Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2014 | Nov. 03, 2014 | |
Document Information [Line Items] | ' | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 30-Sep-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Trading Symbol | 'IFT | ' |
Entity Registrant Name | 'Imperial Holdings, Inc. | ' |
Entity Central Index Key | '0001494448 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 21,402,990 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | |
In Thousands, unless otherwise specified | |||
Assets | ' | ' | |
Cash and cash equivalents | $53,745 | $14,722 | [1] |
Restricted cash | 0 | 13,506 | [1] |
Prepaid expenses and other assets | 1,717 | 1,331 | [1] |
Deposits - other | 1,353 | 1,597 | [1] |
Deposits on purchase of life settlements | 50 | 0 | [1] |
Structured settlement receivables, at estimated fair value | 383 | 660 | [1] |
Structured settlement receivables at cost, net | 599 | 797 | [1] |
Investment in life settlements, at estimated fair value | 54,914 | 48,442 | [1] |
Fixed assets, net | 202 | 74 | [1] |
Investment in affiliates | 2,385 | 2,378 | [1] |
Deferred debt costs, net | 2,295 | 0 | [1] |
Total assets | 417,759 | 348,103 | [1] |
Liabilities | ' | ' | |
Accounts payable and accrued expenses | 5,209 | 2,977 | [1] |
Other liabilities | 1,039 | 21,221 | [1] |
Interest payable - senior unsecured convertible notes (Note 10) | 768 | 0 | [1] |
Revolving Credit facility debt, at estimated fair value | 142,661 | 123,847 | |
Senior unsecured convertible notes, net of discount (Note 10) | 55,250 | 0 | [1] |
Income taxes payable | 0 | 6,295 | [1] |
Deferred tax liability | 6,383 | 0 | [1] |
Total liabilities | 211,647 | 154,681 | [1] |
Commitments and Contingencies (Note 13) | ' | ' | [1] |
Stockholders' Equity | ' | ' | |
Common stock (par value $0.01 per share, 80,000,000 authorized; 21,402,990 and 21,237,166 issued and outstanding as of September 30, 2014 and December 31, 2013, respectively) | 214 | 212 | [1] |
Additional paid-in-capital | 266,511 | 239,506 | [1] |
Accumulated deficit | -60,613 | -46,296 | [1] |
Total stockholders' equity | 206,112 | 193,422 | [1] |
Total liabilities and stockholders' equity | 417,759 | 348,103 | [1] |
Primary Beneficiary Variable Interest Entity | ' | ' | |
Assets | ' | ' | |
Cash and cash equivalents | 4,647 | 7,977 | [1] |
Investment in life settlements, at estimated fair value | 295,469 | 254,519 | [1] |
Receivable for maturity of life settlements | 0 | 2,100 | [1] |
Liabilities | ' | ' | |
Accounts payable and accrued expenses | 337 | 341 | [1] |
Revolving Credit facility debt, at estimated fair value | $142,661 | $123,847 | [1] |
[1] | Derived from audited consolidated financial statements. |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | |
Common stock, par value | $0.01 | $0.01 | [1] |
Common stock, shares authorized | 80,000,000 | 80,000,000 | [1] |
Common stock, shares issued | 21,402,990 | 21,237,166 | [1] |
Common stock, shares outstanding | 21,402,990 | 21,237,166 | [1] |
[1] | Derived from audited consolidated financial statements. |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 3 Months Ended | 9 Months Ended | ||||||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | ||||
Income | ' | ' | ' | ' | ||||
Interest income | ' | ' | $102 | $220 | ||||
Interest and dividends on investment securities available for sale | 0 | 0 | 0 | 14 | ||||
Loss on life settlements, net | 0 | -461 | -426 | -1,708 | ||||
Change in fair value of life settlements (Notes 8 & 11) | -3,643 | 15,262 | 19,313 | 81,948 | ||||
Servicing fee income | 0 | 0 | 0 | 310 | ||||
Other income | 17 | 8 | 72 | 2,015 | ||||
Total (loss) income | -3,617 | 14,809 | 18,981 | 82,607 | ||||
Expenses | ' | ' | ' | ' | ||||
Interest expense | 4,303 | 1,158 | 11,165 | 12,020 | ||||
Loss on extinguishment of Bridge Facility | 0 | 0 | 0 | 3,991 | ||||
Change in fair value of Revolving Credit Facility debt (Notes 9 & 11) | -8,375 | 66 | -4,556 | -5,295 | ||||
Change in fair value of conversion derivative liability (Notes 10 & 11) | 0 | 0 | 6,759 | 0 | ||||
Gain on loan payoffs and settlements, net | 0 | 0 | 0 | -65 | ||||
Amortization of deferred costs | 0 | 0 | 0 | 7 | ||||
Personnel costs | 1,910 | 1,924 | 6,627 | 6,216 | ||||
Legal fees | 2,943 | 3,271 | 9,121 | 11,254 | ||||
Professional fees | 1,143 | 1,503 | 3,562 | 3,564 | ||||
Insurance | 414 | 478 | 1,253 | 1,475 | ||||
Other selling, general and administrative expenses | 544 | 303 | 1,365 | 1,476 | ||||
Total expenses | 2,882 | 8,703 | 35,296 | 34,643 | ||||
(Loss) income from continuing operations before income taxes | -6,499 | 6,106 | -16,315 | 47,964 | ||||
Benefit (provision) for income taxes | 2,235 | 0 | 2,452 | -40 | ||||
Net (loss) income from continuing operations | -4,264 | [1] | 6,106 | [2] | -13,863 | [1] | 47,924 | [2] |
Discontinued Operations: | ' | ' | ' | ' | ||||
(Loss) income from discontinued operations, net of income taxes | -249 | [1] | 55 | [2] | -454 | [1] | 1,627 | [2] |
Net (loss) income | -4,513 | [1] | 6,161 | [2] | -14,317 | [1] | 49,551 | [2] |
Basic and diluted earnings per common share | ' | ' | ' | ' | ||||
Continuing operations | ($0.20) | [1] | $0.29 | [2] | ($0.65) | [1] | $2.26 | [2] |
Discontinued operations | ($0.01) | [1] | $0 | [2] | ($0.02) | [1] | $0.08 | [2] |
Net (loss) income | ($0.21) | $0.29 | ($0.67) | $2.34 | ||||
Weighted average shares outstanding: | ' | ' | ' | ' | ||||
Basic weighted average common shares outstanding | 21,361,930 | [1] | 21,219,880 | [2] | 21,352,086 | [1] | 21,215,344 | [2] |
Diluted weighted average common shares outstanding | 21,361,930 | [1] | 21,223,027 | [2] | 21,352,086 | [1] | 21,215,392 | [2] |
Continuing Operations | ' | ' | ' | ' | ||||
Income | ' | ' | ' | ' | ||||
Interest income | $9 | $0 | $22 | $28 | ||||
[1] | The computation of diluted EPS does not include 815,448 options, 6,240,521 warrants, 41,060 shares of restricted stock, up to 10,464,941 shares of underlying common stock issuable upon conversion of the Notes and 299,500 performance shares for the three months and nine months ended September 30, 2014, as the effect of their inclusion would have been anti-dilutive. | |||||||
[2] | The computation of diluted EPS did not include 899,472 options, and 4,240,521 warrants for the three months and nine months ended September 30, 2013, as the effect of their inclusion would have been anti-dilutive. |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (Loss) (USD $) | 3 Months Ended | 9 Months Ended | ||||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | ||||
Net (loss) income | ($4,513) | [1] | $6,161 | [2] | ($14,317) | [1] | $49,551 | [2] |
Other comprehensive income (loss), net of tax | 0 | 0 | 0 | 3 | ||||
Comprehensive (loss) income | ($4,513) | $6,161 | ($14,317) | $49,554 | ||||
[1] | The computation of diluted EPS does not include 815,448 options, 6,240,521 warrants, 41,060 shares of restricted stock, up to 10,464,941 shares of underlying common stock issuable upon conversion of the Notes and 299,500 performance shares for the three months and nine months ended September 30, 2014, as the effect of their inclusion would have been anti-dilutive. | |||||||
[2] | The computation of diluted EPS did not include 899,472 options, and 4,240,521 warrants for the three months and nine months ended September 30, 2013, as the effect of their inclusion would have been anti-dilutive. |
Consolidated_Statements_of_Sto
Consolidated Statements of Stockholders' Equity (USD $) | Total | Common Stock | Additional Paid-in Capital | (Accumulated Deficit) | |
In Thousands, except Share data | |||||
Beginning Balance at Dec. 31, 2013 | $193,422 | [1] | $212 | $239,506 | ($46,296) |
Beginning Balance (in shares) at Dec. 31, 2013 | ' | 21,237,166 | ' | ' | |
Comprehensive loss | -14,317 | ' | ' | -14,317 | |
Stock-based compensation (in shares) | ' | 41,060 | ' | ' | |
Stock-based compensation | 762 | 1 | 761 | ' | |
Issuance of common stock (in shares) | ' | 125,628 | ' | ' | |
Issuance of common stock | 500 | 1 | 499 | ' | |
Issuance of warrants | 5,381 | ' | 5,381 | ' | |
Pre-conversion tax adjustment | 6,295 | ' | 6,295 | ' | |
Retirement of common stock | ' | -864 | ' | ' | |
Reclassification of conversion derivative liability, net of tax | 14,069 | ' | 14,069 | ' | |
Ending Balance at Sep. 30, 2014 | $206,112 | $214 | $266,511 | ($60,613) | |
Ending Balance (in shares) at Sep. 30, 2014 | ' | 21,402,990 | ' | ' | |
[1] | Derived from audited consolidated financial statements. |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | ||
Cash flows from operating activities | ' | ' | ||
Net (loss) income | ($14,317) | [1] | $49,551 | [2] |
Adjustments to reconcile net (loss) income to net cash used in operating activates: | ' | ' | ||
Depreciation and amortization | 59 | 142 | ||
Revolving Credit Facility origination cost | 0 | 10,340 | ||
Revolving Credit Facility financing cost | 4,238 | 995 | ||
Amortization of discount and deferred costs for senior unsecured convertible notes | 1,648 | 0 | ||
Amortization of premiums and accretion of discounts on available for sale securities | 0 | 21 | ||
Stock-based compensation expense | 762 | 1,203 | ||
Gain on loan payoffs and settlements, net | 0 | -65 | ||
Change in fair value of life settlements | -19,313 | -81,948 | ||
Unrealized change in fair value of structured settlements | -24 | -1,211 | ||
Change in fair value of Revolving Credit Facility debt | -4,556 | -5,295 | ||
Loss on life settlements, net | 426 | 1,708 | ||
Interest income | -102 | -220 | ||
Amortization of deferred costs | 0 | 7 | ||
Loss on extinguishment of Bridge Facility | 0 | 3,991 | ||
Gain on sale and prepayment of investment securities available for sale | 0 | -22 | ||
Change in fair value of warrants to be issued | 0 | 2,478 | ||
Change in fair value of conversion derivative liability | 6,759 | 0 | ||
Change in assets and liabilities: | ' | ' | ||
Restricted cash | 13,506 | -13,502 | ||
Deposits - other | 243 | 1,258 | ||
Investment in affiliates | -7 | -148 | ||
Structured settlement receivables | 578 | 1,687 | ||
Prepaid expenses and other assets | -413 | 12,461 | ||
Accounts payable and accrued expenses | 2,512 | 2,453 | ||
Other liabilities | -14,301 | -664 | ||
Interest receivable | 0 | 95 | ||
Interest payable | 768 | 0 | ||
Deferred income tax | -2,452 | 40 | ||
Net cash used in operating activities | -23,986 | -14,645 | ||
Cash flows from investing activities | ' | ' | ||
Purchase of fixed assets, net of disposals | -178 | -4 | ||
Purchase of investments in life settlements | -3,488 | -7,000 | ||
Proceeds from sale and prepayments of investment securities available for sale | 0 | 12,111 | ||
Proceeds from maturity of investment in life settlements | 13,641 | 6,039 | ||
Premiums paid on investments in life settlements | -40,578 | -50,984 | ||
Proceeds from surrender of investments in life settlements | 0 | 1,049 | ||
Proceeds from sale of investments in life settlements, net | 4,031 | 1,764 | ||
Deposit on purchase of investment in life settlement | -50 | 0 | ||
Proceeds from loan payoffs and lender protection insurance claims received in advance | 0 | 691 | ||
Net cash used in investing activities | -26,622 | -36,334 | ||
Cash flows from financing activities | ' | ' | ||
Revolving Credit and Bridge Facility origination cost | 0 | -6,731 | ||
