, AdCare and certain of its subsidiaries entered into a third amendment to the Letter Agreement, as amended (the “Letter Agreement Third Amendment”), with Mr. Brogdon and entities controlled by him, pursuant to which Riverchase and the Company agreed to amend the promissory notes issued by Riverchase to the Company to: (i) increase the principal amount due under the promissory note issued by Riverchase to the Company by any additional real property tax payments made by the Company with respect to Riverchase Village, a 105-bed assisted living facility located in Hoover, Alabama and owned by Riverchase and (ii) to state that such promissory note would not bear interest. | |||||||||
The Letter Agreement Third Amendment amended the Letter Agreement to provide a schedule for the payment to the Company of the net sales proceeds resulting from a sale of the Riverchase Village facility to a third-party purchaser. The net sales proceeds from such sale shall be distributed to the Company as follows: (i) an amount sufficient to satisfy all amounts due and owing under the promissory note issued by Riverchase to the Company; (ii) one-half of the then remaining net sales proceeds; (iii) an amount sufficient to satisfy the amounts due and owing under the promissory note issued by Mr. Brogdon to the Company; and (iv) the then remaining balance of net sales proceeds. | |||||||||
AdCare is a guarantor of Riverchase’s obligations with respect to certain revenue bonds issued by the City of Hoover in connection with the Riverchase Village facility, and in order to preserve the Company's interest in the sale of the Riverchase Village facility, the Company made a payment in the amount of $85,000 (the "Principal Obligation") on behalf of Riverchase with respect to its obligations under the bonds. On October 10, 2014, Riverchase issued a promissory note in favor of the Company in the principal amount of $177,323, which represented the amount of a $92,323 tax payment plus the Principal Obligation. The note does not bear interest and is due upon the closing of the sale of the Riverchase Village facility. | |||||||||
In connection with the Letter Agreement Third Amendment on March 25, 2015, the Company and Mr. Brogdon agreed to amend the promissory note issued by Mr. Brogdon to the Company. Pursuant to this amendment, the principal balance plus any accrued interest under the promissory note issued by Mr. Brogdon to the Company shall be due and payable on the earlier of: (i) December 31, 2015; or (ii) the closing of the sale of the Riverchase Village facility. | |||||||||
The following summarizes the assets and liabilities of the variable interest entity included in the consolidated balance sheets: | |||||||||
(Amounts in 000’s) | 31-Mar-15 | 31-Dec-14 | |||||||
Cash | $ | — | $ | — | |||||
Assets of variable interest entity held for sale | 5,954 | 5,924 | |||||||
Other assets | 337 | 343 | |||||||
Total assets | $ | 6,291 | $ | 6,267 | |||||
Accounts payable | $ | 1,911 | $ | 1,923 | |||||
Accrued expenses | 914 | 651 | |||||||
Current portion of notes payable | 177 | 177 | |||||||
Liabilities of variable interest entity held for sale | 5,958 | 5,956 | |||||||
Non-controlling interest | (2,669 | ) | (2,440 | ) | |||||
Total liabilities and non-controlling interest | $ | 6,291 | $ | 6,267 | |||||
Commitments_and_Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES |
Regulatory Matters | |
Laws and regulations governing federal Medicare and state Medicaid programs are complex and subject to interpretation. Compliance with such laws and regulations can be subject to future governmental review and interpretation as well as significant regulatory action including fines, penalties, and exclusion from certain governmental programs. The Company believes that it is in compliance in all material respects with all applicable laws and regulations. | |
A significant portion of the Company’s revenue is derived from Medicaid and Medicare, for which reimbursement rates are subject to regulatory changes and government funding restrictions. Any significant future change to reimbursement rates could have a material effect on the Company’s operations. | |
Legal Matters | |
The skilled nursing business involves a significant risk of liability due to the age and health of the Company’s patients and residents and the services the Company provides. The Company and others in the industry are subject to an increasing number of claims and lawsuits, including professional liability claims, which may allege that services have resulted in personal injury, elder abuse, wrongful death or other related claims. The defense of these lawsuits may result in significant legal costs, regardless of the outcome, and can result in large settlement amounts or damage awards. | |
In addition to the potential lawsuits and claims described above, the Company is also subject to potential lawsuits under the Federal False Claims Act and comparable state laws alleging submission of fraudulent claims for services to any healthcare program (such as Medicare) or payer. A violation may provide the basis for exclusion from federally funded healthcare programs. As of March 31, 2015, the Company does not have any material loss contingencies recorded or requiring disclosure based upon the evaluation of the probability of loss from known claims, except as disclosed below. | |
On June 24, 2013, South Star Services, Inc. (“SSSI”), Troy Clanton and Rose Rabon (collectively, the “Plaintiffs”) filed a complaint in the District Court of Oklahoma County, State of Oklahoma against: (i) AdCare, certain of its wholly owned subsidiaries and AdCare’s former Chief Executive Officer (collectively, the “AdCare Defendants”); (ii) Christopher Brogdon and his wife; and (iii) five entities controlled by Mr. and Mrs. Brogdon, which entities own five skilled-nursing facilities located in Oklahoma that were previously managed by an AdCare subsidiary (the "Oklahoma Facilities"). The complaint alleges, with respect to the AdCare Defendants, that: (i) the AdCare Defendants tortuously interfered with contractual relations between the Plaintiffs and Mr. Brogdon, and with Plaintiffs’ prospective economic advantage, relating to SSSI’s right to manage the Oklahoma Facilities and seven other skilled-nursing facilities located in Oklahoma (collectively, the “Facilities”), respectively; (ii) the AdCare Defendants fraudulently induced the Plaintiffs to perform work and incur expenses with respect to the Facilities; and (iii) one of the AdCare subsidiaries which is an AdCare Defendant provided false and defamatory information to an Oklahoma regulatory authority regarding SSSI’s management of one of the Oklahoma Facilities. The complaint seeks damages against the AdCare Defendants, including punitive damages, in an unspecified amount, as well as costs and expenses, including reasonable attorney fees. On March 7, 2014, the Plaintiffs filed an amended complaint in which they alleged additional facts regarding the alleged fraudulent inducement caused by Mr. and Mrs. Brogdon and the AdCare Defendants. | |
On February 10, 2015, Plaintiffs and the defendants participated in a voluntary mediation in an attempt to resolve the case. Although the case did not settle at the mediation, Plaintiffs and defendants continued to negotiate over the following weeks and executed a settlement agreement on March 30, 2015 (the "Clanton Settlement Agreement") to settle all claims for a lump sum payment of $2.0 million. Under the Clanton Settlement Agreement, the Company is to pay $0.6 million to the Plaintiffs with the balance thereof to be paid by two of the Company's insurance carriers. The Company and the other defendants in the matter deny all of the Plaintiff's claims and any wrongdoing but agreed to settle the matter to avoid the continued expense and unpredictability of litigation. | |
On March 7, 2014, the Company responded to a letter received from the Ohio Attorney General ("OAG") dated February 25, 2014 demanding repayment of approximately $1.0 million as settlement for alleged improper Medicaid payments related to seven Ohio facilities affiliated with the Company. The OAG alleged that the Company had submitted improper Medicaid claims for independent laboratory services for glucose blood tests and capillary blood draws. The Company intends to defend itself against the claims. The Company has not recorded a liability for this matter because the liability, if any, and outcome cannot be determined at this time. | |
Income Tax Examinations | |
In early 2014, the Internal Revenue Service ("IRS") initiated an examination of the Company's income tax return for the 2011 income tax year. On May 7, 2014, the IRS completed and closed the examination and no changes were required to the Company's 2011 income tax return. | |
To the Company's knowledge, it is not currently under examination by any other major income tax jurisdiction. |
Related_Party_Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2015 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS |
Settlement and Indemnification Agreement | |
On March 26, 2015, the Company and certain entities controlled by Christopher Brogdon entered into a Settlement and Indemnification Agreement with respect to: (i) certain claims made by the Brogdon entities in connection with management and administrative services provided by the Company to the Brogdon entities under various management agreements; and (ii) certain pending, or threatened, legal proceedings against the Company and certain of its subsidiaries, and Mr. Brogdon and certain entities controlled by him, including the litigation filed in the District Court of Oklahoma County, State of Oklahoma and described in Note 13 - Commitments and Contingencies (collectively, and including any unasserted claims arising from the management agreements, the “AdCare Indemnified Claims”). Pursuant to the Settlement and Indemnification Agreement, the Company agreed to contribute up to $0.6 million towards the settlement of the litigation, and Mr. Brogdon and the Brogdon entities agree to release the Company from any and all claims arising in connection with the management agreements and to indemnify the Company with respect to the AdCare Indemnified Claims. | |
Personal Guarantor on Loan Agreements | |
Mr. Brogdon serves as personal guarantor on certain loan agreements totaling $17.9 million entered into by the Company prior to 2015. | |
Park City Capital | |
On March 27, 2014, the Company accepted a Subscription Agreement from Park City Capital Offshore Master, Ltd. (“Park City Offshore”), an affiliate of Michael J. Fox, the Lead Director of the Board of Directors, pursuant to which the Company issued to Park City Offshore in March 2014 $1.0 million in principal amount of the 2014 Notes. Mr. Fox is a director of Park City Offshore and a director of the Company and a beneficial owner of 5% of the outstanding common stock. The promissory note was offered to and sold to Park City Offshore on the same terms and conditions as all other buyers in the offering. | |
On March 31, 2015, the Company accepted a Subscription Agreement from Park City Capital Offshore, for 2015 Notes with an aggregate principal amount of $1.0 million. The 2015 Note was offered to Park City Offshore on the same terms and conditions as all other investors in the offering except the 2015 Note to be issued to Park City Capital Offshore is not subject to any Adjustment for Dilutive Equity Issuances. | |
Doucet Asset Management, LLC | |
On May 5, 2015, Doucet Capital, LLC, Doucet Asset Management, LLC, Christopher L. Doucet and Suzette A. Doucet jointly filed with the SEC a Schedule 13D reporting beneficial ownership of greater than 5% of the common stock. | |
On March 31, 2015, the Company accepted Subscription Agreements from Christopher L. Doucet and Suzette A. Doucet for 2015 Notes with an aggregate principal amount of $0.3 million. The 2015 Notes were offered to them on the same terms and conditions as all other investors in the offering. With respect to the offering of 2015 Notes, Institutional Securities Corporation served as the placement agent and Doucet Asset Management, LLC served as the selected dealer. Institutional Securities Corporation is affiliated with Doucet Asset Management, LLC and is entitled to receive a placement agent fee in the offering of approximately $0.1 million. |
Subsequent_Events
Subsequent Events | 3 Months Ended | |
Mar. 31, 2015 | ||
Subsequent Events [Abstract] | ||
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS | |
The Company has evaluated all subsequent events through the date the consolidated financial statements were issued and filed with the Securities and Exchange Commission. The following is a summary of the material subsequent events. | ||
Convertible Subordinated Note Private Placement | ||
On March 31, 2015, the Company entered into Subscription Agreements with certain accredited investors pursuant to which the Company accepted subscriptions for an aggregate of $8,500,000 in principal amount of the 2015 Notes. In connection therewith, the Company issued $1,685,000 in principal amount of 2015 Notes on March 31, 2015, upon receipt of payment therefor. | ||