Borrowings from Revolving Credit Facility | 36,004 | 66,584 | ||
Repayment of borrowings under Revolving Credit Facility | -17,595 | 0 | ||
Restricted cash | 0 | 1,162 | ||
Borrowings from Bridge Facility | 0 | 41,400 | ||
Repayment of borrowings under Bridge Facility | 0 | -45,000 | ||
Proceeds from senior unsecured convertible notes, net | 67,892 | 0 | ||
Net cash provided by financing activities | 86,301 | 57,415 | ||
Net increase in cash and cash equivalents | 35,693 | 6,436 | ||
Cash and cash equivalents, at beginning of the period | 22,699 | 7,001 | ||
Cash and cash equivalents, at end of the period | 58,392 | 13,437 | ||
Supplemental disclosures of cash flow information: | ' | ' | ||
Cash paid for interest during the period | 4,496 | 825 | ||
Supplemental disclosures of non-cash investing activities: | ' | ' | ||
Investment in life settlements acquired in foreclosure | 0 | 3,168 | ||
Supplemental disclosures of non-cash financing activities: | ' | ' | ||
Interest payment and fees withheld from borrowings by lender | 4,962 | 995 | ||
Credit facility origination costs paid to lender | 0 | 4,000 | ||
Purchase of policies through release of subrogation claim paid by lender | 0 | 48,500 | ||
Reclassification of derivative liability | $14,069 | $0 | ||
[1] | The computation of diluted EPS does not include 815,448 options, 6,240,521 warrants, 41,060 shares of restricted stock, up to 10,464,941 shares of underlying common stock issuable upon conversion of the Notes and 299,500 performance shares for the three months and nine months ended September 30, 2014, as the effect of their inclusion would have been anti-dilutive. | |||
[2] | The computation of diluted EPS did not include 899,472 options, and 4,240,521 warrants for the three months and nine months ended September 30, 2013, as the effect of their inclusion would have been anti-dilutive. |
Description_of_Business
Description of Business | 9 Months Ended |
Sep. 30, 2014 | |
Description of Business | ' |
(1) Description of Business | |
Founded in December 2006 as a Florida limited liability company, Imperial Holdings, LLC, converted into Imperial Holdings, Inc. (with its subsidiaries, the “Company” or “Imperial”) on February 3, 2011, in connection with the Company’s initial public offering. | |
Incorporated in Florida, Imperial owns a portfolio of 595 life insurance policies, also referred to as life settlements, with a fair value of $350.4 million and an aggregate death benefit of approximately $2.9 billion at September 30, 2014. The Company primarily earns income on these policies from changes in their fair value and through death benefits. 452 of these policies, with an aggregate death benefit of approximately $2.3 billion, are pledged under a 15-year revolving credit agreement (the “Revolving Credit Facility”) entered into by the Company’s indirect subsidiary, White Eagle Asset Portfolio, LP (“White Eagle”). |
Principles_of_Consolidation_an
Principles of Consolidation and Basis of Presentation | 9 Months Ended |
Sep. 30, 2014 | |
Principles of Consolidation and Basis of Presentation | ' |
(2) Principles of Consolidation and Basis of Presentation | |
The accompanying consolidated financial statements include the accounts of the Company, all of its wholly-owned subsidiary companies and its special purpose entities, with the exception of Imperial Settlements Financing 2010, LLC (“ISF 2010”), an unconsolidated special purpose entity. The special purpose entity has been created to fulfill specific objectives. All significant intercompany balances and transactions have been eliminated in consolidation, including income from services performed by subsidiaries in connection with the Revolving Credit Facility. Notwithstanding consolidation, White Eagle is the owner of 452 policies, with an aggregate death benefit of approximately $2.3 billion and an estimated fair value of approximately $295.5 million at September 30, 2014. | |
The unaudited consolidated financial statements have been prepared in conformity with the rules and regulations of the SEC for Form 10-Q and therefore do not include certain information, accounting policies, and footnote disclosures information or footnotes necessary for a complete presentation of financial position, results of operations and cash flows in conformity with generally accepted accounting principles. However, all adjustments (consisting of normal recurring accruals), which, in the opinion of management, are necessary for a fair presentation of the financial statements, have been included. Operating results for the three months and nine months ended September 30, 2014 are not necessarily indicative of the results that may be expected for future periods or for the year ended December 31, 2014. These interim financial statements should be read in conjunction with the Consolidated Financial Statements and Notes thereto included in Imperial’s Annual Report on Form 10-K for the fiscal year ended December 31, 2013. | |
Derivative Instruments | |
The Company issued and sold $70.7 million in aggregate principal amount of 8.50% senior unsecured convertible notes due 2019 (the “Notes”). Prior to shareholder approval on June 5, 2014 to issue shares of common stock upon conversion of the Notes in excess of New York Stock Exchange limits for share issuances without shareholder approval, the Notes contained an embedded derivative feature. In accordance with Accounting Standards Codification (“ASC”) 815, Derivatives and Hedging, derivative instruments are recognized as either assets or liabilities on the Company’s balance sheet and are measured at fair value with gains or losses recognized in earnings. Embedded derivatives that are not clearly and closely related to the host contract, such as the Notes, are bifurcated and recognized at fair value with changes in fair value recognized as either a gain or loss in earnings if they can be reliably measured. The Company determined the fair value of its embedded derivative based upon available market data and unobservable inputs using a Black Scholes pricing model. In accordance with ASC 815, upon receipt of shareholder approval on June 5, 2014, the Company reclassified the embedded derivative to equity along with unamortized transaction costs proportionate to the allocation of the initial debt discount and the principal amount of the Notes. The Notes are recorded at accreted value and will continue to be accreted up to the par value of the Notes at maturity. See Note 10, 8.50% Senior Unsecured Convertible Notes. | |
Foreign Currency | |
The Company’s foreign subsidiaries are considered to be extensions of the U.S. Company and the U.S. dollar is utilized as the functional currency. The foreign subsidiaries’ financial statements are denominated in U.S. dollars and therefore, there are no translation gains and losses resulting from converting the financial statements at exchange rates other than the functional currency. Any gains and losses resulting from foreign currency transactions (transactions denominated in a currency other than the subsidiaries’ functional currency) are included in income. At this time, these gains and losses are immaterial to the Company’s financial statements. | |
Use of Estimates | |
The preparation of these consolidated financial statements, in conformity with generally accepted accounting principles in the United States of America (“GAAP”), requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from these estimates and such differences could be material. Significant estimates made by management include income taxes, the valuation of investments in life settlements, the valuation of the debt owing under the Revolving Credit Facility, the valuation of equity awards and the valuation of the conversion derivative liability formerly embedded within the Company’s Notes. |
Recent_Accounting_Pronouncemen
Recent Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2014 | |
Recent Accounting Pronouncements | ' |
(3) Recent Accounting Pronouncements | |
In July 2013, the FASB issued ASU No. 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (“ASU 2013-11”). ASU 2013-11 requires, unless certain conditions exist, an unrecognized tax benefit, or a portion of an unrecognized tax benefit, to be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, similar tax loss, or a tax credit carryforward. ASU 2013-11 is effective prospectively for reporting periods beginning after December 15, 2013. Retrospective application is permitted. The Company adopted ASU 2013-11 effective on January 1, 2014, which required the Company to reclassify a $6.3 million current liability for unrecognized tax benefits to deferred taxes. Adoption of this guidance resulted in the recognition of a $3.7 million tax expense in the Company’s consolidated financial statement of operations for the nine months ended September 30, 2014, a $2.6 million reduction in the valuation allowance and an increase to additional paid-in-capital of $6.3 million on the Company’s consolidated balance sheet and consolidated statement of stockholders’ equity as of September 30, 2014. | |
In April 2014, the FASB issued ASU 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. The amendments in the ASU change the criteria for reporting discontinued operations while enhancing disclosures in this area. The new guidance requires expanded disclosures about discontinued operations that will provide financial statement users with more information about the assets, liabilities, income, and expenses of discontinued operations. The new guidance also requires disclosure of the pre-tax income attributable to a disposal of a significant part of an organization that does not qualify for discontinued operations reporting. The amendments in the ASU are effective in the first quarter of 2015 for public business entities with calendar year ends. Early adoption is permitted. The Company is currently in the process of evaluating the impact, if any, of the adoption on its consolidated financial statements. | |
In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, which converges the FASB and the International Accounting Standards Board standard on revenue recognition. Areas of revenue recognition that will be affected include, but are not limited to, transfer of control, variable consideration, allocation of transfer pricing, licenses, time value of money, contract costs and disclosures. This is effective for the fiscal years and interim reporting periods beginning after December 15, 2016. We are currently evaluating the impact that the adoption of ASU 2014-09 will have on our consolidated financial statements or related disclosures. |
Consolidation_of_Variable_Inte
Consolidation of Variable Interest Entities | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Consolidation of Variable Interest Entities | ' | ||||||||||||||||
(4) Consolidation of Variable Interest Entities | |||||||||||||||||
The Company evaluates its interests in variable interest entities (“VIEs”) on an ongoing basis and consolidates those VIEs in which it has a controlling financial interest and is thus deemed to be the primary beneficiary. A controlling financial interest has both of the following characteristics: (i) the power to direct the activities of the VIE that most significantly impact its economic performance; and (ii) the obligation to absorb losses of the VIE that could potentially be significant to it or the right to receive benefits from the VIE that could be significant to the VIE. | |||||||||||||||||
The following table presents the consolidated assets and consolidated liabilities of VIEs for which the Company has concluded that it is the primary beneficiary and which are consolidated in the Company’s consolidated financial statements as of September 30, 2014 as well as non-consolidated VIEs for which the Company has determined it is not the primary beneficiary (in thousands): | |||||||||||||||||
Primary Beneficiary | Not Primary | ||||||||||||||||
Beneficiary | |||||||||||||||||
Consolidated VIEs | Non-consolidated VIEs | ||||||||||||||||
Assets | Liabilities | Total | Maximum Exposure | ||||||||||||||
Assets | To Loss | ||||||||||||||||
30-Sep-14 | $ | 300,116 | $ | 142,998 | $ | 2,385 | $2,385 | ||||||||||
31-Dec-13 | $ | 264,596 | $ | 124,188 | $ | 2,378 | $2,378 | ||||||||||
As of September 30, 2014, 452 life insurance policies owned by White Eagle with an aggregate death benefit of approximately $2.3 billion and an estimated fair value of approximately $295.5 million were pledged as collateral under the Revolving Credit Facility. Effective May 16, 2014, a foreign subsidiary acts as portfolio manager for life insurance policies owned by White Eagle and it was determined that the Company will continue to be the primary beneficiary of White Eagle as it has a controlling financial interest and the Company’s subsidiaries have the power to direct the activities that most significantly impacted White Eagle’s economic performance and the obligation to absorb economic gains and losses. In accordance with Accounting Standards Codification (“ASC”) 810, Consolidation, the Company consolidated White Eagle in its financial statements for the three months and nine months ended September 30, 2014 and the year ended December 31, 2013. |
Earnings_Per_Share
Earnings Per Share | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Earnings Per Share | ' | ||||||||||||||||
(5) Earnings Per Share | |||||||||||||||||
Basic net income per share is computed by dividing the net earnings attributable to common shareholders by the weighted average number of common shares outstanding during the period. | |||||||||||||||||
Diluted earnings per share is computed by dividing net income attributable to common shareholders by the weighted average number of common shares outstanding, increased to include the number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued. Conversion or exercise of the potential common shares is not reflected in diluted earnings per share unless the effect is dilutive. The dilutive effect, if any, of outstanding common share equivalents is reflected in diluted earnings per share by application of the treasury stock method, as applicable. In determining whether outstanding stock options, restricted stock, warrants and Notes should be considered for their dilutive effect, the average market price of the common stock for the period has to exceed the exercise price of the outstanding common share equivalent. | |||||||||||||||||
The following tables reconcile actual basic and diluted earnings per share for the three months and nine months ended September 30, 2014 and 2013 (in thousands except share and per share data). | |||||||||||||||||
For the Three Months | For the Nine Months | ||||||||||||||||
Ended September 30, | Ended September 30, | ||||||||||||||||
2014(1) | 2013(2) | 2014(1) | 2013(2) | ||||||||||||||
Earnings per share: | |||||||||||||||||
Numerator: | |||||||||||||||||
Net (loss) income from continuing operations | $ | (4,264 | ) | $ | 6,106 | $ | (13,863 | ) | $ | 47,924 | |||||||
Net (loss) income income from discontinued operations | $ | (249 | ) | $ | 55 | $ | (454 | ) | $ | 1,627 | |||||||
Net (loss) income | $ | (4,513 | ) | $ | 6,161 | $ | (14,317 | ) | $ | 49,551 | |||||||
Basic earnings per common share: | |||||||||||||||||
Basic (loss) income from continuing operations | $ | (0.20 | ) | $ | 0.29 | $ | (0.65 | ) | $ | 2.26 | |||||||
Basic (loss )income from discontinued operations | $ | (0.01 | ) | — | $ | (0.02 | ) | $ | 0.08 | ||||||||
Basic (loss) income per share available to common shareholders | $ | (0.21 | ) | $ | 0.29 | $ | (0.67 | ) | $ | 2.34 | |||||||
Denominator: | |||||||||||||||||
Basic weighted average common shares outstanding | 21,361,930 | 21,219,880 | 21,352,086 | 21,215,344 | |||||||||||||
Diluted earnings per per common share: | |||||||||||||||||
Diluted (loss) income from continuing operations. | $ | (0.20 | ) | $ | 0.29 | $ | (0.65 | ) | $ | 2.26 | |||||||
Diluted (loss) income from discontinued operations | $ | (0.01 | ) | $ | — | $ | (0.02 | ) | $ | 0.08 | |||||||
Diluted (loss) income per share available to common shareholders | $ | (0.21 | ) | $ | 0.29 | $ | (0.67 | ) | $ | 2.34 | |||||||
Denominator: | |||||||||||||||||
Weighted average common shares outstanding | 21,361,930 | 21,219,880 | 21,352,086 | 21,215,344 | |||||||||||||
Add: Restricted Stock | — | 3,147 | — | 48 | |||||||||||||
Diluted weighted average shares outstanding | 21,361,930 | 21,223,027 | 21,352,086 | 21,215,392 | |||||||||||||
-1 | The computation of diluted EPS does not include 815,448 options, 6,240,521 warrants, 41,060 shares of restricted stock, up to 10,464,941 shares of underlying common stock issuable upon conversion of the Notes and 299,500 performance shares for the three months and nine months ended September 30, 2014, as the effect of their inclusion would have been anti-dilutive. | ||||||||||||||||
-2 | The computation of diluted EPS did not include 899,472 options, and 4,240,521 warrants for the three months and nine months ended September 30, 2013, as the effect of their inclusion would have been anti-dilutive. |
Stockbased_Compensation
Stock-based Compensation | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Stock-based Compensation | ' | ||||||||||||||||
(6) Stock-based Compensation | |||||||||||||||||
In 2011, the Company established the Imperial Holdings 2011 Omnibus Incentive Plan (the “Omnibus Plan”) to attract, retain and motivate participating employees and to attract and retain well-qualified individuals to serve as members of the board of directors, consultants and advisors through the use of incentives based upon the value of our common stock. Awards under the Omnibus Plan may consist of incentive awards, stock options, stock appreciation rights, performance shares, performance units, and shares of common stock, restricted stock, restricted stock units or other stock-based awards as determined by the compensation committee. The Omnibus Plan provides that an aggregate of 1,200,000 shares of common stock are reserved for issuance under the Omnibus Plan, subject to adjustment as provided in the Omnibus Plan. The outstanding options issued in 2011 expire seven years after the date of grant and were granted with a strike price of $10.75, which was the offering price of our initial public offering or fair market value (closing price) of the stock on the date of grant and vest over three years. | |||||||||||||||||
On April 1, 2013, the Company granted 13,759 shares of unrestricted common stock to its outside directors with an aggregate grant date fair value of approximately $57,000 computed in accordance with ASC 718, Compensation-Stock Compensation. During the year ended December 31, 2013, the Company issued 545,000 options to employees at a strike price of $6.94. The Company recognized approximately $140,000 and $118,000 in stock-based compensation expense relating to stock options it granted under the Omnibus Plan during the three months ended September 30, 2014 and 2013, respectively and $632,000 and $1.1 million during the nine months ended September 30, 2014 and 2013, respectively. The Company incurred additional stock-based compensation expense of approximately $61,000 and $30,000 relating to restricted stock granted to its board of directors during the three months ended September 30, 2014 and 2013, respectively and $130,000 and $39,000 during the nine months ended September 30, 2014 and 2013, respectively. During the nine months ended September 30, 2014, the Company awarded 299,500 target performance shares for restricted common stock to its directors and certain employees, of which 150,000 shares are subject to shareholder approval of an amendment to the Omnibus Plan at the Company’s 2015 annual meeting. The issuance of the performance shares is contingent on the Company’s financial performance, as well as the performance of the Company’s common stock through June 30, 2016, with the actual shares to be issued ranging between 0 – 150% of the target performance shares. The Company will evaluate on a quarterly basis whether it is probable that the Company’s financial performance conditions will be achieved. At September 30, 2014, the Company determined that it was not probable that the performance conditions would be achieved and as a result, no related expense was recognized for the three and nine months ended September 30, 2014. Once issued, the performance shares will be subject to a one year vesting period from the date of issuance. | |||||||||||||||||
Options | |||||||||||||||||
As of September 30, 2014, options to purchase 815,448 shares of common stock were outstanding and unexercised under the Omnibus Plan at a weighted average exercise price of $8.49 per share. | |||||||||||||||||
The following table presents the activity of the Company’s outstanding stock options of common stock for the nine months ended September 30, 2014: | |||||||||||||||||
Common Stock Options | Number of | Weighted | Weighted | Aggregate | |||||||||||||
Shares | Average Price | Average | Intrinsic | ||||||||||||||
per Share | Remaining | Value | |||||||||||||||
Contractual | |||||||||||||||||
Term | |||||||||||||||||
Options outstanding, January 1, 2014 | 831,282 | $ | 8.46 | 5.51 | — | ||||||||||||
Options granted | — | — | — | — | |||||||||||||
Options exercised | — | — | — | — | |||||||||||||
Options forfeited | (15,834 | ) | $ | 6.94 | 5.68 | — | |||||||||||
Options expired | — | — | — | — | |||||||||||||
Options outstanding, September 30, 2014 | 815,448 | $ | 8.49 | 4.74 | — | ||||||||||||
Exercisable at September 30, 2014 | 654,740 | $ | 8.87 | 4.51 | — | ||||||||||||
Unvested at September 30, 2014 | 160,708 | $ | 6.94 | 5.68 | — | ||||||||||||
As of September 30, 2014, all outstanding stock options had an exercise price above the average fair market value of the common stock during the nine months ended September 30, 2014. | |||||||||||||||||
During the three months and nine months ended September 30, 2014, the Company recognized expense of $140,000 and $632,000, respectively related to these options. The remaining unamortized amounts in respect of the June 5, 2013 option grants of approximately $140,000 and $239,000 will be expensed during the remainder of 2014 and 2015, respectively. | |||||||||||||||||
Restricted Stock | |||||||||||||||||
17,286 shares of restricted stock granted to our directors under the Omnibus Plan vested during the nine months ended September 30, 2014. The fair value of the vested restricted stock was valued at $120,138 based on the closing price of the Company’s shares on the grant date. The Company expensed approximately $0 and $52,000 in stock based compensation related to the 17,286 shares of restricted stock during the three months and nine months ended September 30, 2014, respectively. | |||||||||||||||||