On April 30, 2015, the Company issued an additional $6,015,000 in principal amount of 2015 Notes in respect of subscriptions accepted on March 31, 2015 and upon receipt of payment therefor. Accepted subscriptions for $800,000 in principal amount of 2015 Notes were not funded by the April 30, 2015 payment deadline, and 2015 Notes will not be issued in respect thereof. See Note 9 - Notes Payable and Other Debt - Convertible Debt - Convertible Subordinated Notes Issued in 2015 (the "2015 Notes"). | ||
Preferred Stock Offering | ||
On April 13, 2015, the Company issued and sold 575,000 shares of Series A Preferred Stock in a “best efforts” underwritten registered public offering for a public offering price of $25.75 per share. In connection therewith, the Company received net proceeds of $13.5 million, after the payment of underwriting commissions and discounts and other offering expense payable by the Company. | ||
Oklahoma Lease Agreements | ||
On April 29, 2015, two wholly-owned subsidiaries (each, a “Sublessor”) of the Company entered into separate sublease agreements with Southwest LTC-Quail Creek, LLC and Southwest LTC-NW OKC, LLC (each, a "Sublessee") pursuant to which each Sublessor will lease one of two skilled nursing facilities. The two facilities are as follows: | ||
▪ | Quail Creek Nursing Home, a 109-bed skilled nursing facility located in Oklahoma City, OK. | |
▪ | Northwest Nursing Center, an 88-bed skilled nursing facility located in Oklahoma City OK. | |
The leases commence on October 1, 2015, subject to, among other things: (i) such Sublessee’s receipt of all licenses and other approvals from the State of Oklahoma to operate such facility; and (ii) approval of the mortgage lender with respect to such facility. Each sublease agreement is structured as triple net lease wherein the Sublessee is responsible for the day-to-day operation, ongoing maintenance, taxes and insurance for the duration of the sublease. Pursuant to each sublease agreement, the initial lease term is ten years with two separate renewal terms of five years each. The annual rent under all of the sublease agreements in the first year will be $0.96 million and will escalate thereafter on an annual basis through the initial term and any renewal terms. The sublease agreements are cross-defaulted. In connection with entering into the sublease agreements, each Sublessor and Sublessee also entered into an operations transfer agreement with respect to the applicable facilities, each containing customary terms and conditions. | ||
Disposition Agreement | ||
On April 29, 2015, a wholly-owned subsidiary of the Company (the “Companions Seller”) entered into an asset purchase agreement (the “Companions Sale Agreement”) with Gracewood Manor, LLC, an Oklahoma limited liability company (the “Companions Purchaser”), to sell Companions, a 102-bed skilled nursing facility located in Tulsa, Oklahoma. The Companions Sale Agreement may be terminated by the Companions Purchaser for any reason before the 30th day of the due diligence period set forth in the agreement. The sale is subject to the completion of satisfactory due diligence, the receipt of required licenses and other state regulatory approvals, and the satisfaction of other customary closing conditions. Pursuant to the Companions Sale Agreement, the sale price of $3.5 million is due to the Companions Seller on the closing date after completion of customary closing conditions but no later than July 1, 2015. In connection with entering into the Companions Sale Agreement, the Companions Seller and Companions Purchaser entered into an operations transfer agreement to transfer the operations of Companions concurrent with the closing of the asset purchase agreement. | ||
Arkansas Leases | ||
Eight of the separate sublease agreements with affiliates of Aria Health Group, LLC ("Aria") commenced on May 1, 2015. The remaining two sublease agreements with affiliates of Aria terminated effective April 30, 2015. | ||
On April 30, 2015, the Company entered into a Lease Inducement Fee Agreement with Aria Health Consulting, LLC, pursuant to which the Company paid to Aria Health Consulting, LLC a fee of $2.0 million as a lease inducement for the Aria Sublessees to enter into the third amendment of the sublease agreements described below and to commence such subleases and transfer operations thereunder. | ||
On April 30, 2015, the eight Aria Sublessors entered into a third amendment with the eight Aria Sublessees, which amended each separate sublease agreement to, among other things: (i) extend the initial sublease term to ten years and (ii) provide that the Aria Sublessees shall, collectively, pay to the Aria Sublessors special rent in the amount of $29,500 per month payable in advance on or before the first day of each month (except for the first special rent payment, which shall be subtracted from the lease inducement fee paid by the Company under the Lease Inducement Fee Agreement). | ||
As a condition to the Aria Sublessees agreement to a commencement date of May 1, 2015, the Company and the Aria Sublessees agreed to assess, in good faith and within thirty (30) days following the commencement date, making a one-time equitable adjustment to base rent equal to the difference between the facilities 2014 professional liability and general liability insurance costs and projected costs for the first lease year of comparable or mutually acceptable insurance as further adjusted by anticipated Medicaid reimbursement rate increases solely from such added costs. | ||
Each sublease agreement is structured as triple net lease wherein each Aria Sublessee is responsible for the day-to-day operation, ongoing maintenance, taxes and insurance for the duration of the sublease. Pursuant to each sublease agreement, the initial lease term is ten years with a five-year renewal option. The annual base rent under all of the sublease agreements in the first year is $5.3 million in the aggregate (exclusive of any equitable adjustment as described above), and the annual base rent under each sublease will escalate at 2% each year through the initial term and 3% per year upon renewal. The sublease agreements are cross-defaulted. | ||
In connection with entering into the sublease agreements, each Aria Sublessor and Aria Sublessee also entered into an operations transfer agreement with respect to the applicable facility, each containing customary terms and conditions. | ||
Loan Modifications | ||
On May 1, 2015, Little Rock HC&R Property Holdings, LLC, a wholly owned subsidiary of the Company (“Private Bank Borrower”), entered into a Fifth Modification Agreement with PrivateBank, which modified that certain Loan Agreement, dated March 30, 2012, as amended, between the PrivateBank Borrower and PrivateBank. The Fifth Modification, among other things: (i) provides for lender consent to the sublease of the Company’s Little Rock Health & Rehabilitation Center to an affiliate of Aria; and (ii) amends the minimum EBITDAR covenant discussed in the Loan Agreement to reflect a new facility operator, Highlands of Little Rock West Markham, LLC. | ||
On May 1, 2015, Benton Property Holdings, LLC, Park Heritage Property Holdings, LLC, and Valley River Property Holdings, LLC, each a wholly owned subsidiary of the Company (collectively, the “Borrower Group”), entered into a Loan Modification Agreement with PrivateBank, which modified that certain Loan Agreement, dated September 1, 2011, as amended, between the Borrower Group and PrivateBank. The Modification, among other things: (i) provides for lender consent to the sublease of the Company’s Heritage Park Nursing Center to an affiliate of Aria; and (ii) amends the minimum EBITDA covenant described in the Loan Agreement to (a) reflect a new facility operator, Highlands of Rogers Dixieland, LLC, and (b) change the minimum EBITDA covenant to a “Minimum EBITDAR/Management Fee” covenant, which modifies minimum EBITDAR to take into account management fees equal to the greater of the operator’s actual management fees for such period or imputed management fees equal to 5% of such operator’s gross income for such period, as determined in accordance with generally accepted accounting principles. |
Significant_Accounting_Policie1
Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2015 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation |
The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Rule 8-03 of Article 8 of Regulations S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. Changes to GAAP are established by the Financial Accounting Standards Board (“FASB”) in the form of Accounting Standards Updates (“ASUs”) to the FASB’s Accounting Standards Codification (“ASC”). In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of the results of operations for the periods presented have been included. Operating results for the three months ended March 31, 2015 and 2014, are not necessarily indicative of the results that may be expected for the fiscal year. The balance sheet at December 31, 2014, has been derived from the audited consolidated financial statements at that date, but does not include all of the information and footnotes required by GAAP for complete financial statements. | |
You should read these consolidated financial statements together with the historical consolidated financial statements of the Company for the year ended December 31, 2014 included in the Annual Report. | |
The Company operates in one business segment. These statements include the accounts of AdCare Health Systems, Inc. and its controlled subsidiaries. Controlled subsidiaries include AdCare’s majority owned subsidiaries and one variable interest entity (a "VIE") in which AdCare has control as primary beneficiary. All inter-company accounts and transactions were eliminated in the consolidation. | |
Use of Estimates | Use of Estimates |
The preparation of consolidated financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported results of operations during the reporting period. Examples of significant estimates include allowance for doubtful accounts, contractual allowances for Medicaid, Medicare, and managed care reimbursements, deferred tax valuation allowance, fair value of derivative instruments, fair value of employee and nonemployee stock based awards, and valuation of goodwill and other long-lived assets. Actual results could differ materially from those estimates. | |
Reclassifications | Reclassifications |
Certain items previously reported in the consolidated financial statement captions have been reclassified to conform to the current financial statement presentation with no effect on the Company’s consolidated financial position or results of operations. These reclassifications did not affect total assets, total liabilities, or stockholders’ equity. Reclassifications were made to the Consolidated Statements of Operations for the three months ended March 31, 2014 to reflect the same facilities in discontinued operations for both periods presented. | |
Revenue Recognition and Patient Care Receivables | Revenue Recognition and Patient Care Receivables |
The Company recognizes revenue when the following four conditions have been met: (i) there is persuasive evidence that an arrangement exists; (ii) delivery has occurred or service has been rendered; (iii) the price is fixed or determinable; and (iv) collection is reasonably assured. The Company's revenue is derived primarily from providing healthcare services to residents and is recognized on the date services are provided at amounts billable to the individual. For reimbursement arrangements with third-party payors, including Medicaid, Medicare and private insurers, revenue is recorded based on contractually agreed-upon amounts on a per patient, daily basis. | |
Revenue from the Medicaid and Medicare programs accounted for 83.8% of the Company’s revenue for the three months ended March 31, 2015, and 84.5% of the Company's revenue for the three months ended March 31, 2014. The Company records revenue from these governmental and managed care programs as services are performed at their expected net realizable amounts under these programs. The Company’s revenue from governmental and managed care programs is subject to audit and retroactive adjustment by governmental and third-party agencies. Consistent with healthcare industry accounting practices, any changes to these governmental revenue estimates are recorded in the period the change or adjustment becomes known. The Company recorded retroactive adjustments to revenue which were not material to the Company's consolidated revenue for the three months ended March 31, 2015 and 2014. | |
Potentially uncollectible patient accounts are provided for on the allowance method based upon management's evaluation of outstanding accounts receivable at period-end and historical experience. Uncollected accounts that are written off are charged against allowance. As of March 31, 2015 and December 31, 2014, the Company has an allowance for uncollectible accounts of $7.7 million and $6.7 million, respectively. | |
Management Fee Receivables and Revenues | Management Fee Revenues and Receivables |
Management fee revenues and receivables are recorded in the month that services are provided. As of March 31, 2015 and December 31, 2014, the Company evaluated collectibility of management fees and determined that no allowance was required. | |
Fair Value Measurements and Financial Instruments | Fair Value Measurements and Financial Instruments |
Accounting guidance establishes a three-level valuation hierarchy for disclosure of fair value measurements. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels are defined as follows: | |