During the nine months ended September 30, 2014, the Company granted 41,060 shares of restricted stock to its directors under the Omnibus Plan subject to a one year vesting schedule that commenced on the date of grant. The fair value of the unvested restricted stock was valued at $254,983 based on the closing price of the Company’s shares on the day prior to the grant date. The Company incurred additional stock-based compensation expense of approximately $61,000 and $78,000 related to these 41,060 shares of restricted stock during the three months and nine months ended September 30, 2014, respectively. | |||||||||||||||||
The following table presents the activity of the Company’s restricted stock for the nine months ended September 30, 2014: | |||||||||||||||||
Common Unvested Shares | Number of | ||||||||||||||||
Shares | |||||||||||||||||
Outstanding January 1, 2014 | 17,286 | ||||||||||||||||
Granted | 41,060 | ||||||||||||||||
Vested | (17,286 | ) | |||||||||||||||
Forfeited | — | ||||||||||||||||
Outstanding September 30, 2014 | 41,060 | ||||||||||||||||
The aggregate intrinsic value of unvested restricted stock awards is approximately $265,000 and the stock will vest in June 2015. | |||||||||||||||||
Performance Shares | |||||||||||||||||
During the nine months ended September 30, 2014, the Company awarded 299,500 target performance shares for restricted common stock to its directors and certain employees, of which 150,000 shares are subject to shareholder approval of an amendment to the Omnibus Plan at the Company’s 2015 annual meeting. The issuance of the performance shares is contingent on the Company’s financial performance, as well as the performance of the Company’s common stock through June 30, 2016, with the actual shares to be issued ranging between 0 – 150% of the target performance shares. At September 30, 2014, the Company determined that it was not probable that the performance conditions would be achieved and no related expense was recognized for the quarter or nine months ended September 30, 2014. Once issued, the performance shares will be subject to a one year vesting period from the date of issuance. | |||||||||||||||||
The following table presents the activity of the Company’s performance share awards for the nine months ended September 30, 2014: | |||||||||||||||||
Performance Shares | Number of | ||||||||||||||||
Shares | |||||||||||||||||
Outstanding January 1, 2014 | — | ||||||||||||||||
Awarded | 299,500 | ||||||||||||||||
Vested | — | ||||||||||||||||
Forfeited | — | ||||||||||||||||
Outstanding September 30, 2014 | 299,500 | ||||||||||||||||
Warrants | |||||||||||||||||
On February 11, 2011, three shareholders received ownership of warrants that may be exercised for up to a total of 4,240,521 shares of the Company’s common stock at a weighted average exercise price of $14.51 per share. The warrants will expire seven years after the date of issuance and the exercisability of the warrant will vest ratably over four years. At September 30, 2014, 3,180,391 warrants were exercisable with a weighted average exercise price of $14.51. | |||||||||||||||||
In connection with the class action settlement described in Note 13, Commitments and Contingencies, the Company issued warrants to purchase two million shares of the Company’s stock into an escrow account in April of 2014. The estimated fair value as of the measurement date of such warrants was $5.4 million, which is included in stockholders’ equity. The warrants were distributed in October 2014 and have a five-year term from the date they are distributed to the class participants with an exercise price of $10.75. The Company is obligated to file a registration statement to register the shares underlying the warrants with the SEC if shares of the Company’s common stock have an average daily trading closing price of at least $8.50 per share for a 45 day period. The warrants will be exercisable upon effectiveness of the registration statement. |
Discontinued_Operations
Discontinued Operations | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Discontinued Operations | ' | ||||||||||||||||
(7) Discontinued Operations | |||||||||||||||||
On October 25, 2013, the Company sold substantially all of the operating assets comprising its structured settlement business for gross proceeds of $12.0 million. The Company’s decision to sell the division was to focus on the life settlements business. No structured settlement receivables were sold and no on-balance sheet liabilities were transferred in connection with the sale. This sale resulted in the recognition of a gain of $11.3 million in the fourth quarter of 2013. | |||||||||||||||||
As a result of the sale, the Company retrospectively reclassified its structured settlement business operating results as discontinued operations, net of income taxes, in the accompanying Consolidated Statements of Operations for all periods presented and the Company has discontinued segment reporting. All other footnotes in these financial statements that were affected by this reclassification of discontinued operations have been updated accordingly. | |||||||||||||||||
Operating results related to the Company’s discontinued structured settlement business are as follows: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Total income | $ | 38 | $ | 2,698 | $ | 150 | $ | 10,366 | |||||||||
Total expenses | (287 | ) | (2,643 | ) | (604 | ) | (8,739 | ) | |||||||||
(Loss) income before income taxes | (249 | ) | 55 | (454 | ) | 1,627 | |||||||||||
Income tax expense | — | — | — | — | |||||||||||||
Net (loss) income from discontinued operations | $ | (249 | ) | $ | 55 | $ | (454 | ) | $ | 1,627 | |||||||
Investment_in_Life_Settlements
Investment in Life Settlements (Life Insurance Policies) | 9 Months Ended | ||||||||||||
Sep. 30, 2014 | |||||||||||||
Investment in Life Settlements (Life Insurance Policies) | ' | ||||||||||||
(8) Investment in Life Settlements (Life Insurance Policies) | |||||||||||||
The Company accounts for policies it acquires using the fair value method in accordance with ASC 325-30-50 Investments—Other—Investment in Insurance Contracts. Under the fair value method, the Company recognizes the initial investment at the purchase price. For policies that were relinquished in satisfaction of premium finance loans at maturity, the initial investment is the loan carrying value. For policies purchased in the secondary or tertiary markets, the initial investment is the amount of cash outlay at the time of purchase. At each reporting period, the Company re-measures the investment at fair value in its entirety and recognizes changes in fair value in earnings in the period in which the changes occur. | |||||||||||||
As of September 30, 2014 and December 31, 2013, the Company owned 595 and 612 policies, respectively, with an aggregate estimated fair value of investments in life settlements of $350.4 million and $303.0 million, respectively. | |||||||||||||
The weighted average life expectancy calculated based on death benefit of insureds in the policies owned by the Company at September 30, 2014 was 11.0 years. The following table describes the Company’s investments in life settlements as of September 30, 2014 (dollars in thousands): | |||||||||||||
Remaining Life Expectancy (In Years) | Number of | Fair | Face | ||||||||||
Life Settlement | Value | Value | |||||||||||
Contracts | |||||||||||||
0 - 1 | — | $ | — | $ | — | ||||||||
2-Jan | 2 | 3,727 | 5,377 | ||||||||||
3-Feb | 11 | 26,135 | 46,957 | ||||||||||
4-Mar | 9 | 11,642 | 29,800 | ||||||||||
5-Apr | 15 | 21,145 | 63,854 | ||||||||||
Thereafter | 558 | 287,734 | 2,742,301 | ||||||||||
Total | 595 | $ | 350,383 | $ | 2,888,289 | ||||||||
The weighted average life expectancy calculated based on death benefit of insureds in the policies owned by the Company at December 31, 2013 was 11.6 years. The following table describes the Company’s investments in life settlements as of December 31, 2013 (dollars in thousands): | |||||||||||||
Remaining Life Expectancy (In Years) | Number of | Fair Value | Face Value | ||||||||||
Life Settlement | |||||||||||||
Contracts | |||||||||||||
0 - 1 | — | $ | — | $ | — | ||||||||
2-Jan | — | — | — | ||||||||||
3-Feb | 6 | 8,489 | 16,875 | ||||||||||
4-Mar | 10 | 14,171 | 38,100 | ||||||||||
5-Apr | 8 | 13,529 | 40,250 | ||||||||||
Thereafter | 588 | 266,772 | 2,859,665 | ||||||||||
Total | 612 | $ | 302,961 | $ | 2,954,890 | ||||||||
This table is not intended to reflect the cash flow pattern expected over the life of the policies; the Company projects its cash flows using a probabilistic approach. The life expectancies represent the average number of years of life remaining on individuals with similar characteristics including age and gender. | |||||||||||||
Estimated premiums to be paid for the remainder of fiscal year 2014, the four succeeding fiscal years, and thereafter to keep the life insurance policies in force as of September 30, 2014, are as follows (in thousands): | |||||||||||||
Remainder of 2014 | $ | 13,436 | |||||||||||
2015 | 53,625 | ||||||||||||
2016 | 57,116 | ||||||||||||
2017 | 63,683 | ||||||||||||
2018 | 67,945 | ||||||||||||
Thereafter | 1,145,526 | ||||||||||||
$ | 1,401,331 | ||||||||||||
The amount of $1.4 billion noted above represents the estimated total future premium payments required to keep the life insurance policies in force utilizing the Company’s probabilistic approach and does not give effect to projected receipt of death benefits. The estimated total future premium payments could increase or decrease significantly to the extent that actual mortalities of insureds differs from the estimated life expectancies. |
Debt_Disclosure
Debt Disclosure | 9 Months Ended | ||||
Sep. 30, 2014 | |||||
8.50% Senior Unsecured Convertible Notes Due 2019 | ' | ||||
Debt Disclosure | ' | ||||
(10) 8.50% Senior Unsecured Convertible Notes | |||||
In February 2014, the Company issued $70.7 million in an aggregate principal amount of 8.50% senior unsecured convertible notes due 2019. The Notes were sold, in part, to certain accredited investors pursuant to Regulation D under the Securities Act of 1933 and, in part, to an initial purchaser who then resold such Notes to qualified institutional buyers pursuant to Rule 144A of the Securities Act of 1933. The Notes were issued pursuant to an indenture dated February 21, 2014, between the Company and U.S. Bank National Association, as trustee (the “Indenture”). Two members of our Board of Directors, Messrs. Dakos and Goldstein, are affiliated with Bulldog Investors, LLC, who purchased Notes in the aggregate principal amount of $9.2 million in the offering. | |||||
The Notes are general senior unsecured obligations and rank equally in right of payment with all of our other existing and future senior unsecured indebtedness. The Notes are effectively subordinate to all of our secured indebtedness to the extent of the value of the assets collateralizing such indebtedness. The Notes are not guaranteed by our subsidiaries. | |||||
The maturity date of the Notes is February 15, 2019. The Notes accrue interest at the rate of 8.50% per annum on the principal amount of the Notes, payable semi-annually in arrears on August 15 and February 15 of each year with the first interest payment on August 15, 2014. | |||||
The Notes are convertible into shares of common stock at any time prior to the close of business on the second scheduled trading day immediately preceding the maturity date. The Notes may be converted into shares of common stock initially at a conversion rate of 147.9290 shares of common stock per $1,000 principal amount of Notes (equivalent to a conversion price of $6.76 per share of common stock), subject to adjustment. | |||||
The Company may not redeem the Notes prior to February 15, 2017. On and after February 15, 2017, and prior to the maturity date, the Company may redeem for cash all, but not less than all, of the Notes if the last reported sale price of the Company’s common stock equals or exceeds 130% of the applicable conversion price for at least 20 trading days during the 30 consecutive trading day period ending on the trading day immediately prior to the date the Company delivers notice of the redemption. The redemption price will be equal to 100% of the principal amount of the Notes, plus any accrued and unpaid interest to, but excluding, the redemption date. In addition, if we call the Notes for redemption, a make-whole fundamental charge will be deemed to occur. As a result, we will, in certain circumstances, increase the conversion rate by a number of additional shares of common stock for holders who convert their notes prior to the redemption date. | |||||
The Company determined that an embedded conversion option existed in the Notes, prior to June 5, 2014, that was required to be separately accounted for as a derivative under ASC 815 which required the Company to bifurcate the embedded conversion option and record it as a liability at fair value and record a debt discount by an equal amount with changes in the fair value of the conversion derivative liability recorded in earnings and the discount on the debt liability, together with the stated interest on the instrument, amortized to interest expense over the life of the debt using the effective interest method. | |||||
On June 5, 2014, the Company obtained shareholder approval to issue shares of common stock upon conversion of the Notes in an amount that exceeded applicable New York Stock Exchange limits for issuances without shareholder approval. In accordance with ASC 815, the Company reclassified the embedded conversion derivative liability to equity along with unamortized transaction costs proportionate to the allocation of the initial debt discount and the principal amount of the Notes. The Notes are recorded at accreted value and will continue to be accreted up to the par value of the Notes at maturity. | |||||
The fair value of the conversion derivative liability was estimated at June 5, 2014 using a Black Scholes pricing model with the following assumptions: | |||||
As of | |||||
June 5, 2014 | |||||
Expected Volatility | 40 | % | |||
Expected Term in Years | 4.7 | ||||
Risk Free Rate | 1.5 | % | |||
At June 5, 2014, the fair value of the conversion derivative liability was $23.7 million. In accordance with ASC 815, the Company reclassified this amount along with $756,000 of unamortized transaction costs offset by deferred taxes of $8.8 million to stockholders’ equity. As of September 30, 2014, the carrying value of the Notes was $55.3 million. The unamortized debt discount and origination cost of $15.5 million and $2.3 million, respectively, will be amortized over the remaining life of the Notes, using the effective interest method. | |||||
The Company recorded $2.2 million of interest expense, including $1.5 million, $605,000 and $90,000 from interest, amortizing debt discounts and issuance costs, during the three months ended September 30, 2014 and $5.3 million of interest expense, including $3.7 million, $1.4 million and $239,000 from interest, amortizing debt discounts and issuance costs, during the nine months ended September 30, 2014. | |||||
During the nine months ended September 30, 2014, the Company recorded a loss on the change in fair value of the conversion derivative liability of $6.8 million. | |||||
Revolving Credit Facility | ' | ||||
Debt Disclosure | ' | ||||
(9) Revolving Credit Facility | |||||
On May 16, 2014, White Eagle Asset Portfolio, LLC converted from a Delaware limited liability company to White Eagle Asset Portfolio, LP, a Delaware limited partnership (the “Conversion”) and all of its ownership interests were transferred to an indirect, wholly-owned Irish subsidiary of the Company. In connection with the Conversion, White Eagle entered into an Amended and Restated Loan and Security Agreement (the “Revolving Credit Facility”) among White Eagle, as borrower, Imperial Finance and Trading, LLC, as the initial servicer, the initial portfolio manager and guarantor, Lamington Road Bermuda Ltd., as portfolio manager, LNV Corporation, as initial lender, the other financial institutions party thereto as lenders, and CLMG Corp., as administrative agent for the lenders. The Revolving Credit Facility amended and restated the revolving credit facility previously entered into by White Eagle on April 29, 2013. | |||||
In connection with the entry into the amended and restated Revolving Credit Facility, a new servicing agreement with respect to the policies pledged under the facility has been entered into with a third party. Prior to the amendment and restatement, a corporate subsidiary acted as servicer. | |||||
As of September 30, 2014, 452 life insurance policies owned by White Eagle with an aggregate death benefit of approximately $2.3 billion and an estimated fair value of approximately $295.5 million are pledged as collateral under the Revolving Credit Facility. | |||||
General & Security. The Revolving Credit Facility provides for an asset-based revolving credit facility backed by White Eagle’s portfolio of life insurance policies with an initial aggregate lender commitment of up to $300.0 million, subject to borrowing base availability. 452 life insurance policies with an aggregate death benefit of approximately $2.3 billion and an estimated fair value of approximately $295.5 million are pledged as collateral under the Revolving Credit Facility at September 30, 2014. In addition, the equity interests in White Eagle have been pledged under the Revolving Credit Facility. | |||||
Borrowing Base. Borrowing availability under the Revolving Credit Facility is subject to a borrowing base, which at any time is equal to the lesser of (A) the sum of all of the following amounts that have been funded or are to be funded through the next distribution date (i) the initial advance and all additional advances to acquire additional pledged policies or that are not for ongoing maintenance advances, plus (ii) 100% of the sum of the ongoing maintenance costs, plus (iii) 100% of accrued and unpaid interest on borrowings (excluding the rate floor portion described below), plus (iv) 100% of any other fees and expenses funded and to be funded as approved by the required lenders, less (v) any required payments of principal and interest previously distributed and to be distributed through the next distribution date; (B) 75% of the valuation of the policies pledged as collateral as determined by the lenders; (C) 50% of the aggregate face amount of the policies pledged as collateral (excluding certain specified life insurance policies); and (D) the then applicable facility limit. At September 30, 2014, $143.4 million was undrawn and $2.6 million was available to borrow under the Revolving Credit Facility. | |||||
Amortization & Distributions. Proceeds from the policies pledged as collateral under the Revolving Credit Facility will be distributed pursuant to a waterfall. Absent an event of default, after premium payments and fees to service providers, 100% of the remaining proceeds will be directed to pay outstanding interest and principal on the loan, unless the lenders determine otherwise. Generally, after payment of interest and principal, collections from policy proceeds are to be paid to White Eagle up to $76.1 million, then 50% of the remaining proceeds are to be directed to the lenders with the remainder paid to White Eagle and for any unpaid fees to service providers. With respect to approximately 25% of the face amount of policies pledged as collateral under the Revolving Credit Facility, White Eagle has agreed that if policy proceeds that are otherwise due are not paid by an insurance carrier, the foregoing distributions will be altered such that the lenders will receive any “catch-up” payments in respect of amounts that they would have received in the waterfall prior to distributions being made to White Eagle. During the continuance of events of default or unmatured events of default, the amounts from collections of policy proceeds that might otherwise be paid to White Eagle will instead be held in a designated account controlled by the lenders and may be applied to fund operating and third party expenses, interest and principal, “catch-up” payments or percentage payments that would go to the lenders as described above. | |||||
Use of Proceeds. Generally, ongoing advances may be made for paying premiums on the life insurance policies pledged as collateral, to pay debt service (other than a “rate floor” component equal to the greater of LIBOR (or the applicable base rate) and 1.5%), and to pay the fees of service providers. Subsequent advances in respect of newly pledged policies are at the discretion of the lenders and the use of proceeds from those advances are at the discretion of the lenders. | |||||
Interest. Borrowings under the Revolving Credit Facility bear interest at a rate equal to LIBOR or, if LIBOR is unavailable, the base rate, in each case plus an applicable margin of 4.00% and subject to the rate floor described above. The base rate under the Revolving Credit Facility equals the sum of (i) the weighted average of the interest rates on overnight federal funds transactions or, if unavailable, the average of three federal funds quotations received by the Agent plus 0.75% and (ii) 0.5%. The effective rate at September 30, 2014 is 5.5%. | |||||
Interest expense for the cash portion of interest paid during the period is recorded in the Company’s consolidated financial statements. Accrued interest is reflected as a component of the estimated fair value of the Revolving Credit Facility debt. Total interest expense on the facility was $2.1 million, which includes $1.5 million withheld from borrowings by the lender and $573,000 paid by White Eagle, for the three months ended September 30, 2014 and $5.8 million, which includes $4.2 million withheld from borrowings by the lender and $1.6 million paid by White Eagle, for the nine months ended September 30, 2014. | |||||
Maturity. The term of the Revolving Credit Facility expires April 28, 2028, which is also the scheduled commitment termination date (though the lenders’ commitments to fund borrowings may terminate earlier in an event of default). The lenders’ interests in and rights to a portion of the proceeds of the policies does not terminate with the repayment of the principal borrowed and interest accrued thereon, the termination of the Revolving Credit Facility or expiration of the lenders’ commitments. | |||||