Level 1— Quoted market prices in active markets for identical assets or liabilities | |
Level 2— Other observable market-based inputs or unobservable inputs that are corroborated by market data | |
Level 3— Significant unobservable inputs | |
The respective carrying value of certain financial instruments of the Company approximates their fair value. These instruments include cash and cash equivalents, restricted cash and investments, accounts receivable, notes receivable, notes payable and other debt, and accounts payable. Fair values were assumed to approximate carrying values for these financial instruments because they are short-term in nature and their carrying amounts approximate fair values, they are receivable or payable on demand, or the interest rates earned and/or paid approximate current market rates. | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements |
Except for rules and interpretive releases of the SEC under authority of federal securities laws and a limited number of grandfathered standards, the FASB ASC is the sole source of authoritative GAAP literature recognized by the FASB and applicable to the Company. The Company has reviewed the FASB accounting pronouncements and ASU interpretations that have effectiveness dates during the periods reported and in future periods. | |
In April 2014, the FASB issued ASU 2014-08 that amends the definition of a discontinued operation to include only those disposals of components of an entity that represent a strategic shift that has (or will have) a major effect on an entity’s operations and financial results. This ASU should be applied prospectively and is effective for the Company for the 2015 annual and interim periods. Early adoption is permitted for disposals that have not been reported in financial statements previously issued. The Company has adopted this ASU as of March 31, 2015. | |
In May 2014, the FASB issued ASU 2014-09 guidance requiring revenue to be recognized in an amount that reflects the consideration expected to be received in exchange for those goods and services. The guidance requires the disclosure of sufficient quantitative and qualitative information for financial statement users to understand the nature, amount, timing and uncertainty of revenue and associated cash flows arising from contracts with customers. The guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period, with early adoption precluded. The Company has not yet determined the impact, if any, that the adoption of this guidance will have on its consolidated financial position or results of operations. | |
In August 2014, the FASB issued ASU 2014-15 guidance regarding an entity’s ability to continue as a going concern, which requires management to assess a company’s ability to continue as a going concern and to provide related footnote disclosures in certain circumstances. Before this new standard, there was minimal guidance in GAAP specific to going concern. Under the new standard, disclosures are required when conditions give rise to substantial doubt about a company’s ability to continue as a going concern within one year from the financial statement issuance date. The guidance is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period, with early adoption permitted. The Company has not yet determined the impact, if any, that the adoption of this guidance will have on its consolidated financial statements. | |
In April 2015, the FASB issued ASU 2015-03 guidance regarding debt issuance costs as a part of the simplification and productivity initiative. Under this guidance, debt issuance costs will be presented as a direct reduction from the carrying amount of the debt liability, consistent with the presentation of debt discounts. The amortization of debt issuance costs will be reported as interest expense. The new guidance is to be applied on a retrospective basis and reported as a change in an accounting principle. This guidance is effective for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period. Early adoption is permitted for financial statements that have not been previously issued. The Company is currently evaluating changes in its accounting required by this new guidance and the impact to the Company's financial position, results of operations and related disclosures. |
Earnings_Per_Share_Tables
Earnings Per Share (Tables) | 3 Months Ended | ||||||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||
Reconciliation of net income (loss) for continuing and discontinued operations and the number of common shares used in the computation of both basic and diluted earnings per share | The following tables provide a reconciliation of net income (loss) for continuing and discontinued operations and the number of shares of common stock used in the computation of both basic and diluted earnings per share: | ||||||||||||||||||||||
Three Months Ended March 31, | |||||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||||
(Amounts in 000’s, except per share data) | Income | Shares | Per | Income | Shares | Per | |||||||||||||||||
(loss) | Share | (loss) | Share | ||||||||||||||||||||
Continuing Operations: | |||||||||||||||||||||||
Loss from continuing operations | $ | (3,842 | ) | $ | (2,598 | ) | |||||||||||||||||
Net loss attributable to noncontrolling interests | 230 | 173 | |||||||||||||||||||||
Basic loss from continuing operations | $ | (3,612 | ) | 19,218 | $ | (0.19 | ) | $ | (2,425 | ) | 16,916 | $ | (0.14 | ) | |||||||||
Preferred stock dividend | (646 | ) | 19,218 | $ | (0.03 | ) | (646 | ) | 16,916 | $ | (0.04 | ) | |||||||||||
Effect of dilutive securities: Stock options, warrants outstanding and subordinated convertible promissory notes (a) | |||||||||||||||||||||||
Diluted loss from continuing operations | $ | (4,258 | ) | 19,218 | $ | (0.22 | ) | $ | (3,071 | ) | 16,916 | $ | (0.18 | ) | |||||||||
Discontinued Operations: | |||||||||||||||||||||||
Basic income (loss) from discontinued operations | (1,407 | ) | 19,218 | $ | (0.07 | ) | 75 | 16,916 | $ | — | |||||||||||||
Diluted income (loss) from discontinued operations | (1,407 | ) | 19,218 | $ | (0.07 | ) | 75 | 16,916 | $ | — | |||||||||||||
Net Loss Attributable to AdCare: | |||||||||||||||||||||||
Basic loss | (5,665 | ) | 19,218 | $ | (0.29 | ) | (2,996 | ) | 16,916 | $ | (0.18 | ) | |||||||||||
Diluted loss | (5,665 | ) | 19,218 | $ | (0.29 | ) | (2,996 | ) | 16,916 | $ | (0.18 | ) | |||||||||||
(a) Securities outstanding that were excluded from the computation, prior to the use of the treasury stock method, because they would have been anti-dilutive are as follows: | |||||||||||||||||||||||
Schedule of securities outstanding that were excluded from the computation, prior to the use of the treasury stock method, because they would have been anti-dilutive | |||||||||||||||||||||||
March 31, | |||||||||||||||||||||||
(Amounts in 000’s) | 2015 | 2014 | |||||||||||||||||||||
Outstanding Stock Options | 894 | 1,758 | |||||||||||||||||||||
Outstanding Warrants - employee | 587 | 1,876 | |||||||||||||||||||||
Outstanding Warrants - nonemployee | 1,679 | 1,019 | |||||||||||||||||||||
Subordinated Convertible Promissory Notes | 3,804 | 4,406 | |||||||||||||||||||||
Total anti-dilutive securities | 6,964 | 9,059 | |||||||||||||||||||||
Restricted_Cash_and_Investment1
Restricted Cash and Investments (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Restricted Cash and Investments [Abstract] | |||||||||
Schedule of restricted cash, escrow deposits and investments | The following table sets forth the Company’s various restricted cash, escrow deposits and investments: | ||||||||
(Amounts in 000’s) | 31-Mar-15 | 31-Dec-14 | |||||||
HUD escrow deposits | $ | 321 | $ | 289 | |||||
Lender's collection account | 391 | 35 | |||||||
Current replacement reserves | 133 | 9 | |||||||
HUD current replacement reserves | 637 | 637 | |||||||
Collateral cash and certificates of deposit | 1,758 | 2,302 | |||||||
Property tax escrow | 63 | 49 | |||||||
Total current portion | 3,303 | 3,321 | |||||||
HUD replacement reserves | 1,047 | 1,074 | |||||||
Reserves for capital improvements | 256 | 936 | |||||||
Restricted investments for other debt obligations | 3,466 | 3,446 | |||||||
Total noncurrent portion | 4,769 | 5,456 | |||||||
Total restricted cash and investments | $ | 8,072 | $ | 8,777 | |||||
Intangible_Assets_and_Goodwill1
Intangible Assets and Goodwill (Tables) | 3 Months Ended | ||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||
Schedule of intangible assets | Intangible assets consist of the following: | ||||||||||||||||
(Amounts in 000’s) | Bed Licenses (included in property and equipment) | Bed Licenses - Separable | Lease Rights | Total | |||||||||||||
Balances, December 31, 2014 | |||||||||||||||||
Gross | $ | 36,948 | $ | 2,471 | $ | 8,824 | $ | 48,243 | |||||||||
Accumulated amortization | (3,855 | ) | — | (4,737 | ) | (8,592 | ) | ||||||||||
Net carrying amount | $ | 33,093 | $ | 2,471 | $ | 4,087 | $ | 39,651 | |||||||||
Amortization expense | (308 | ) | — | (167 | ) | (475 | ) | ||||||||||
Balances, March 31, 2015 | |||||||||||||||||
Gross | 36,948 | 2,471 | 8,824 | 48,243 | |||||||||||||
Accumulated amortization | (4,163 | ) | — | (4,904 | ) | (9,067 | ) | ||||||||||
Net carrying amount | $ | 32,785 | $ | 2,471 | $ | 3,920 | $ | 39,176 | |||||||||
Schedule of estimated amortization expense for all definite lived intangibles | Expected amortization expense for all definite lived intangibles for each of the years ended December 31 is as follows: | ||||||||||||||||
(Amounts in 000’s) | Bed Licenses | Lease Rights | |||||||||||||||
2015(a) | $ | 924 | $ | 500 | |||||||||||||
2016 | 1,232 | 667 | |||||||||||||||
2017 | 1,232 | 667 | |||||||||||||||
2018 | 1,232 | 667 | |||||||||||||||
2019 | 1,232 | 667 | |||||||||||||||
Thereafter | 26,933 | 752 | |||||||||||||||
Total expected amortization expense | $ | 32,785 | $ | 3,920 | |||||||||||||
(a) Estimated amortization expense for the year ending December 31, 2015 includes only amortization to be recorded after March 31, 2015. | |||||||||||||||||
Summary of the changes in the carrying amount of goodwill | The following table summarizes the carrying amount of goodwill: | ||||||||||||||||
(Amounts in 000’s) | 31-Mar-15 | 31-Dec-14 | |||||||||||||||
Goodwill | $ | 5,023 | $ | 5,023 | |||||||||||||
Accumulated impairment losses | (799 | ) | (799 | ) | |||||||||||||
Total | $ | 4,224 | $ | 4,224 | |||||||||||||
Property_and_Equipment_Tables
Property and Equipment (Tables) | 3 Months Ended | ||||||||||
Mar. 31, 2015 | |||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||
Schedule of property and equipment | The following table sets forth the Company’s property and equipment: | ||||||||||
(Amounts in 000’s) | Estimated Useful | 31-Mar-15 | 31-Dec-14 | ||||||||
Lives (Years) | |||||||||||
Buildings and improvements | May-40 | $ | 131,452 | $ | 132,842 | ||||||
Equipment | 10-Feb | 13,427 | 13,616 | ||||||||
Land | — | 7,432 | 7,437 | ||||||||
Computer related | 10-Feb | 2,921 | 2,913 | ||||||||
Construction in process | — | 46 | 52 | ||||||||
155,278 | 156,860 | ||||||||||
Less: accumulated depreciation and amortization expense | 22,284 | 21,275 | |||||||||
Property and equipment, net | $ | 132,994 | $ | 135,585 | |||||||
Leases_Tables
Leases (Tables) | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Leases [Abstract] | |||||
Schedule of Future Minimum Rental Payments for Operating Leases | Future minimum lease payments for each of the next five years ending December 31, are as follows: | ||||
(Amounts in | |||||
000's) | |||||
2015(a) | $ | 5,113 | |||
2016 | 6,688 | ||||
2017 | 6,593 | ||||
2018 | 6,539 | ||||
2019 | 6,060 | ||||
Thereafter | 6,637 | ||||
Total | $ | 37,630 | |||
Accrued_Expenses_Tables
Accrued Expenses (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Payables and Accruals [Abstract] | |||||||||
Schedule of accrued expenses | Accrued expenses consist of the following: | ||||||||
(Amounts in 000’s) | 31-Mar-15 | 31-Dec-14 | |||||||
Accrued payroll related | $ | 6,521 | $ | 6,915 | |||||
Accrued employee benefits | 3,987 | 3,405 | |||||||
Real estate and other taxes | 1,613 | 1,335 | |||||||
Other accrued expenses | 5,353 | 3,998 | |||||||
Total accrued expenses | $ | 17,474 | $ | 15,653 | |||||
Notes_Payable_and_Other_Debt_T
Notes Payable and Other Debt (Tables) | 3 Months Ended | ||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||
Schedule of notes payable and other debt | Notes payable and other debt consist of the following: | ||||||||||||||||||
(Amounts in 000’s) | 31-Mar-15 | 31-Dec-14 | |||||||||||||||||
Revolving credit facilities and lines of credit | $ | 5,070 | $ | 6,832 | |||||||||||||||
Senior debt - guaranteed by HUD | 25,883 | 26,022 | |||||||||||||||||
Senior debt - guaranteed by USDA | 26,964 | 27,128 | |||||||||||||||||
Senior debt - guaranteed by SBA | 3,665 | 3,703 | |||||||||||||||||
Senior debt - bonds, net of discount (a) | 12,972 | 12,967 | |||||||||||||||||
Senior debt - other mortgage indebtedness (b) | 60,365 | 60,277 | |||||||||||||||||
Other debt | 1,167 | 430 | |||||||||||||||||
Convertible debt issued in 2012 | 7,500 | 7,500 | |||||||||||||||||
Convertible debt issued in 2014 | 849 | 6,500 | |||||||||||||||||
Convertible debt issued in 2015 | 7,336 | — | |||||||||||||||||
Total | $ | 151,771 | $ | 151,359 | |||||||||||||||