Covenants/Events of Defaults. The Revolving Credit Facility contains covenants and events of default that are customary for asset-based credit agreements of this type, but also include cross defaults under the servicing, account control, contribution and pledge agreements entered into in connection with the Revolving Credit Facility (including in relation to breached by third parties thereunder), certain changes in law, changes in control of or insolvency or bankruptcy of the Company and relevant subsidiaries and performance of certain obligations by certain relevant subsidiaries, White Eagle and third parties. The Revolving Credit Facility does not contain any financial covenants, but does contain certain tests relating to asset maintenance, performance and valuation the satisfaction of which will be determined by the lenders with a high degree of discretion. | |||||
Remedies. The Revolving Credit Facility and ancillary transaction documents afford the lenders a high degree of discretion in their selection of and implementation of remedies in relation to any event of default, including a high degree of discretion in determining whether to foreclose upon and liquidate all or any pledged policies, the interests in White Eagle, and the manner of any such liquidation. White Eagle has limited ability to cure events of default through the sale of policies or the procurement of replacement financing. | |||||
We have elected to account for the debt under the Revolving Credit Facility, which includes the 50% interest in policy proceeds to the lender, using the fair value method. The fair value of the debt is the amount the Company would have to pay to transfer the debt to a market participant in an orderly transaction. We calculated the fair value of the debt using a discounted cash flow model taking into account the stated interest rate of the credit facility and probabilistic cash flows from the pledged policies. Considerable judgment is required in interpreting market data to develop the estimates of fair value. Accordingly, our estimates are not necessarily indicative of the amounts that we, or holders of the instruments, could realize in a current market exchange. The most significant assumptions are the estimates of life expectancy of the insured and the discount rate. The use of different assumptions and/or estimation methodologies could have a material effect on the estimated fair values. | |||||
At September 30, 2014, the fair value of the outstanding debt was $142.7 million and the borrowing base was approximately $159.1 million, including $156.6 million in outstanding principal. | |||||
There are no scheduled repayments of principal prior to maturity. Payments are due upon receipt of death benefits and distributed pursuant to the waterfall as described above. |
Fair_Value_Measurements
Fair Value Measurements | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Fair Value Measurements | ' | ||||||||||||||||
(11) Fair Value Measurements | |||||||||||||||||
We carry investments in life settlements, certain structured settlements, and our Revolving Credit Facility debt at fair value in the consolidated balance sheets. Fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, fair value is a market based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. Fair value measurements are classified based on the following fair value hierarchy: | |||||||||||||||||
Level 1—Valuation is based on unadjusted quoted prices in active markets for identical assets and liabilities that are accessible at the reporting date. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these products does not entail a significant degree of judgment. | |||||||||||||||||
Level 2 —Valuation is determined from pricing inputs that are other than quoted prices in active markets that are either directly or indirectly observable as of the reporting date. Observable inputs include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, and interest rates and yield curves that are observable at commonly quoted intervals. | |||||||||||||||||
Level 3—Valuation is based on inputs that are both significant to the fair value measurement and unobservable. Level 3 inputs include situations where there is little, if any, market activity for the financial instrument. The inputs into the determination of fair value generally require significant management judgment or estimation. | |||||||||||||||||
Assets and liabilities measured at fair value on a recurring basis | |||||||||||||||||
The balances of the Company’s assets and liabilities measured at fair value on a recurring basis as of September 30, 2014, are as follows (in thousands): | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Fair Value | |||||||||||||||||
Assets: | |||||||||||||||||
Investment in life settlements | $ | — | $ | — | $ | 350,383 | $ | 350,383 | |||||||||
Structured settlement receivables | — | — | 383 | 383 | |||||||||||||
$ | — | $ | — | $ | 350,766 | $ | 350,766 | ||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Fair Value | |||||||||||||||||
Liabilities: | |||||||||||||||||
Revolving Credit Facility debt | $ | — | $ | — | $ | 142,661 | $ | 142,661 | |||||||||
$ | — | $ | — | $ | 142,661 | $ | 142,661 | ||||||||||
The balances of the Company’s assets and liabilities measured at fair value on a recurring basis as of December 31, 2013, are as follows (in thousands): | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Fair Value | |||||||||||||||||
Assets: | |||||||||||||||||
Investment in life settlements | $ | — | $ | — | $ | 302,961 | $ | 302,961 | |||||||||
Structured settlement receivables | — | — | 660 | 660 | |||||||||||||
$ | — | $ | — | $ | 303,621 | $ | 303,621 | ||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Fair Value | |||||||||||||||||
Liabilities: | |||||||||||||||||
Revolving Credit Facility debt | $ | — | $ | — | $ | 123,847 | $ | 123,847 | |||||||||
$ | — | $ | — | $ | 123,847 | $ | 123,847 | ||||||||||
The Company values its investment in life settlement portfolio in two classes, non-premium financed and premium financed. In considering the categories, it is generally believed that market participants would require a lower risk premium for policies that were non-premium financed, while a higher risk premium would be required for policies that were premium financed. | |||||||||||||||||
($ in thousands) | Quantitative Information about Level 3 Fair Value Measurements | ||||||||||||||||
Fair Value | Aggregate | Valuation Technique (s) | Unobservable Input | Range | |||||||||||||
at 9/30/14 | death benefit | (Weighted Average) | |||||||||||||||
at 9/30/14 | |||||||||||||||||
Non-premium financed | $ | 52,909 | $ | 220,802 | Discounted cash flow | Discount rate | 14.80% - 20.80% | ||||||||||
Life expectancy evaluation | (8.1 years) | ||||||||||||||||
Premium financed | $ | 297,474 | $ | 2,667,487 | Discounted cash flow | Discount rate Life | 16.55% - 26.55% | ||||||||||
expectancy evaluation | (11.2 years) | ||||||||||||||||
Investment in life settlements | $ | 350,383 | $ | 2,888,289 | Discounted cash flow | Discount rate Life | -18.56% | ||||||||||
expectancy evaluation | (11.0 years) | ||||||||||||||||
Structured settlements receivables | $ | 383 | N/A | Discounted cash flow | Facility sales discount rates | 8.66% | |||||||||||
Revolving Credit Facility debt | $ | 142,661 | N/A | Discounted cash flow | Discount rate Life | 24.01% * | |||||||||||
expectancy evaluation | (10.5 years) | ||||||||||||||||
* | Actual | ||||||||||||||||
Following is a description of the methodologies used to estimate the fair values of assets and liabilities measured at fair value on a recurring basis and within the fair value hierarchy. | |||||||||||||||||
Investment in life settlements—The Company has elected to account for the life settlement policies it acquires using the fair value method. The Company uses a present value technique to estimate the fair value of our investments in life settlements, which is a Level 3 fair value measurement as the significant inputs are unobservable and require significant management judgment or estimation. The Company currently uses a probabilistic method of valuing life insurance policies, which we believe to be the preferred valuation method in the industry. The most significant assumptions are the estimates of life expectancy of the insured and the discount rate. | |||||||||||||||||
The Company provides medical records for each insured to independent secondary market life expectancy providers (each, an “LE provider”). Each LE provider reviews and analyzes the medical records and identifies all medical conditions it feels are relevant to the life expectancy determination of the insured. Debits and credits are assigned by each LE provider to the individual’s health based on identified medical conditions. The debit or credit that an LE provider assigns to a medical condition is derived from the experience of mortality attributed to this condition in the portfolio of lives that the LE provider monitors. The health of the insured is summarized by the LE provider into a life assessment of the individual’s life expectancy expressed both in terms of months and in mortality factor. The mortality factor represents the degree to which the given life can be considered more or less impaired than a life having similar characteristics (e.g. gender, age, smoking, etc.). For example, a standard insured (the average life for the given mortality table) would carry a mortality rating of 100%. A similar but impaired life bearing a mortality rating of 200% would be considered to have twice the chance of dying earlier than the standard life relative to the LE provider’s population. Since each provider’s mortality factor is based on its own mortality table, the Company calculates its own factors to apply to the table selected by the Company. | |||||||||||||||||
Beginning in the quarter ended September 30, 2012, the Company began using the 2008 Valuation Basic Table (“2008 VBT”), a mortality table developed by the U.S. Society of Actuaries. The mortality table is created based on the expected rates of death among groups categorized by gender, age, and smoking status. Since the Company uses the 2008 VBT, the Company calculates its own mortality factor that, when applied to the 2008 VBT, produces the same life expectancy provided by each LE providers. The resulting mortality factors are then blended to determine a factor for each insured. | |||||||||||||||||
To generate best estimate probabilistic cash flow stream, a mortality curve is generated by calculating the probability of mortality for each period based on the calculated mortality factors and the death rates from the 2008 VBT. The company modifies the table by incorporating future mortality improvements to better reflect the curves used by the LE providers. | |||||||||||||||||
A discounted present value calculation is then used to determine the value of the policy. If the insured dies earlier than expected, the return will be higher than if the insured dies when expected or later than expected. | |||||||||||||||||
The calculation allows for the possibility that if the insured dies earlier than expected, the premiums needed to keep the policy in force will not have to be paid. Conversely, the calculation also considers the possibility that if the insured lives longer than expected, more premium payments will be necessary. Based on these considerations, each possible outcome is assigned a probability and the range of possible outcomes is then used to create a value for the policy. | |||||||||||||||||
The Company currently obtains its life expectancy reports from two life expectancy report providers, AVS Underwriting LLC (“AVS”) and 21st Services, LLC (“21st Services”). | |||||||||||||||||
In the first quarter of 2013, 21st Services announced revisions to its underwriting methodology. According to 21st Services, these revisions have generally been understood to lengthen the average reported life expectancy furnished by this life expectancy provider by 19%. As of September 30, 2014, the Company received 370 updated life expectancy reports from 21st Services, of which 332 were used to calculate life expectancy extension. These life expectancies reported an average lengthening of life expectancies of 15.80% and, based on this sample, for the nine months ended September 30, 2014, the Company increased the life expectancies furnished by 21st Services by 15.80% on the rest of its portfolio of life settlements prior to blending them with the life expectancy reports furnished by AVS. The Company expects to continue to lengthen life expectancies furnished by 21st Services that have not been re-underwritten using their updated methodology. Since the Revolving Credit Facility necessitates that the Company procure updated life expectancies on a periodic basis, the number of policies that are lengthened by the Company in this manner will decrease over time and the fair value calculations in future periods will, accordingly, reflect the actual impact of the revised 21st Services methodology on a policy by policy basis as updated life expectancy reports are procured. | |||||||||||||||||
Life expectancy sensitivity analysis | |||||||||||||||||
If all of the insured lives in the Company’s life settlement portfolio live six months shorter or longer than the life expectancies provided by these third parties, the change in estimated fair value would be as follows (dollars in thousands): | |||||||||||||||||
Life Expectancy Months Adjustment | Value | Change in Value | |||||||||||||||
6 | $ | 294,789 | $ | (55,594 | ) | ||||||||||||
- | 350,383 | $ | — | ||||||||||||||
-6 | $ | 411,117 | $ | 60,734 | |||||||||||||
Future changes in life expectancies could have a material effect on the fair value of our investment in life settlements, which could have a material adverse effect on our business, financial condition and results of operations. | |||||||||||||||||
Discount rate | |||||||||||||||||
The discount rate incorporates current information about market interest rates, the credit exposure to the insurance company that issued the life insurance policy and our estimate of the risk premium an investor in the policy would require. | |||||||||||||||||
The Company re-evaluates its discount rates at the end of every reporting period in order to reflect the estimated discount rates that could reasonably be used in a market transaction involving the Company’s portfolio of life insurance policies. In doing so, the Company relies on management insight, engages third party consultants to corroborate its assessment, engages in discussions with other market participants and potential financing sources and extrapolates the discount rate underlying actual sales of policies. | |||||||||||||||||
Due to the Company’s association with the USAO Investigation and certain civil litigation involving the Company, the Company believes that, when given the choice to invest in a policy that was associated with the Company’s premium finance business and a similar policy without such an association, all else being equal, an investor would have generally opted to invest in the policy that was not associated with the Company’s premium finance business. However, since the Company entered into a non-prosecution agreement, investors have required less of a risk premium to transact in policies associated with the Company’s legacy premium finance business. In general, the Company believes that the risk premium an investor would require to transact in a policy that has been premium financed versus a policy without premium financing is lessening in the current market environment and further expects that, with the passage of time, investors will continue to require less of a risk premium to transact in policies associated with its legacy premium finance business. | |||||||||||||||||
Credit exposure of insurance company | |||||||||||||||||
The Company considers the financial standing of the issuer of each life insurance policy. Typically, we seek to hold policies issued by insurance companies that are rated investment grade by the top three credit rating agencies. At September 30, 2014, the Company had nineteen life insurance policies issued by two carriers that were rated non-investment grade as of that date. In order to compensate a market participant for the perceived credit and challenge risks associated with these policies, the Company applied an additional 300 basis point risk premium. | |||||||||||||||||
The following table provides information about the life insurance issuer concentrations that exceed 10% of total death benefit and 10% of total fair value of our investments in life settlements as of September 30, 2014: | |||||||||||||||||
Carrier | Percentage of | Percentage of | Moody’s | S&P | |||||||||||||
Total | Total Death | Rating | Rating | ||||||||||||||
Fair Value | Benefit | ||||||||||||||||
Transamerica Occidental Life Insurance Company | 24.1 | % | 20.6 | % | A1 | AA- | |||||||||||
Lincoln National Life Insurance Company | 22.5 | % | 20.3 | % | A1 | AA- | |||||||||||
Lincoln Benefit Life Company | 10.7 | % | 10 | % | NR | * | BBB+ | ||||||||||
* | Not Rated | ||||||||||||||||
Estimated risk premium | |||||||||||||||||
As of September 30, 2014, the Company owned 595 policies with an aggregate investment in life settlements of $350.4 million. Of these 595 policies, 550 were premium financed and are valued using discount rates that range from 16.55% to 26.55%. The remaining 45 policies, which are non-premium financed, are valued using discount rates that range from 14.80% to 20.80%. As of September 30, 2014, the weighted average discount rate calculated based on death benefit used in valuing the policies in our life settlement portfolio was 18.56%. | |||||||||||||||||
The discount rate incorporates current information about market interest rates, the credit exposure to the insurance company that issued the life insurance policy and our estimate of the risk premium an investor in the policy would require. The extent to which the fair value could vary in the near term has been quantified by evaluating the effect of changes in the weighted average discount rate on the death benefit used to estimate the fair value. If the weighted average discount rate were increased or decreased by 1/2 of 1% and the other assumptions used to estimate fair value remained the same, the change in estimated fair value would be as follows (dollars in thousands): | |||||||||||||||||
Market interest rate sensitivity analysis | |||||||||||||||||
Weighted Average Rate Calculated Based on Death Benefit | Rate Adjustment | Value | Change in Value | ||||||||||||||
18.06% | -0.5 | % | $ | 360,030 | $ | 9,647 | |||||||||||
18.56% | — | $ | 350,383 | $ | — | ||||||||||||
19.06% | 0.5 | % | $ | 341,171 | $ | (9,212 | ) | ||||||||||
Future changes in the discount rates we use to value life insurance policies could have a material effect on our yield on life settlement transactions, which could have a material adverse effect on our business, financial condition and results of our operations. | |||||||||||||||||
At the end of each reporting period we re-value the life insurance policies using our valuation model in order to update our estimate of fair value for investments in policies held on our balance sheet. This includes reviewing our assumptions for discount rates and life expectancies as well as incorporating current information for premium payments and the passage of time. | |||||||||||||||||
Structured settlement receivables—All structured settlements that were acquired subsequent to July 1, 2010 were marked to fair value. We made this election because it was our intention to sell these assets within twelve months of acquisition. Structured settlements are purchased at effective yields that are fixed. Purchase discounts are accreted into interest income using the effective-interest method for those structured settlements marked to fair value. As of September 30, 2014, the Company had 17 structured settlements with an estimated fair value of $383,000 and an average sales discount rate of 8.66%. | |||||||||||||||||
Revolving Credit Facility debt—In connection with the Revolving Credit Facility, 452 policies are pledged by White Eagle to serve as collateral for its obligations under the facility. Absent an event of default under the Revolving Credit Facility, ongoing borrowings will be used to pay the premiums on these policies and certain approved third party expenses. Proceeds from the policies pledged as collateral will be distributed pursuant to a waterfall. After premium payments and fees to service providers, 100% of the remaining proceeds will be directed to pay outstanding principal and interest on the loan. Generally, after payment of principal and interest, collections from policy proceeds are to be paid to White Eagle up to $76.1 million, then 50% of the remaining proceeds are to be directed to the lenders with the remainder paid to White Eagle. We have elected to account for this long-term debt, which includes the lender’s interest in policy proceeds, using the fair value method. The fair value of the debt is the amount the Company would have to pay to transfer the debt to a market participant in an orderly transaction. We calculated the fair value of the debt using a discounted cash flow model taking into account the stated interest rate of the Revolving Credit Facility and probabilistic cash flows from the pledged policies. Accordingly, our estimates are not necessarily indicative of the amounts that we, or holders of the instruments, could realize in a current market exchange. The most significant assumptions are the estimates of life expectancy of the insured and the discount rate. The use of different assumptions and/or estimation methodologies could have a material effect on the estimated fair values. | |||||||||||||||||
Life expectancy sensitivity analysis of Revolving Credit Facility debt | |||||||||||||||||
A considerable portion of the fair value of the Revolving Credit Facility debt is determined by the timing of receipt of future policy proceeds. Should life expectancies lengthen such that policy proceeds are collected further into the future, the fair value of this debt will decline. Conversely, should life expectancies shorten, the fair value of this debt will increase. Considerable judgment is required in interpreting market data to develop the estimates of fair value. | |||||||||||||||||