Less: current portion | 17,602 | 22,113 | |||||||||||||||||
Less: portion included in liabilities of disposal group held for sale (b) | 6,180 | 5,197 | |||||||||||||||||
Less: portion included in liabilities of variable interest entity held for sale (a) | 5,958 | 5,956 | |||||||||||||||||
Notes payable and other debt, net of current portion | $ | 122,031 | $ | 118,093 | |||||||||||||||
(a) The senior debt - bonds, net of discount includes $6.0 million at both March 31, 2015 and December 31, 2014 related to the Company's consolidated variable interest entity, Riverchase Village ADK, LLC ("Riverchase"), revenue bonds, in two series, issued by the Medical Clinical Board of the City of Hoover in the State of Alabama, which the Company has guaranteed the obligation under such bonds. | |||||||||||||||||||
(b) The senior debt - other mortgage indebtedness includes $5.0 million related to the outstanding loan entered into in conjunction with the acquisition of Companions in August 2012. | |||||||||||||||||||
Summary of the scheduled maturities | The schedule below summarizes the scheduled maturities for the twelve months ended March 31 of the respective year. The 2016 maturities include outstanding loans of $5.2 million related to the Companions facility and $1.0 million related to one of the two Hembree Road office buildings which are classified as liabilities of a disposal group held for sale and $6.0 million related to the Riverchase bonds classified as liabilities of a variable interest entity held for sale at March 31, 2015. | ||||||||||||||||||
(Amounts in 000’s) | |||||||||||||||||||
2016 | $ | 29,912 | |||||||||||||||||
2017 | 50,287 | ||||||||||||||||||
2018 | 11,263 | ||||||||||||||||||
2019 | 1,778 | ||||||||||||||||||
2020 | 1,866 | ||||||||||||||||||
Thereafter | 57,053 | ||||||||||||||||||
Subtotal | 152,159 | ||||||||||||||||||
Less: unamortized discounts ($172 classified as current) | (388 | ) | |||||||||||||||||
Total notes and other debt | $ | 151,771 | |||||||||||||||||
Schedule of credit-related instruments, out of compliance | The table below indicates which of the Company's credit-related instruments are out of compliance as of March 31, 2015: | ||||||||||||||||||
Credit Facility | Balance at | Financial Covenant | Min/Max | Financial | Future | ||||||||||||||
31-Mar-15 | Financial | Covenant | Financial | ||||||||||||||||
(000's) | Covenant | Metric | Covenant | ||||||||||||||||
Required | Achieved | Metric | |||||||||||||||||
Required (a) | |||||||||||||||||||
Gemino Lines of Credit | $ | 2,274 | Fixed Charge Coverage Ratio (FCCR) | 0.8 | 0.58 | 1.1 | |||||||||||||
PrivateBank - Line of Credit | $ | 1,550 | Coverage of Rent and Debt Service | 1.25 | 0.65 | 1.25 | |||||||||||||
Minimum TTM Fixed Charge Coverage | 1.05 | 0.93 | 1.05 | ||||||||||||||||
Contemporary Healthcare Capital - Term Note and Line of Credit - CSCC Nursing, LLC | $ | 197 | Minimum Implied Current Ratio | 1 | 0.95 | 1 | |||||||||||||
$ | 5,000 | DSCR | 1.15 | (0.76 | ) | 1.15 | |||||||||||||
Minimum Occupancy | 70 | % | 64 | % | 70 | % | |||||||||||||
PrivateBank - Mortgage Note - Valley River Nursing, LLC; Park Heritage Nursing, LLC; Benton Nursing, LLC | $ | 10,946 | Minimum EBITDAR (000s) | $ | 450 | $ | 59 | n/a | |||||||||||
Fixed Charge Coverage Ratio (FCCR) | 1.05 | 0.76 | n/a | ||||||||||||||||
PrivateBank - Mortgage Note - APH&R Property Holdings, LLC; Northridge HC&R Property Holdings, LLC; Woodland Hills HC Property Holdings, LLC | $ | 11,982 | Minimum Debt Service Coverage | 1.75 | 0.53 | n/a | |||||||||||||
Minimum Quarterly Rent (000s) | $ | 290 | $ | 177 | n/a | ||||||||||||||
Minimum Operator Fixed Charge Coverage | 1.1 | 0.57 | n/a | ||||||||||||||||
PrivateBank - Mortgage Note - Georgetown HC&R Property Holdings, LLC; Sumter Valley Property Holdings, LLC | $ | 9,285 | Minimum Quarterly Rent (000s) | $ | 235 | $ | 199 | $ | 235 | ||||||||||
PrivateBank - Mortgage Note - Little Rock HC&R Nursing, LLC | $ | 11,570 | Minimum EBITDAR (000s) | $ | 358 | $ | 42 | n/a | |||||||||||
Operator's Minimum Fixed Charge Coverage | 1.05 | 0.87 | n/a | ||||||||||||||||
(a) Items marked as "n/a" reflect metric requirements which will be revised or eliminated in subsequent testing periods given that operation transfers have occurred subsequent to the period end. |
Discontinued_Operations_Tables
Discontinued Operations (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Home Health Business | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Schedule of operations, assets and liabilities of the disposal groups held for sale | The following table summarizes the activity of discontinued operations for the three months ended March 31, 2015 and 2014: | ||||||||
Three Months Ended March 31, | |||||||||
(Amounts in 000’s) | 2015 | 2014 | |||||||
Total revenues from discontinued operations | $ | 718 | $ | 9,421 | |||||
Net gain (loss) from discontinued operations | $ | (1,407 | ) | $ | 75 | ||||
Interest expense, net from discontinued operations | $ | 260 | $ | 261 | |||||
On January 21, 2015, the Company listed for sale its two office buildings located on Hembree Road in Roswell, Georgia as part of its transition to a healthcare property holding and leasing company. The assets and liabilities of the two Hembree Road buildings have been reclassified to assets and liabilities of disposal groups held for sale as of March 31, 2015. | |||||||||
Assets and liabilities of the disposal groups held for sale at March 31, 2015 and December 31, 2014 are as follows: | |||||||||
(Amounts in 000’s) | 31-Mar-15 | 31-Dec-14 | |||||||
Property and equipment, net | $ | 5,187 | $ | 3,777 | |||||
Other assets | 2,044 | 2,036 | |||||||
Assets of disposal groups held for sale | $ | 7,231 | $ | 5,813 | |||||
Notes payable | $ | 5,983 | $ | 5,000 | |||||
Line of credit | 197 | 197 | |||||||
Liabilities of disposal group held for sale | $ | 6,180 | $ | 5,197 | |||||
Riverchase | Riverchase Village Facility | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Schedule of operations, assets and liabilities of the disposal groups held for sale | Assets and liabilities of the variable interest entity held for sale at March 31, 2015 and December 31, 2014 are as follows: | ||||||||
Amounts in (000's) | March 31, 2015 | December 31, 2014 | |||||||
Property and equipment, net | $ | 5,893 | $ | 5,893 | |||||
Other assets | 61 | 31 | |||||||
Assets of variable interest entity held for sale | $ | 5,954 | $ | 5,924 | |||||
Bonds payable | $ | 5,958 | $ | 5,956 | |||||
Liabilities of variable interest entity held for sale | $ | 5,958 | $ | 5,956 | |||||
Stock_Based_Compensation_Table
Stock Based Compensation (Tables) | 3 Months Ended | ||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||
Stock based compensation | |||||||||||||||||
Summary of recognized stock based compensation | For the three months ended March 31, 2015 and 2014, the Company recognized stock-based compensation as follows: | ||||||||||||||||
Three Months Ended March 31, | |||||||||||||||||
(Amounts in 000’s) | 2015 | 2014 | |||||||||||||||
Employee compensation: | |||||||||||||||||
Stock options | $ | 44 | $ | 182 | |||||||||||||
Employee warrants | 33 | 41 | |||||||||||||||
Management restricted stock | 63 | 34 | |||||||||||||||
Total employee stock-based compensation expense | $ | 140 | $ | 257 | |||||||||||||
Non-employee compensation: | |||||||||||||||||
Board restricted stock | $ | 51 | $ | 191 | |||||||||||||
Board stock options | 12 | 54 | |||||||||||||||
Warrants | — | 11 | |||||||||||||||
Total non-employee stock-based compensation expense | $ | 63 | $ | 256 | |||||||||||||
Total stock-based compensation expense | $ | 203 | $ | 513 | |||||||||||||
Schedule of assumptions used in calculating the fair value of warrants granted using the Black Sholes Merton option-pricing model | The assumptions used in calculating the fair value of non-employee common stock options and warrants granted during the three months ended March 31, 2014, using the Black-Scholes-Merton option-pricing model are set forth in the following table: | ||||||||||||||||
Three Months Ended March 31, | |||||||||||||||||
2014 | |||||||||||||||||
Dividend yield | — | ||||||||||||||||
Expected volatility | 51 | % | |||||||||||||||
Risk-free interest rate | 1.74 | % | |||||||||||||||
Expected term | 5.0 years | ||||||||||||||||
Summary of employee stock options activity | Activity with respect to employee and non-employee stock options is summarized as follows: | ||||||||||||||||
Number of | Weighted- | Weighted- | Aggregate | ||||||||||||||
Shares (000's) | Average | Average | Intrinsic | ||||||||||||||
Exercise | Remaining | Value (in 000’s) | |||||||||||||||
Price | Contractual | ||||||||||||||||
Term (in years) | |||||||||||||||||
Outstanding, December 31, 2014 | 935 | $ | 4.91 | ||||||||||||||
Granted | — | $ | — | ||||||||||||||
Exercised | (3 | ) | $ | 1.3 | |||||||||||||
Forfeited | (10 | ) | $ | 4.06 | |||||||||||||
Expired | (28 | ) | $ | 4.03 | |||||||||||||
Outstanding, March 31, 2015 | 894 | $ | 4.96 | 7.3 | $ | 208 | |||||||||||
Vested at March 31, 2015 | 637 | $ | 5.31 | 6.6 | $ | 130 | |||||||||||
Shares authorized under stock option plans, by exercise price range | The following summary information reflects stock options outstanding and vested and related details as of March 31, 2015: | ||||||||||||||||
Stock Options Outstanding | Options Exercisable | ||||||||||||||||
Exercise Price | Number Outstanding (000's) | Weighted Average Remaining Contractual Term (in years) | Weighted Average Exercise Price | Vested at March 31, 2015 | Weighted Average Exercise Price | ||||||||||||
$1.30 | 13 | 0.6 | $ | 1.3 | 13 | $ | 1.3 | ||||||||||
$1.31 - $3.99 | 174 | 7.3 | $ | 3.91 | 63 | $ | 3.93 | ||||||||||
$4.00 - $4.30 | 352 | 7.8 | $ | 4.13 | 224 | $ | 4.1 | ||||||||||
$4.31 - $4.99 | 40 | 8.2 | $ | 4.51 | 22 | $ | 4.55 | ||||||||||
$5.00 - $7.62 | 315 | 6.8 | $ | 6.67 | 315 | $ | 6.67 | ||||||||||
Total | 894 | 7.3 | $ | 4.96 | 637 | $ | 5.31 | ||||||||||
Summary of restricted stock activity | Activity with respect to restricted stock is summarized as follows: | ||||||||||||||||
Number of Shares (000's) | Weighted Avg. | ||||||||||||||||
Grant Date Fair | |||||||||||||||||
Value | |||||||||||||||||
Unvested at December 31, 2014 | 504 | $ | 3.68 | ||||||||||||||
Granted | 50 | $ | 4.01 | ||||||||||||||
Vested | (21 | ) | $ | 3.2 | |||||||||||||
Forfeited | (10 | ) | $ | 3.2 | |||||||||||||
Unvested at March 31, 2015 | 523 | $ | 3.74 | ||||||||||||||
Employee | Warrant | |||||||||||||||||
Stock based compensation | |||||||||||||||||
Schedule of assumptions used in calculating fair value of options using the Black Scholes Merton option-pricing model | The assumptions used in calculating the fair value of employee common stock options and warrants granted during the three months ended March 31, 2014, using the Black-Scholes-Merton option-pricing model are set forth in the following table: | ||||||||||||||||
Three Months Ended March 31, | |||||||||||||||||
2014 | |||||||||||||||||
Dividend yield | — | ||||||||||||||||
Expected volatility | 51 | % | |||||||||||||||
Risk-free interest rate | 1.73 | % | |||||||||||||||
Expected term | 5.2 years | ||||||||||||||||
Summary of common stock warrants activity | Activity with respect to employee common stock warrants is summarized as follows: | ||||||||||||||||
Number of | Weighted- | Weighted- | Aggregate | ||||||||||||||
Shares (000's) | Average | Average | Intrinsic | ||||||||||||||
Exercise | Remaining | Value (in 000’s) | |||||||||||||||
Price | Contractual | ||||||||||||||||
Term (in years) | |||||||||||||||||
Outstanding, December 31, 2014 | 594 | $ | 4.15 | ||||||||||||||
Granted | — | $ | — | ||||||||||||||
Exercised | (7 | ) | $ | 2.24 | |||||||||||||
Forfeited | — | $ | — | ||||||||||||||
Expired | — | $ | — | ||||||||||||||
Outstanding, March 31, 2015 | 587 | $ | 4.17 | 7.6 | $ | 206 | |||||||||||
Vested at March 31, 2015 | 287 | $ | 3.83 | 5.6 | $ | 206 | |||||||||||
Nonemployee | Warrant | |||||||||||||||||
Stock based compensation | |||||||||||||||||
Summary of common stock warrants activity | Activity with respect to non-employee common stock warrants is summarized as follows: | ||||||||||||||||
Number of | Weighted- | Weighted- | Aggregate | ||||||||||||||
Shares (000's) | Average | Average | Intrinsic | ||||||||||||||
Exercise | Remaining | Value (000's) | |||||||||||||||
Price | Contractual | ||||||||||||||||
Term (in years) | |||||||||||||||||
Outstanding, December 31, 2014 | 2,123 | $ | 3.26 | ||||||||||||||
Granted | — | $ | — | ||||||||||||||
Exercised | (444 | ) | $ | 3.81 | |||||||||||||
Forfeited | — | $ | — | ||||||||||||||
Expired | — | $ | — | ||||||||||||||
Outstanding, March 31, 2015 | 1,679 | $ | 3.11 | 3.2 | $ | 2,136 | |||||||||||
Vested at March 31, 2015 | 1,483 | $ | 2.99 | 3 | $ | 2,069 | |||||||||||
Variable_Interest_Entities_Tab
Variable Interest Entities (Tables) (Riverchase Village Facility) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Riverchase Village Facility | |||||||||
Variable interest entities | |||||||||
Summary of assets and liabilities of the variable interest entities included in the consolidated balance sheets | The following summarizes the assets and liabilities of the variable interest entity included in the consolidated balance sheets: | ||||||||
(Amounts in 000’s) | 31-Mar-15 | 31-Dec-14 | |||||||
Cash | $ | — | $ | — | |||||
Assets of variable interest entity held for sale | 5,954 | 5,924 | |||||||
Other assets | 337 | 343 | |||||||
Total assets | $ | 6,291 | $ | 6,267 | |||||
Accounts payable | $ | 1,911 | $ | 1,923 | |||||
Accrued expenses | 914 | 651 | |||||||
Current portion of notes payable | 177 | 177 | |||||||
Liabilities of variable interest entity held for sale | 5,958 | 5,956 | |||||||
Non-controlling interest | (2,669 | ) | (2,440 | ) | |||||
Total liabilities and non-controlling interest | $ | 6,291 | $ | 6,267 | |||||
Significant_Accounting_Policie2
Significant Accounting Policies (Details Textual) (USD $) | 3 Months Ended | ||
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 |
segment | |||
bed | |||
facility | |||
Concentration Risk [Line Items] | |||
Number of facilities | 31 | ||
Number of skilled nursing facilities | 28 | ||
Number of assisted living facilities | 2 | ||
Number of independent living and senior housing facilities | 1 | ||
Number of units in facilities | 3,300 | ||
Number of facilities owned and operated | 22 | ||
Operating leases, number of skilled nursing facilities leased, operated by the company | 6 | ||
Number of facilities managed | 3 | ||
Number of sublease agreements executed, owned by company | 3 | ||
Number of sublease agreements executed, leased by company | 5 | ||
Number of reportable segments | 1 | ||
Concentration risk, percentage | 83.80% | 84.50% | |
Patient care receivables, estimated allowance for uncollectible accounts | $7.70 | $6.70 | |
OKLAHOMA | |||
Concentration Risk [Line Items] | |||
Number of units under agreement to sale | 102 |
Reconciliation_of_Net_Income_L
Reconciliation of Net Income (Loss) for Continuing and Discontinued Operations (Details) (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Income (loss) | ||
(Loss) income from continuing operations | ($3,842) | ($2,598) |
Net loss attributable to noncontrolling interests | 230 | 173 |
Net loss attributable to AdCare Health Systems, Inc. Common Stockholders | -5,665 | -2,996 |
Preferred stock dividend | -646 | -646 |
Income (loss) from discontinued operations, net of tax | -1,407 | 75 |
Shares | ||
Basic (loss) income (in shares) | 19,218 | 16,916 |
Diluted (loss) income (in shares) | 19,218 | 16,916 |
Per Share | ||
Basic loss from continuing operations (in dollars per share) | ($0.22) | ($0.18) |
Diluted loss from continuing operations (in dollars per share) | ($0.22) | ($0.18) |
Basic (loss) income from discontinued operations (in dollars per share) | ($0.07) | $0 |
Diluted (loss) income from discontinued operations (in dollars per share) | ($0.07) | $0 |
Basic loss (in dollars per share) | ($0.29) | ($0.18) |
Diluted net income (loss) (in dollars per share) | ($0.29) | ($0.18) |
Continuing Operations | ||
Income (loss) | ||
(Loss) income from continuing operations | -3,842 | -2,598 |
Net loss attributable to noncontrolling interests | 230 | 173 |
Net loss attributable to AdCare Health Systems, Inc. Common Stockholders | -3,612 | -2,425 |
Preferred stock dividend | -646 | -646 |
Diluted income (loss) | -4,258 | -3,071 |
Shares | ||
Basic (loss) income (in shares) | 19,218 | 16,916 |
Diluted (loss) income (in shares) | 19,218 | 16,916 |
Per Share | ||
Basic loss from continuing operations (in dollars per share) | ($0.19) | ($0.14) |
Preferred stock dividend (in dollars per share) | ($0.03) | ($0.04) |
Diluted loss from continuing operations (in dollars per share) | ($0.22) | ($0.18) |
Discontinued Operations | ||
Income (loss) | ||
Income (loss) from discontinued operations, net of tax | ($1,407) | $75 |
Shares | ||
Basic (loss) income (in shares) | 19,218 | 16,916 |
Diluted (loss) income (in shares) | 19,218 | 16,916 |
Per Share | ||
Basic (loss) income from discontinued operations (in dollars per share) | ($0.07) | $0 |
Diluted (loss) income from discontinued operations (in dollars per share) | ($0.07) | $0 |
Antidilutive_Securities_Detail
Anti-dilutive Securities (Details) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Anti-dilutive securities outstanding that were excluded from the computation | ||
Total anti-dilutive securities (in shares) | 6,964 | 9,059 |
Stock options | ||
Anti-dilutive securities outstanding that were excluded from the computation | ||
Total anti-dilutive securities (in shares) | 894 | 1,758 |
Outstanding Warrants - employee | ||
Anti-dilutive securities outstanding that were excluded from the computation | ||
Total anti-dilutive securities (in shares) | 587 | 1,876 |
Outstanding Warrants - nonemployee | ||
Anti-dilutive securities outstanding that were excluded from the computation | ||
Total anti-dilutive securities (in shares) | 1,679 | 1,019 |
Subordinated Convertible Promissory Notes | ||
Anti-dilutive securities outstanding that were excluded from the computation | ||
Total anti-dilutive securities (in shares) | 3,804 | 4,406 |
Liquidity_and_Profitability_De
Liquidity and Profitability (Details Textual) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Oct. 22, 2012 | Apr. 30, 2015 | Apr. 13, 2015 | |
building | |||||||||
variable_interest_entity | |||||||||
facility | |||||||||
Management's plan for increasing liquidity and profitability | |||||||||
Cash and cash equivalents | $10,680,000 | $16,741,000 | $10,735,000 | $19,374,000 | |||||
Restricted cash and investments | 8,072,000 | 8,777,000 | |||||||
Number of facilities held-for-sale | 1 | ||||||||
Number of assets held-for-sale | 3 | ||||||||
Number of variable interest entities held for sale | 1 | ||||||||
Cash flow from operations and other working capital changes | 324,000 | -5,005,000 | |||||||
Total indebtedness | 151,771,000 | 151,359,000 | |||||||
Current debt | 29,700,000 | ||||||||
Debt, current | 17,602,000 | 22,113,000 | |||||||
Maturities from 2015 to 2017 | 67,300,000 | ||||||||
Preferred stock, shares issued | 950,000 | 950,000 | |||||||
Preferred stock issued | 20,392,000 | 20,392,000 | |||||||
Convertible debt issued in 2012 | |||||||||
Management's plan for increasing liquidity and profitability | |||||||||
Total indebtedness | 7,500,000 | ||||||||
Convertible Notes Payable | Notes Due April 2017 | |||||||||
Management's plan for increasing liquidity and profitability | |||||||||
Debt instrument, principal amount | 8,500,000 | ||||||||
Fixed interest rate (as a percent) | 10.00% | ||||||||
Convertible Debt | |||||||||
Management's plan for increasing liquidity and profitability | |||||||||
Number of debt instruments held | 2 | ||||||||
Convertible Debt | Convertible debt issued in 2012 | |||||||||
Management's plan for increasing liquidity and profitability | |||||||||
Total indebtedness | 7,500,000 | ||||||||
Number of debt instruments held | 1 | ||||||||
Conversion price (in dollars per share) | $3.97 | ||||||||
Stock dividend (as a percent) | 5.00% | ||||||||
Convertible Debt | Convertible Subordinated Promissory Notes Issued in March 2014 | |||||||||
Management's plan for increasing liquidity and profitability | |||||||||
Conversion price (in dollars per share) | $4.50 | ||||||||
Convertible Debt | Convertible Subordinated Promissory Notes Issued in March 2015 | |||||||||
Management's plan for increasing liquidity and profitability | |||||||||
Debt instrument, principal amount | 1,700,000 | ||||||||
Conversion price (in dollars per share) | $4.25 | ||||||||
Senior Debt, Bond and Mortgage Indebtedness | |||||||||
Management's plan for increasing liquidity and profitability | |||||||||
Debt of held for sale entities | 12,100,000 | ||||||||
Revolver Debt, Bonds and Mortgage Indebtedness | |||||||||
Management's plan for increasing liquidity and profitability | |||||||||
Debt, current | 9,300,000 | ||||||||
Scenario, Forecast | |||||||||
Management's plan for increasing liquidity and profitability | |||||||||
Proceeds from sale of asset, difference between the cash inflow and the related obligation on the asset, anticipated | 600,000 | ||||||||
Proceeds from issuance of debt | 2,700,000 | 2,500,000 | |||||||
Cash flow from operations and other working capital changes | 1,500,000 | ||||||||
Expected disbursements | 6,800,000 | ||||||||
Subsequent Event | Convertible Debt | Convertible Subordinated Promissory Notes Issued in March 2015 | |||||||||
Management's plan for increasing liquidity and profitability | |||||||||
Debt instrument, principal amount | 6,015,000 | ||||||||
Redeemable Preferred Stock | Subsequent Event | |||||||||
Management's plan for increasing liquidity and profitability | |||||||||
Preferred stock, shares issued | 575,000 | ||||||||
Share Price | $25.75 | ||||||||
Preferred stock issued | $13,500,000 |
Restricted_Cash_Escrow_Deposit
Restricted Cash, Escrow Deposits and Investments (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Restricted Cash and Investments [Abstract] | ||
HUD escrow deposits | $321 | $289 |
Lender's collection account | 391 | 35 |
Current replacement reserves | 133 | 9 |
HUD current replacement reserves | 637 | 637 |
Collateral cash and certificates of deposit | 1,758 | 2,302 |
Property tax escrow | 63 | 49 |
Total current portion | 3,303 | 3,321 |
HUD replacement reserves | 1,047 | 1,074 |
Reserves for capital improvements | 256 | 936 |
Restricted investments for other debt obligations | 3,466 | 3,446 |
Total noncurrent portion | 4,769 | 5,456 |
Total restricted cash and investments | $8,072 | $8,777 |
Intangible_Assets_and_Goodwill2
Intangible Assets and Goodwill (Intangible Assets) (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 |
Finite-lived Intangible Assets [Roll Forward] | ||
Gross | $48,243 | $48,243 |
Accumulated amortization | -9,067 | -8,592 |
Net carrying amount | 39,176 | 39,651 |
Amortization expense | -475 | |
Bed Licenses (included in property and equipment) | ||
Finite-lived Intangible Assets [Roll Forward] | ||
Gross | 36,948 | 36,948 |
Accumulated amortization | -4,163 | -3,855 |
Net carrying amount | 32,785 | 33,093 |
Amortization expense | -308 | |
Lease Rights | ||
Finite-lived Intangible Assets [Roll Forward] | ||
Gross | 8,824 | 8,824 |
Accumulated amortization | -4,904 | -4,737 |
Net carrying amount | 3,920 | 4,087 |
Amortization expense | -167 | |
Bed Licenses - Separable | ||
Finite-lived Intangible Assets [Roll Forward] | ||
Gross | 2,471 | 2,471 |
Accumulated amortization | 0 | 0 |
Net carrying amount | 2,471 | 2,471 |
Amortization expense | $0 |
Property_and_Equipment_Details
Property and Equipment (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 |
Property, Plant and Equipment | ||
Property and equipment, gross | 155,278 | $156,860 |
Less: Accumulated depreciation and amortization expense | 22,284 | 21,275 |
Property and equipment, net | 132,994 | 135,585 |
Buildings and improvements | ||
Property, Plant and Equipment | ||
Property and equipment, gross | 131,452 | 132,842 |
Buildings and improvements | Minimum | ||
Property, Plant and Equipment | ||
Estimated useful lives | 5 years | |
Buildings and improvements | Maximum | ||
Property, Plant and Equipment | ||
Estimated useful lives | 40 years | |
Equipment | ||
Property, Plant and Equipment | ||
Property and equipment, gross | 13,427 | 13,616 |
Equipment | Minimum | ||
Property, Plant and Equipment | ||
Estimated useful lives | 2 years | |
Equipment | Maximum | ||
Property, Plant and Equipment | ||
Estimated useful lives | 10 years | |
Land | ||
Property, Plant and Equipment | ||
Property and equipment, gross | 7,432 | 7,437 |
Computer related | ||
Property, Plant and Equipment | ||
Property and equipment, gross | 2,921 | 2,913 |
Computer related | Minimum | ||
Property, Plant and Equipment | ||
Estimated useful lives | 2 years | |
Computer related | Maximum | ||
Property, Plant and Equipment | ||
Estimated useful lives | 10 years | |
Construction in process | ||
Property, Plant and Equipment | ||
Property and equipment, gross | 46 | $52 |
Intangible_Assets_and_Goodwill3
Intangible Assets and Goodwill (Expected Amortization Expense for all Definite Lived Intangibles) (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total expected amortization expense | $3,920 | $4,087 |
Bed Licenses (included in property and equipment) | ||
Finite-Lived Intangible Assets [Line Items] | ||
2015 | 924 | |
2016 | 1,232 | |
2017 | 1,232 | |
2018 | 1,232 | |
2019 | 1,232 | |
Thereafter | 26,933 | |
Total expected amortization expense | 32,785 | |
Lease Rights | ||
Finite-Lived Intangible Assets [Line Items] | ||
2015 | 500 | |
2016 | 667 | |
2017 | 667 | |
2018 | 667 | |
2019 | 667 | |
Thereafter | 752 | |
Total expected amortization expense | $3,920 |
Property_and_Equipment_Details1
Property and Equipment (Details Textual) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Property, Plant and Equipment [Abstract] | ||
Total depreciation and amortization | $1.70 | |
Depreciation and amortization | 1.8 | |
Depreciation and amortization expense recognized in loss from discontinued operations | $0.02 | $0.20 |
Intangible_Assets_and_Goodwill4
Intangible Assets and Goodwill Carrying Amount of Goodwill (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Goodwill | $5,023 | $5,023 |
Accumulated impairment losses | -799 | -799 |
Total | $4,224 | $4,224 |
Leases_Operating_Leases_Detail
Leases - Operating Leases (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
facility | ||
Operating Leased Assets [Line Items] | ||
Number of skilled nursing facilities under non-cancelable operating leases | 11 | |
Operating leases, number of skilled nursing facilities leased, operated by the company | 6 | |
Facility rent expense | $1,931,000 | $1,659,000 |
Rent expense from discontinued operations | 400,000 | |
Future minimum lease payments | ||
2015 | 5,113,000 | |
2016 | 6,688,000 | |
2017 | 6,593,000 | |
2018 | 6,539,000 | |
2019 | 6,060,000 | |
Thereafter | 6,637,000 | |
Total | 37,630,000 | |
Minimum | ||
Operating Leased Assets [Line Items] | ||
Operating leases, term of contract | 10 years | |
Maximum | ||
Operating Leased Assets [Line Items] | ||
Operating leases, term of contract | 12 years | |
Lease Ending 2020 | ||
Operating Leased Assets [Line Items] | ||
Number of skilled nursing facilities under non-cancelable operating leases | 8 | |
Operating leases, term of contract | 10 years | |
Lease Ending 2022 | ||
Operating Leased Assets [Line Items] | ||
Number of skilled nursing facilities under non-cancelable operating leases | 2 | |
Operating leases, term of contract | 12 years | |
Number of renewal terms | 2 | |
Renewal term (in years) | 10 years | |
Capital expenditure per licensed bed per lease year at each facility | 375 | |
Capital expenditure per year for both facilities | $100,000 |
Leases_Leased_and_Subleased_Fa
Leases - Leased and Subleased Facilities to Third-Party Operators (Details) (USD $) | 3 Months Ended | 0 Months Ended | ||||||||
Mar. 31, 2015 | Feb. 18, 2015 | Jan. 16, 2015 | Jan. 31, 2015 | Mar. 17, 2015 | Feb. 27, 2015 | Mar. 20, 2015 | Apr. 29, 2015 | 1-May-15 | Apr. 30, 2015 | |
facility | facility | facility | facility | subsidiary | facility | subsidiary | facility | facility | ||
lease_agreement | facility | lease_agreement | ||||||||
Operating Leased Assets [Line Items] | ||||||||||
Number of sublease agreements executed | 8 | |||||||||
Number of sublease agreements executed, owned by company | 3 | |||||||||
Number of sublease agreements executed, leased by company | 5 | |||||||||
Number of skilled nursing facilities under non-cancelable operating leases | 11 | |||||||||
Number of skilled nursing facilities | 28 | |||||||||
College Park Sublessor | ||||||||||
Operating Leased Assets [Line Items] | ||||||||||
Annual rent in the first year | $600,000 | |||||||||
Renewal term (in years) | 5 years | |||||||||
Annual escalation of rental payments | 12,000 | |||||||||
Autumn Breeze Sublessor | ||||||||||
Operating Leased Assets [Line Items] | ||||||||||
Annual rent in the first year | 800,000 | |||||||||
Renewal term (in years) | 5 years | |||||||||
Annual escalation of rental payments | 12,000 | |||||||||
Arkansas | Aria Sublessor | ||||||||||
Operating Leased Assets [Line Items] | ||||||||||
Number of skilled nursing facilities under non-cancelable operating leases | 10 | |||||||||
Annual rent in the first year | 5,300,000 | |||||||||
Escalation percentage through initial term, as a percent | 0.02 | |||||||||
Escalation percentage through renewal term, as a percent | 0.03 | |||||||||
Initial lease term (in years) | 10 years | |||||||||
Renewal term (in years) | 5 years | |||||||||
Georgia | ||||||||||
Operating Leased Assets [Line Items] | ||||||||||
Number of skilled nursing facilities under non-cancelable operating leases | 1 | 2 | ||||||||
Number of sublease agreements | 2 | |||||||||
Annual rent in the first year | 3,900,000 | |||||||||
Escalation percentage through initial term, as a percent | 0.01 | |||||||||
Escalation percentage through renewal term, as a percent | 0.02 | |||||||||
Georgia | Autumn Breeze Sublessor | ||||||||||
Operating Leased Assets [Line Items] | ||||||||||
Number of skilled nursing facilities under non-cancelable operating leases | 1 | |||||||||
Georgia | LaGrange Sublessor | ||||||||||
Operating Leased Assets [Line Items] | ||||||||||
Number of skilled nursing facilities under non-cancelable operating leases | 1 | |||||||||
Annual rent in the first year | 1,000,000 | |||||||||
Escalation percentage through initial term, as a percent | 0.03 | |||||||||
Initial term of annual rent (in years) | 2 years | |||||||||
North Carolina and South Carolina | ||||||||||
Operating Leased Assets [Line Items] | ||||||||||
Annual rent in the first year | 1,800,000 | |||||||||
Escalation percentage through initial term, as a percent | 0.03 | |||||||||
Number of subsidiaries entered into sublease agreement | 3 | |||||||||
Number of skilled nursing facilities | 1 | |||||||||
Initial lease term (in years) | 15 years | |||||||||
Renewal term (in years) | 5 years | |||||||||
South Carolina | ||||||||||
Operating Leased Assets [Line Items] | ||||||||||
Number of skilled nursing facilities under non-cancelable operating leases | 2 | 2 | ||||||||
Escalation percentage through renewal term, as a percent | 0.2 | |||||||||
Subsequent Event | ||||||||||
Operating Leased Assets [Line Items] | ||||||||||
Number of subsidiaries entered into sublease agreement | 2 | |||||||||
Subsequent Event | Arkansas | Aria Sublessor | ||||||||||
Operating Leased Assets [Line Items] | ||||||||||
Number of skilled nursing facilities under non-cancelable operating leases | 8 | |||||||||
Escalation percentage through initial term, as a percent | 0.02 | |||||||||
Escalation percentage through renewal term, as a percent | 0.03 | |||||||||
Number of skilled nursing facilities leases terminated | 2 | |||||||||
Operating Lease, Number of Leases Agreements, Active and Commenced | 8 | |||||||||
Operating Leases, monthly rental expense | 29,500 | |||||||||
Renewal term (in years) | 5 years | |||||||||
Aria Health Consulting LLC | Subsequent Event | Aria Sublessor | ||||||||||
Operating Leased Assets [Line Items] | ||||||||||
Payments for lease inducement fees | $2,000,000 |
Accrued_Expenses_Details
Accrued Expenses (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Payables and Accruals [Abstract] | ||
Accrued payroll related | $6,521 | $6,915 |
Accrued employee benefits | 3,987 | 3,405 |
Real estate and other taxes | 1,613 | 1,335 |
Other accrued expenses | 5,353 | 3,998 |
Total accrued expenses | $17,474 | $15,653 |
Notes_Payable_and_Other_Debt_D
Notes Payable and Other Debt (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Debt Instrument [Line Items] | ||
Total notes payable and other debt | $151,771 | $151,359 |
Less: portion included in liabilities of disposal group held for sale (a),(c) | 17,602 | 22,113 |
Liabilities of disposal group held for sale | 6,180 | 5,197 |
Liabilities of variable interest entity held for sale | 5,958 | 5,956 |
Notes payable and other debt, net of current portion | 122,031 | 118,093 |
Line of Credit | ||
Debt Instrument [Line Items] | ||
Total notes payable and other debt | 5,070 | 6,832 |
Senior debt - guaranteed by HUD | ||
Debt Instrument [Line Items] | ||
Total notes payable and other debt | 25,883 | 26,022 |
Senior debt - guaranteed by USDA | ||
Debt Instrument [Line Items] | ||
Total notes payable and other debt | 26,964 | 27,128 |
Senior debt - guaranteed by SBA | ||
Debt Instrument [Line Items] | ||
Total notes payable and other debt | 3,665 | 3,703 |
Senior debt - bonds, net of discount | ||
Debt Instrument [Line Items] | ||
Total notes payable and other debt | 12,972 | 12,967 |
Senior debt - other mortgage indebtedness | ||
Debt Instrument [Line Items] | ||
Total notes payable and other debt | 60,365 | 60,277 |
Other debt | ||
Debt Instrument [Line Items] | ||
Total notes payable and other debt | 1,167 | 430 |
Convertible debt issued in 2012 | ||
Debt Instrument [Line Items] | ||
Total notes payable and other debt | 7,500 | |
Convertible debt issued in 2014 | ||
Debt Instrument [Line Items] | ||
Total notes payable and other debt | 849 | 6,500 |
Convertible debt issued in 2015 | ||
Debt Instrument [Line Items] | ||
Total notes payable and other debt | 7,336 | 0 |
Convertible Debt | Convertible debt issued in 2012 | ||
Debt Instrument [Line Items] | ||
Total notes payable and other debt | 7,500 | |
Riverchase Village Facility | Senior debt - bonds, net of discount | ||
Debt Instrument [Line Items] | ||
Total notes payable and other debt | 6,000 | |
Liabilities of variable interest entity held for sale | $6,000 | $6,000 |
Notes_Payable_and_Other_Debt_S
Notes Payable and Other Debt (Scheduled Maturities) (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Debt Instrument [Line Items] | ||
Debt Instrument Unamortized Discount Current | $172 | |
2016 | 29,912 | |
2017 | 50,287 | |
2018 | 11,263 | |
2019 | 1,778 | |
2020 | 1,866 | |
Thereafter | 57,053 | |
Subtotal | 152,159 | |
Less: unamortized discounts | -388 | |
Total notes payable and other debt | 151,771 | 151,359 |
Senior Debt Other Mortgage Indebtedness | ||
Debt Instrument [Line Items] | ||
Total notes payable and other debt | 5,000 | |
Senior debt - bonds, net of discount | ||
Debt Instrument [Line Items] | ||
Total notes payable and other debt | 12,972 | 12,967 |
Riverchase Village Facility | Senior debt - bonds, net of discount | ||
Debt Instrument [Line Items] | ||
Total notes payable and other debt | 6,000 | |
Companion Specialized Care Center | Senior Debt Other Mortgage Indebtedness | ||
Debt Instrument [Line Items] | ||
Total notes payable and other debt | 5,200 | |
Discontinued Operations, Held-for-sale [Member] | Companion Specialized Care Center | Senior Debt Other Mortgage Indebtedness | ||
Debt Instrument [Line Items] | ||
Total notes payable and other debt | $1,000 | |
Number of Facilities | 1 | |
Number of Office Buildings, Classified as Liabilities of Disposal Group Help for Sale | 2 |
Notes_Payable_and_Other_Debt_C
Notes Payable and Other Debt (Credit-related instruments) (Details) (USD $) | 3 Months Ended | ||
Mar. 31, 2015 | Dec. 31, 2014 | Apr. 30, 2015 | |
Line of Credit Facility [Line Items] | |||
Total indebtedness | $151,771,000 | $151,359,000 | |
Gemino Northwest | Line of Credit | |||
Line of Credit Facility [Line Items] | |||
Total indebtedness | 2,274,000 | ||
Financial Covenant Required, Fixed Charge Coverage Ratio | 0.8 | ||
Financial Covenant Achieved, Fixed Charge Coverage Ratio | 0.58 | ||
Future Financial Covenant Required, Fixed Charge Coverage Ratio | 1.1 | ||
Private Bank | Line of Credit | |||
Line of Credit Facility [Line Items] | |||
Total indebtedness | 1,550,000 | ||
Financial Covenant Required, Coverage of Rent and Debt Services | 1.25 | ||
Financial Covenant Achieved, Coverage of Rent and Debt Services | 0.65 | ||
Financial Covenant Required, TTM Fixed Charge Coverage Ratio | 1.05 | ||
Financial Covenant Achieved, TTM Fixed Charge Coverage Ratio | 0.93 | ||
Private Bank | Valley River Nursing LLC, Park Heritage Nursing LLC, Benton Nursing LLC | Senior Notes | |||
Line of Credit Facility [Line Items] | |||
Total indebtedness | 10,946,000 | ||
Financial Covenant Required, Fixed Charge Coverage Ratio | 1.05 | ||
Financial Covenant Achieved, Fixed Charge Coverage Ratio | 0.76 | ||
Financial Covenant Required, Minimum EBITDAR | 450,000 | ||
Financial Covenant Achieved, Minimum EBITDAR | 59,000 | ||
Private Bank | APH&R Property Holdings, LLC; Northridge HC&R Property Holdings, LLC; Woodland Hills HC Property Holdings, LLC | Senior Notes | |||
Line of Credit Facility [Line Items] | |||
Total indebtedness | 11,982,000 | ||
Financial Covenant Required, DSCR | 1.75 | ||
Financial Covenant Achieved, DSCR | 0.53 | ||
Financial Covenant Required, Minimum Quarterly Rent | 290,000 | ||
Financial Covenant Achieved, Minimum Quarterly Rent | 177,000 | ||
Financial Covenant Required, Minimum Operator Fixed Charge Coverage Ratio | 1.1 | ||
Financial Covenant Achieved, Minimum Operator Fixed Charge Coverage Ratio | 0.57 | ||
Private Bank | Georgetown HC&R Property Holdings, LLC; Sumter Valley Property Holdings, LLC | Senior Notes | |||
Line of Credit Facility [Line Items] | |||
Total indebtedness | 9,285,000 | ||
Financial Covenant Required, Minimum Quarterly Rent | 235,000 | ||
Financial Covenant Achieved, Minimum Quarterly Rent | 199,000 | ||
Private Bank | Little Rock HC&R Nursing, LLC | Senior Notes | |||
Line of Credit Facility [Line Items] | |||
Total indebtedness | 11,570,000 | ||
Financial Covenant Required, Minimum EBITDAR | 358,000 | ||
Financial Covenant Achieved, Minimum EBITDAR | 42,000 | ||
Financial Covenant Required, Minimum Operator Fixed Charge Coverage Ratio | 1.05 | ||
Financial Covenant Achieved, Minimum Operator Fixed Charge Coverage Ratio | 0.87 | ||
Contemporary Healthcare Capital | CSCC Nursing LLC | Line of Credit | |||
Line of Credit Facility [Line Items] | |||
Total indebtedness | 5,000,000 | ||
Debt Instrument, Financial Covenant Required, Minimum Occupancy | 0.7 | ||
Financial Covenant Achieved, Maximum Occupancy | 0.64 | ||
Contemporary Healthcare Capital | CSCC Nursing LLC | Notes Payable | |||
Line of Credit Facility [Line Items] | |||
Total indebtedness | 197,000 | ||
Financial Covenant Required, Minimum Implied Current Ratio | 1 | ||
Financial Covenant Achieved, Minimum Implied Current Ratio | 0.95 | ||
Financial Covenant Required, DSCR | 1.15 | ||
Financial Covenant Achieved, DSCR | -0.76 | ||
Minimum | |||
Line of Credit Facility [Line Items] | |||
Number of credit facilities outstanding | 46 | ||
Convertible Subordinated Promissory Notes Issued in March 2015 | Convertible Debt | |||
Line of Credit Facility [Line Items] | |||
Debt instrument, principal amount | 1,700,000 | ||
Subsequent Event | Convertible Subordinated Promissory Notes Issued in March 2015 | Convertible Debt | |||
Line of Credit Facility [Line Items] | |||
Debt instrument, principal amount | $6,015,000 |
Notes_Payable_and_Other_Debt_C1
Notes Payable and Other Debt (Credit Facilities) (Details) (USD $) | 0 Months Ended | ||||||
Jan. 30, 2015 | Jan. 31, 2015 | Sep. 20, 2012 | Feb. 25, 2015 | Apr. 30, 2015 | Mar. 31, 2015 | 30-May-13 | |
subsidiary | |||||||
Metro City Bank | |||||||
Line of Credit Facility [Line Items] | |||||||
Repayments of loan | $9,000,000 | ||||||
Gemino Northwest Credit Facility | |||||||
Line of Credit Facility [Line Items] | |||||||
Maximum borrowing capacity | 1,500,000 | 1,000,000 | |||||
Collateral monitoring fee as percentage of outstanding balance (percent) | 1.00% | ||||||
Fee as percent of unused portion of debt (percent) | 0.50% | ||||||
Amount outstanding | 1,000,000 | ||||||
Gemino Bonterra Credit Facility | |||||||
Line of Credit Facility [Line Items] | |||||||
Maximum borrowing capacity | 2,000,000 | 2,000,000 | |||||
Amount outstanding | 1,300,000 | ||||||
LIBOR | Gemino Northwest Credit Facility | |||||||
Line of Credit Facility [Line Items] | |||||||
Variable interest rate (percent) | 4.75% | ||||||
Minimum | LIBOR | Gemino Bonterra Credit Facility | |||||||
Line of Credit Facility [Line Items] | |||||||
Variable interest rate (percent) | 4.75% | ||||||
Maximum | LIBOR | Gemino Bonterra Credit Facility | |||||||
Line of Credit Facility [Line Items] | |||||||
Variable interest rate (percent) | 5.00% | ||||||
Sumter Valley and Georgetown | Line of Credit | Private Bank | Secured Debt | |||||||
Line of Credit Facility [Line Items] | |||||||
Maximum borrowing capacity | 9,300,000 | ||||||
Number of wholly-owned subsidiaries entered into loan agreement | 2 | ||||||
Sumter Valley and Georgetown | Line of Credit | LIBOR | Private Bank | Secured Debt | |||||||
Line of Credit Facility [Line Items] | |||||||
Variable interest rate (percent) | 4.25% | ||||||
Little Rock Northridge and Woodland Hills and Abington Place Health and Rehab Center | Line of Credit | Private Bank | Secured Debt | |||||||
Line of Credit Facility [Line Items] | |||||||
Maximum borrowing capacity | 12,000,000 | 12,000,000 | |||||
Variable interest rate (percent) | 4.25% | ||||||
Amount outstanding | 12,000,000 | ||||||
Number of wholly-owned subsidiaries entered into loan agreement | 3 | ||||||
Repayments of loan | 12,000,000 | ||||||
Restricted assets | 2,000,134 | ||||||
Subsequent Event | Gemino Northwest Credit Facility | |||||||
Line of Credit Facility [Line Items] | |||||||
Repayments of loan | $1,000,000 |
Notes_Payable_and_Other_Debt_S1
Notes Payable and Other Debt (Senior Debt - Other Mortgage Indebtedness and Other Debt) (Details) (USD $) | 0 Months Ended | 1 Months Ended | 0 Months Ended | ||||
Feb. 25, 2015 | Mar. 31, 2014 | Mar. 28, 2014 | Apr. 03, 2015 | Mar. 31, 2015 | Dec. 28, 2012 | Apr. 30, 2015 | |
promissory_note | |||||||
Debt Instrument [Line Items] | |||||||
Current debt | $29,700,000 | ||||||
Key Bank Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Maximum borrowing capacity | 16,500,000 | ||||||
Repayments of loan | 12,000,000 | ||||||
First Insurance Funding | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, principal amount | 3,300,000 | ||||||
Monthly payment | 300,000 | ||||||
Fixed interest rate (as a percent) | 2.50% | ||||||
Commercial Insurance Premium Finance Security Agreements | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, principal amount | 400,000 | ||||||
Current debt | 400,000 | ||||||
Subsequent Event | Commercial Insurance Premium Finance Security Agreements | |||||||
Debt Instrument [Line Items] | |||||||
Fixed interest rate (as a percent) | 3.29% | ||||||
Abington Place Health and Rehab Center | Key Bank Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Repayments of loan | 3,400,000 | ||||||
KeyBank | Promissory Note | |||||||
Debt Instrument [Line Items] | |||||||
Number of promissory notes | 4 | ||||||
Proceeds from issuance of debt | $700,000 | ||||||
Amended KeyBank Promissory Notes | Subsequent Event | Promissory Note | |||||||
Debt Instrument [Line Items] | |||||||
Number of promissory notes | 5 |
Notes_Payable_and_Other_Debt_S2
Notes Payable and Other Debt (Subordinated Convertible Promissory Notes Issued in 2015) (Details) (Convertible Debt, USD $) | 3 Months Ended | |
Mar. 31, 2015 | Apr. 30, 2015 | |
day | ||
2015 Convertible Subordinated Notes Subscription Agreement | ||
Debt Conversion [Line Items] | ||
Debt instrument, principal amount | $8,500,000 | |
Convertible Subordinated Promissory Notes Issued in March 2015 | ||
Debt Conversion [Line Items] | ||
Debt instrument, principal amount | 1,700,000 | |
Conversion price (in dollars per share) | $4.25 | |
Maximum number of shares issued and issuable in respect of all 2015 Notes (shares) | 3,850,405 | |
Number of days written notice to prepay convertible debt | 60 days | |
Threshold trading days for volume-weight average price calculation | 10 | |
Debt instrument conversion obligation common stock weighted average price as percentage of conversion price | 125.00% | |
Default interest rate (percent) | 14.00% | |
Placement agent fee | 100,000 | |
Institutional Securities Corporation, an Affiliate of Doucet Asset Management, LLC | Convertible Subordinated Promissory Notes Issued in March 2015 | ||
Debt Conversion [Line Items] | ||
Percentage ownership | 5.00% | |
Subsequent Event | Convertible Subordinated Promissory Notes Issued in March 2015 | ||
Debt Conversion [Line Items] | ||
Debt instrument, principal amount | $6,015,000 |
Discontinued_Operations_Detail
Discontinued Operations (Details Textual) (USD $) | 3 Months Ended | 12 Months Ended | 0 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 | Jul. 01, 2014 | Jan. 21, 2015 |
bed | bed | building | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Number of units in facilities | 3,300 | |||
Home Health Business | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Impairment loss | ($1.80) | |||
Tulsa, Oklahoma | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Number of units in facilities | 102 | |||
Roswell, Georgia [Member] | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Number of buildings listed for sale | 2 |
Discontinued_Operations_Activi
Discontinued Operations Activity of Discontinued Operations (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Net gain (loss) from discontinued operations | ($1,407) | $75 |
Discontinued Operations | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Net gain (loss) from discontinued operations | -1,407 | 75 |
Discontinued Operations | Home Health Business | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Total revenues from discontinued operations | 718 | 9,421 |
Net gain (loss) from discontinued operations | -1,407 | 75 |
Interest expense, net from discontinued operations | $260 | $261 |
Discontinued_Operations_Assets
Discontinued Operations Assets and Liabilities of the Disposal Groups Held for Sale (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Assets held for sale | $7,231 | $5,813 |
Liabilities held for sale | 6,180 | 5,197 |
Home Health Business | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Property and equipment, net | 5,187 | 3,777 |
Other assets | 2,044 | 2,036 |
Assets held for sale | 7,231 | 5,813 |
Portion included in liabilities of disposal group held for sale | 5,983 | 5,000 |
Line of credit | 197 | 197 |
Liabilities held for sale | $6,180 | $5,197 |
Discontinued_Operations_Assets1
Discontinued Operations Assets and Liabilities of the Variable Interest Entity Held for Sale (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Assets held for sale | $7,231 | $5,813 |
Liabilities held for sale | 6,180 | 5,197 |
Riverchase | Riverchase Village Facility | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Property and equipment, net | 5,893 | 5,893 |
Other assets | 61 | 31 |
Assets held for sale | 5,954 | 5,924 |
Bonds payable | 5,958 | 5,956 |
Liabilities held for sale | $5,958 | $5,956 |
Stock_based_compensation_Detai
Stock based compensation (Details Textual) (USD $) | 3 Months Ended |
In Millions, except Share data, unless otherwise specified | Mar. 31, 2015 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of securities available for future issuance | 469,580 |
Warrants Term | 5 years |
Warrants granted (in shares) | 48,889 |
Exercise price (in dollars per share) | $4.50 |
Stock options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized compensation expense related to non-vested stock options | $0.30 |
Period for recognition for the unrecognized compensation | 1 year 11 months 12 days |
Restricted Stock | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Period for recognition for the unrecognized compensation | 2 years 6 months |
Unrecognized compensation expense related to non-vested stock | 1 |
2005 Stock Incentive Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Maximum number of shares of common stock which can be issued | 578,812 |
2011 Stock Incentive Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of plans | 2 |
Maximum number of shares of common stock which can be issued | 2,152,500 |
Warrant | Employee | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Period for recognition for the unrecognized compensation | 2 years 5 months 24 days |
Unrecognized compensation expense related to non-vested stock | $0.40 |
Warrants granted (in shares) | 0 |
Warrant | Nonemployee | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Warrants granted (in shares) | 0 |
Warrant | Nonemployee | Minimum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Warrants Term | 2 years |
Warrant | Nonemployee | Maximum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Warrants Term | 10 years |
Stock_Based_Compensation_Recog
Stock Based Compensation (Recognized Stock-based Compensation) (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Recognized stock based compensation | $203 | $513 |
Employee | Stock options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Recognized stock based compensation | 44 | 182 |
Employee | Board stock options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Recognized stock based compensation | 12 | 54 |
Nonemployee | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Recognized stock based compensation | 63 | 256 |
Nonemployee | Management restricted stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Recognized stock based compensation | 63 | 34 |
Nonemployee | Board restricted stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Recognized stock based compensation | 51 | 191 |
Warrant | Employee | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Recognized stock based compensation | 33 | 41 |
Warrant | Employee | Stock options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Recognized stock based compensation | 140 | 257 |
Warrant | Nonemployee | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Recognized stock based compensation | $0 | $11 |
Stock_Based_Compensation_Assum
Stock Based Compensation (Assumptions Used in Calculating the Fair Value of Common Stock Options and Warrants Granted) (Details) (Stock Options and Stock Warrants) | 3 Months Ended |
Mar. 31, 2014 | |
Employee | |
Weighted average significant assumptions used to estimate the fair value | |
Dividend yield | 0.00% |
Expected volatility | 51.00% |
Risk-free interest rate | 1.73% |
Expected term | 5 years 2 months 12 days |
Nonemployee | |
Weighted average significant assumptions used to estimate the fair value | |
Dividend yield | 0.00% |
Expected volatility | 51.00% |
Risk-free interest rate | 1.74% |
Expected term | 5 years |
Stock_Based_Compensation_Activ
Stock Based Compensation (Activity with Respect to Employee Stock Options) (Details) (Employee Stock Option, USD $) | 3 Months Ended |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2015 |
Employee Stock Option | |
Number of Shares | |
Outstanding at the beginning of the period (in shares) | 935 |
Granted (in shares) | 0 |
Exercised (in shares) | -3 |
Forfeited (in shares) | -10 |
Expired (in shares) | -28 |
Outstanding at the end of the period (in shares) | 894 |
Vested at the end of the period (in shares) | 637 |
Weighted Average Exercise Price | |
Outstanding at the beginning of the period (in dollars per share) | $4.91 |
Granted (in dollars per share) | $0 |
Exercised (in dollars per share) | $1.30 |
Forfeited (in dollars per share) | $4.06 |
Vested option expired (in dollars per share) | $4.03 |
Outstanding at the end of the period (in dollars per share) | $4.96 |
Vested at the end of the period (in dollars per share) | $5.31 |
Weighted Average Remaining Contract Life | |
Weighted- Average Remaining Contractual Term (in years) | 7 years 3 months 1 day |
Vested at the end of the period | 6 years 7 months |
Aggregate Intrinsic Value | |
Outstanding at the end of the period (in dollars) | $208 |
Vested at the end of the period (in dollars) | $130 |
Stock_Based_Compensation_Stock
Stock Based Compensation (Stock Options Outstanding, Vested and Expected to Vest and Related Details) (Details) (USD $) | 3 Months Ended |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2015 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number Outstanding (000's) | 894 |
Weighted Average Remaining Contractual Term (in years) | 7 years 3 months 12 days |
Weighted Average Exercise Price | $4.96 |
Vested and Expected to Vest (000's) | 637 |
Weighted Average Exercise Price | $5.31 |
$1.30 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number Outstanding (000's) | 13 |
Weighted Average Remaining Contractual Term (in years) | 0 years 7 months 6 days |
Weighted Average Exercise Price | $1.30 |
Vested and Expected to Vest (000's) | 13 |
Weighted Average Exercise Price | $1.30 |
Exercise price, maximum | $1.30 |
$1.31 - $3.99 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number Outstanding (000's) | 174 |
Weighted Average Remaining Contractual Term (in years) | 7 years 3 months 18 days |
Weighted Average Exercise Price | $3.91 |
Vested and Expected to Vest (000's) | 63 |
Weighted Average Exercise Price | $3.93 |
Exercise price, maximum | $3.99 |
Exercise price, minimum | $1.31 |
$4.00 - $4.30 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number Outstanding (000's) | 352 |
Weighted Average Remaining Contractual Term (in years) | 7 years 10 months |
Weighted Average Exercise Price | $4.13 |
Vested and Expected to Vest (000's) | 224 |
Weighted Average Exercise Price | $4.10 |
Exercise price, maximum | $4.30 |
Exercise price, minimum | $4 |
$4.31 - $4.99 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number Outstanding (000's) | 40 |
Weighted Average Remaining Contractual Term (in years) | 8 years 2 months 12 days |
Weighted Average Exercise Price | $4.51 |
Vested and Expected to Vest (000's) | 22 |
Weighted Average Exercise Price | $4.55 |
Exercise price, maximum | $4.99 |
Exercise price, minimum | $4.31 |
$5.00 - $7.62 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number Outstanding (000's) | 315 |
Weighted Average Remaining Contractual Term (in years) | 6 years 9 months 18 days |
Weighted Average Exercise Price | $6.67 |
Vested and Expected to Vest (000's) | 315 |
Weighted Average Exercise Price | $6.67 |
Exercise price, maximum | $7.62 |
Exercise price, minimum | $5 |
Stock_Based_Compensation_Activ1
Stock Based Compensation (Activity with Respect to Common Stock Warrants) (Details) (USD $) | 3 Months Ended |
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2015 |
Number of Shares | |
Granted (in shares) | 48,889 |
Employee | Warrant | |
Number of Shares | |
Outstanding at the beginning of the period (in shares) | 594,000 |
Granted (in shares) | 0 |
Exercised (in shares) | -7,000 |
Forfeited (in shares) | 0 |
Expired (in shares) | 0 |
Outstanding at the end of the period (in shares) | 587,000 |
Vested at the end of the period (in shares) | 287,000 |
Weighted Average Exercise Price | |
Outstanding at the beginning of the period (in dollars per share) | 4.15 |
Granted (in dollars per share) | 0 |
Exercised (in dollars per share) | 2.24 |
Forfeited (in dollars per share) | 0 |
Expired (in dollars per share) | 0 |
Outstanding at the end of the period (in dollars per share) | 4.17 |
Vested at the end of the period (in dollars per share) | 3.83 |
Weighted-Average Remaining Contract Term | |
Outstanding at the end of the period | 7 years 7 months 6 days |
Vested at the end of the period | 5 years 7 months 18 days |
Aggregate Intrinsic Value | |
Outstanding at the end of the period (in dollars) | 206 |
Vested at the end of the period (in dollars) | 206 |
Nonemployee | Warrant | |
Number of Shares | |
Outstanding at the beginning of the period (in shares) | 2,123,000 |
Granted (in shares) | 0 |
Exercised (in shares) | -444,000 |
Forfeited (in shares) | 0 |
Expired (in shares) | 0 |
Outstanding at the end of the period (in shares) | 1,679,000 |
Vested at the end of the period (in shares) | 1,483,000 |
Weighted Average Exercise Price | |
Outstanding at the beginning of the period (in dollars per share) | 3.26 |
Granted (in dollars per share) | 0 |
Exercised (in dollars per share) | 3.81 |
Forfeited (in dollars per share) | 0 |
Expired (in dollars per share) | 0 |
Outstanding at the end of the period (in dollars per share) | 3.11 |
Vested at the end of the period (in dollars per share) | 2.99 |
Weighted-Average Remaining Contract Term | |
Outstanding at the end of the period | 3 years 2 months 18 days |
Vested at the end of the period | 3 years 0 months 18 days |
Aggregate Intrinsic Value | |
Outstanding at the end of the period (in dollars) | 2,136 |
Vested at the end of the period (in dollars) | 2,069 |
Stock_Based_Compensation_Activ2
Stock Based Compensation (Activity with Respect to Restricted Stock) (Details) (Restricted Stock, USD $) | 3 Months Ended |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2015 |
Restricted Stock | |
Number of Shares | |
Unvested at the beginning of the period (in shares) | 504 |
Granted (in shares) | 50 |
Vested (in shares) | -21 |
Forfeited (in shares) | -10 |
Unvested at the end of the period (in shares) | 523 |
Weighted Avg. Grant Date Fair Value | |
Unvested at the beginning of the period (in dollars per share) | $3.68 |
Granted (in dollars per share) | $4.01 |
Vested (in dollars per share) | $3.20 |
Forfeited (in dollars per share) | $3.20 |
Unvested at the end of the period (in dollars per share) | $3.74 |
Variable_Interest_Entities_Det
Variable Interest Entities (Details Textual) (USD $) | 0 Months Ended | ||
Oct. 10, 2014 | 15-May-14 | Mar. 25, 2015 | |
bed | |||
Riverchase Village Facility | |||
Variable interest entities | |||
Number of beds in assisted living facility | 105 | ||
Provision for property tax | $92,323 | $92,323 | |
Riverchase | Affiliated Entity | |||
Variable interest entities | |||
Outstanding note receivable | 177,323 | ||
Riverchase | Senior debt - bonds, net of discount | Affiliated Entity | |||
Variable interest entities | |||
Repayments of debt | 85,000 | ||
Contract Termination | Vice Chairman | |||
Variable interest entities | |||
Notes payable | 615,986 | ||
Letter Agreement Second Amendment | Vice Chairman | |||
Variable interest entities | |||
Principal balance reduction, real property taxes due on assisted living facility | 92,323 | ||
Consulting fee payable | $255,000 |
Variable_Interest_Entities_Ass
Variable Interest Entities Assets and Liabilities of the Variable Interest Entity (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Variable interest entities | ||
Other assets | $529 | $569 |
Accounts payable | 16,564 | 16,434 |
Accrued expenses | 17,474 | 15,653 |
Non-controlling interest | -2,670 | -2,440 |
Riverchase Village Facility | ||
Variable interest entities | ||
Cash | 0 | 0 |
Assets of variable interest entity held for sale | 5,954 | 5,924 |
Other assets | 337 | 343 |
Total assets | 6,291 | 6,267 |
Accounts payable | 1,911 | 1,923 |
Accrued expenses | 914 | 651 |
Current portion of notes payable | 177 | 177 |
Liabilities of variable interest entity held for sale | 5,958 | 5,956 |
Non-controlling interest | -2,669 | -2,440 |
Total liabilities and non-controlling interest | $6,291 | $6,267 |
Commitments_and_Contingencies_
Commitments and Contingencies (Details Textual) (USD $) | 0 Months Ended | 3 Months Ended | 12 Months Ended | |||
In Millions, unless otherwise specified | Mar. 30, 2015 | Mar. 26, 2015 | Jun. 24, 2013 | Mar. 31, 2015 | Dec. 31, 2014 | Mar. 07, 2014 |
company | entity | bed | ||||
facility | ||||||
Legal Matters | ||||||
Number of entities controlled by Mr. and Mrs. Brogdon against which complaint filed in the District Court of Oklahoma County by Plaintiffs | 5 | |||||
Number of skilled nursing facilities owned by Mr. and Mrs. Brogdon located in Oklahoma that are managed by an AdCare subsidiary | 5 | |||||
Number of skilled nursing facilities which are alleged to interfere with contractual relations between the Plaintiffs and Mr. Brogdon and with Plaintiffs' prospective economic advantage | 7 | |||||
Settlement amount | $2 | |||||
Gain (loss) related to litigation settlement | -0.6 | -0.6 | ||||
Number of insurance carriers to pay the settlement amount | 2 | |||||
Number of units in facilities | 3,300 | |||||
Letter Received from Ohio Attorney General | ||||||
Legal Matters | ||||||
Fees payable as per the claim | $1 |
Related_Party_Transactions_Det
Related Party Transactions (Details Textual) (USD $) | 0 Months Ended | 12 Months Ended | |||
Mar. 26, 2015 | Dec. 31, 2014 | Mar. 27, 2014 | Mar. 31, 2015 | 5-May-15 | |
Related Party Transaction [Line Items] | |||||
Gain (loss) related to litigation settlement | ($600,000) | ($600,000) | |||
Chief Executive Officer [Member] | |||||
Related Party Transaction [Line Items] | |||||
Guarantor loan agreement amount | 17,900,000 | ||||
Convertible Notes Payable | Convertible Subordinated Promissory Notes Issued in March 2014 | Park City Capital Offshore Master, Ltd | |||||
Related Party Transaction [Line Items] | |||||
Debt instrument, principal amount | 1,000,000 | ||||
Percentage ownership | 5.00% | ||||
Convertible Notes Payable | Convertible Subordinated Promissory Notes Issued in March 2015 | Park City Capital Offshore Master, Ltd | |||||
Related Party Transaction [Line Items] | |||||
Debt instrument, principal amount | 1,000,000 | ||||
Convertible Notes Payable | Convertible Subordinated Promissory Notes Issued in March 2015 | Christopher L. Doucet and Suzette A. Doucet | |||||
Related Party Transaction [Line Items] | |||||
Debt instrument, principal amount | 300,000 | ||||
Convertible Notes Payable | Convertible Subordinated Promissory Notes Issued in March 2015 | Doucet Asset Management LLC | |||||
Related Party Transaction [Line Items] | |||||
Related party disclosure, placement fees payable upon subscription of notes, as per the agreement | $100,000 | ||||
Subsequent Event | Doucet Capital LLC, Doucet Asset Management LLC, Christopher L. Doucet and Suzette A. Doucet | |||||
Related Party Transaction [Line Items] | |||||
Percentage ownership | 5.00% |
Subsequent_Events_Details_Text
Subsequent Events (Details Textual) (USD $) | 3 Months Ended | 0 Months Ended | ||||||
Mar. 31, 2015 | Apr. 29, 2015 | Jan. 16, 2015 | 1-May-15 | Apr. 30, 2015 | Dec. 31, 2014 | Apr. 13, 2015 | Jan. 31, 2015 | |
facility | subsidiary | facility | facility | facility | ||||
facility | sublessee | sublessee | ||||||
sublessor | sublessor | |||||||
SUBSEQUENT EVENTS | ||||||||
Preferred stock, shares issued | 950,000 | 950,000 | ||||||
Preferred stock issued | $20,392,000 | $20,392,000 | ||||||
Number of facilities | 31 | |||||||
Number of skilled nursing facilities under non-cancelable operating leases | 11 | |||||||
Convertible Debt | 2015 Convertible Subordinated Notes Subscription Agreement | ||||||||
SUBSEQUENT EVENTS | ||||||||
Debt instrument, principal amount | 8,500,000 | |||||||
Convertible Debt | Convertible Subordinated Promissory Notes Issued in March 2015 | ||||||||
SUBSEQUENT EVENTS | ||||||||
Debt instrument, principal amount | 1,700,000 | |||||||
Subsequent Event | ||||||||
SUBSEQUENT EVENTS | ||||||||
Number of subsidiaries entered into sublease agreement | 2 | |||||||
Number of facilities | 2 | |||||||
Operating Leases, Future Minimum Payments Due, Next Twelve Months | 960,000 | |||||||
Subsequent Event | Convertible Debt | Convertible Subordinated Promissory Notes Issued in March 2015 | ||||||||
SUBSEQUENT EVENTS | ||||||||
Debt instrument, principal amount | 6,015,000 | |||||||
Debt Instrument, Subscription Accepted Not Funded, Face Amount | 800,000 | |||||||
Series A Preferred Stock [Member] | Subsequent Event | ||||||||
SUBSEQUENT EVENTS | ||||||||
Preferred stock, shares issued | 575,000 | |||||||
Preferred stock issued | 13,500,000 | |||||||
Share price (dollars per share) | $25.75 | |||||||
Quail Creek Nursing Home | Subsequent Event | ||||||||
SUBSEQUENT EVENTS | ||||||||
Number of beds under skilled nursing facility acquired | 109 | |||||||
Operating leases, term of contract | 10 years | |||||||
Number of renewal terms | 2 | |||||||
Renewal term (in years) | 5 years | |||||||
Northwest Nursing Center | Subsequent Event | ||||||||
SUBSEQUENT EVENTS | ||||||||
Number of beds under skilled nursing facility acquired | 88 | |||||||
Operating leases, term of contract | 10 years | |||||||
Number of renewal terms | 2 | |||||||
Renewal term (in years) | 5 years | |||||||
Companion Specialized Care Center | Subsequent Event | ||||||||
SUBSEQUENT EVENTS | ||||||||
Number of beds in facility to be sold | 102 | |||||||
Sales price | 3,500,000 | |||||||
Arkansas | Aria Sublessor | ||||||||
SUBSEQUENT EVENTS | ||||||||
Escalation percentage through initial term, as a percent | 0.02 | |||||||
Escalation percentage through renewal term, as a percent | 0.03 | |||||||
Number of skilled nursing facilities under non-cancelable operating leases | 10 | |||||||
Arkansas | Aria Sublessor | Subsequent Event | ||||||||
SUBSEQUENT EVENTS | ||||||||
Operating leases, term of contract | 10 years | |||||||
Operating Leases, monthly rental expense | 29,500 | |||||||
Renewal term (in years) | 5 years | |||||||
Operating Leases, Future Minimum Payments Due, Next Twelve Months | 5,300,000 | |||||||
Escalation percentage through initial term, as a percent | 0.02 | |||||||
Escalation percentage through renewal term, as a percent | 0.03 | |||||||
Number of skilled nursing facilities under non-cancelable operating leases | 8 | |||||||
Number of skilled nursing facilities leases terminated | 2 | |||||||
Number of sublessors | 8 | |||||||
Number of sublessees | 8 | |||||||
Southwest LTC-Quail Creek, LLC and Southwest LTC-NW OKC, LLC [Member] | Subsequent Event | ||||||||
SUBSEQUENT EVENTS | ||||||||
Number of skilled nursing facilities under non-cancelable operating leases | 1 | |||||||
Aria Health Consulting LLC | Aria Sublessor | Subsequent Event | ||||||||
SUBSEQUENT EVENTS | ||||||||
Payments for lease inducement fees | $2,000,000 | |||||||
Private Bank | Subsequent Event | Line of Credit | ||||||||
SUBSEQUENT EVENTS | ||||||||
Debt instrument, management fees, percentage of operator gross income (percent) | 5.00% |