If all of the insured lives in the life settlement portfolio pledged under the Revolving Credit Facility live six months shorter or longer than the life expectancies used to calculate the estimated fair value of the Revolving Credit Facility debt, the change in estimated fair value would be as follows (dollars in thousands): | |||||||||||||||||
Life Expectancy Months Adjustment | Fair Value of | Change in Value | |||||||||||||||
Revolving Credit | |||||||||||||||||
Facility Debt | |||||||||||||||||
6 | $ | 121,547 | $ | (21,114 | ) | ||||||||||||
- | $ | 142,661 | $ | — | |||||||||||||
-6 | $ | 165,172 | $ | 22,511 | |||||||||||||
Future changes in the life expectancies could have a material effect on the fair value of our Revolving Credit Facility debt, which could have a material adverse effect on our business, financial condition and results of operations. | |||||||||||||||||
Discount rate of Revolving Credit Facility debt | |||||||||||||||||
The discount rate incorporates current information about market interest rates, credit exposure to insurance companies and our estimate of the return a lender lending against the policies would require. | |||||||||||||||||
Market interest rate sensitivity analysis of Revolving Credit Facility debt | |||||||||||||||||
The extent to which the fair value of the Revolving Credit Facility debt could vary in the near term has been quantified by evaluating the effect of changes in the weighted average discount. If the weighted average discount rate were increased or decreased by 1/2 of 1% and the other assumptions used to estimate fair value remained the same, the change in estimated fair value of the Revolving Credit Facility debt as of September 30, 2014 would be as follows (dollars in thousands): | |||||||||||||||||
Discount Rate | Rate Adjustment | Fair Value of | Change in Value | ||||||||||||||
Revolving Credit | |||||||||||||||||
Facility Debt | |||||||||||||||||
23.51% | -0.5 | % | $ | 145,394 | $ | 2,733 | |||||||||||
24.01% | — | $ | 142,661 | $ | — | ||||||||||||
24.51% | 0.5 | % | $ | 140,020 | $ | (2,641 | ) | ||||||||||
Future changes in the discount rates could have a material effect on the fair value of our Revolving Credit Facility debt, which could have a material adverse effect on our business, financial condition and results of our operations. | |||||||||||||||||
At September 30, 2014, the fair value of the debt was $142.7 million and the outstanding principal was approximately $156.6 million. | |||||||||||||||||
Senior Unsecured Convertible Notes- The Company determined that an embedded conversion option in the Notes was required to be separately accounted for as a derivative under Accounting Standards Codification 815, Derivatives and Hedging (“ASC 815”). ASC 815 required the Company to bifurcate the embedded conversion option and record it as a liability at fair value and reduce the debt liability by a corresponding discount of an equivalent amount. The Company used a Black Scholes pricing model that incorporates present valuation techniques and reflect both the time value and the intrinsic value of the embedded conversion option to approximate the fair value of the conversion derivative liability at the end of each reporting period. This model required assumptions as to expected volatility, dividends, terms, and risk free rates. | |||||||||||||||||
In accordance with ASC 815, upon receipt of shareholder approval on June 5, 2014, the Company reclassified the embedded derivative to stockholders’ equity along with unamortized transaction costs proportionate to the allocation of the initial debt discount and the principal amount of the Notes. The Notes continue to be recorded at accreted value up to the par value of the Notes at maturity. See Note 10, “8.50% Senior Unsecured Convertible Notes.” Although we believe our valuation method is appropriate, the use of different methodologies or assumptions to determine the fair value could result in different fair values. | |||||||||||||||||
Changes in Fair Value | |||||||||||||||||
The following table provides a roll-forward in the changes in fair value for the nine months ended September 30, 2014, for assets for which the Company determines fair value using a material level of unobservable (Level 3) inputs (in thousands): | |||||||||||||||||
Life Settlements: | |||||||||||||||||
Balance, January 1, 2014 | $ | 302,961 | |||||||||||||||
Purchase of policies | $ | 3,488 | |||||||||||||||
Change in fair value | 19,313 | ||||||||||||||||
Matured/lapsed/sold policies | (15,957 | ) | |||||||||||||||
Premiums paid | 40,578 | ||||||||||||||||
Transfers into level 3 | |||||||||||||||||
Transfer out of level 3 | — | ||||||||||||||||
Balance, September 30, 2014 | $ | 350,383 | |||||||||||||||
Changes in fair value included in earnings for the period relating to assets held at September 30, 2014 | $ | 8,627 | |||||||||||||||
The following tables provide a roll-forward in the changes in fair value for nine months ended September 30, 2014, for all liabilities for which the Company determines fair value using a material level of unobservable (Level 3) inputs (in thousands): | |||||||||||||||||
Revolving Credit Facility debt: | |||||||||||||||||
Balance, January 1, 2014 | $ | 123,847 | |||||||||||||||
Subsequent Draws under the revolving credit facility | 40,965 | ||||||||||||||||
Payments on credit facility | (17,595 | ) | |||||||||||||||
Unrealized change in fair value | (4,556 | ) | |||||||||||||||
Transfers into level 3 | — | ||||||||||||||||
Transfer out of level 3 | — | ||||||||||||||||
Balance, September 30, 2014 | $ | 142,661 | |||||||||||||||
Changes in fair value included in earnings for the period relating to liabilities held at September 30, 2014 | $ | (4,556 | ) | ||||||||||||||
Conversion derivative liability: | |||||||||||||||||
Balance, at inception | 16,901 | ||||||||||||||||
Change in fair value | 6,759 | ||||||||||||||||
Reclassified to equity | (23,660 | ) | |||||||||||||||
Transfers into level 3 | — | ||||||||||||||||
Transfer out of level 3 | — | ||||||||||||||||
Balance, September 30, 2014 | $ | — | |||||||||||||||
Changes in fair value included in earnings for the period relating to liabilities held at September 30, 2014 | $ | — | |||||||||||||||
The following table provides a roll-forward in the changes in fair value for nine months ended September 30, 2013, for all assets for which the Company determines fair value using a material level of unobservable (Level 3) inputs (in thousands): | |||||||||||||||||
Life Settlements: | |||||||||||||||||
Balance, January 1, 2013 | $ | 113,441 | |||||||||||||||
Purchase of policies | $ | 55,500 | |||||||||||||||
Acquired in foreclosure | 3,168 | ||||||||||||||||
Change in fair value | 81,948 | ||||||||||||||||
Matured/lapsed/sold policies | (12,658 | ) | |||||||||||||||
Premiums paid | 50,984 | ||||||||||||||||
Transfers into level 3 | — | ||||||||||||||||
Transfer out of level 3 | — | ||||||||||||||||
Balance, September 30, 2013 | 292,383 | ||||||||||||||||
Changes in fair value included in earnings for the period relating to assets held at September 30, 2013 | $ | 74,655 | |||||||||||||||
The following table provides a roll-forward in the changes in fair value for nine months ended September 30, 2013, for all liabilities for which the Company determines fair value using a material level of unobservable (Level 3) inputs (in thousands): | |||||||||||||||||
Revolving Credit Facility debt: | |||||||||||||||||
Balance, January 1, 2013 | $ | — | |||||||||||||||
Initial advance under the revolving credit facility | $ | 83,020 | |||||||||||||||
Subsequent Draws under the revolving credit facility | 37,059 | ||||||||||||||||
Unrealized change in fair value | (5,295 | ) | |||||||||||||||
Transfers into level 3 | — | ||||||||||||||||
Transfer out of level 3 | — | ||||||||||||||||
Balance, September 30, 2013 | $ | 114,784 | |||||||||||||||
Changes in fair value included in earnings for the period relating to liabilities held at September 30, 2013 | $ | (5,295 | ) | ||||||||||||||
There were no transfers of financial assets or liabilities between levels of the fair value hierarchy during the nine months ended September 30, 2014 or 2013. |
Segment_Information
Segment Information | 9 Months Ended |
Sep. 30, 2014 | |
Segment Information | ' |
(12) Segment Information | |
On October 25, 2013, the Company sold its structured settlement business, which was previously reported as an operating segment. The operating results related to the Company’s structured settlement business have been included in discontinued operations in the Company’s Consolidated Statements of Operations for all periods presented and the Company has discontinued segment reporting. |
Commitments_and_Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2014 | |
Commitments and Contingencies | ' |
(13) Commitments and Contingencies | |
Lease Agreements | |
The Company leases office space under a new lease that commenced on October 1, 2014. The lease expires on September 30, 2020. The annual base rent is $225,100, with a provision for a 3% increase on each anniversary of the rent commencement date. Rent expense under the prior lease was approximately $126,000 for the three months ended September 30, 2014 and 2013 and $377,000 for the nine months ended September 30, 2014 and 2013. | |
Future minimum lease payments for the remainder of 2014 are approximately $49,000. | |
Employment Agreements | |
We have entered into employment agreements with certain of our officers, including with our chief executive officer, whose agreement provides for substantial payments in the event that the executive terminates his employment with us due to a material change in the geographic location where the chief executive officer performs his duties or upon a material diminution of his base salary or responsibilities, with or without cause. These payments are equal to three times the sum of our chief executive officer’s base salary and the average of the three years’ annual cash bonus. | |
On April 26, 2012, the Company entered into a Separation Agreement and General Release of Claims (the “Separation Agreement”) with its former chief operating officer, Jonathan Neuman. The Separation Agreement obligates the Company to indemnify Mr. Neuman for his legal expenses. The Company recognized indemnification expenses of $500,000 and $880,000 during the three months ended September 30, 2014 and 2013, respectively and $1.5 million and $2.3 million during the nine months ended September 30, 2014 and 2013, respectively. | |
We do not have any general policies regarding the use of employment agreements, but may, from time to time, enter into such a written agreement to reflect the terms and conditions of employment of a particular named executive officer, whether at the time of hire or thereafter. | |
Litigation | |
In accordance with applicable accounting guidance, the Company establishes an accrued liability for litigation and regulatory matters when those matters present loss contingencies that are both probable and estimable. In such cases, there may be an exposure to loss in excess of any amounts accrued. When a loss contingency is not both probable and estimable, the Company does not establish an accrued liability. As a litigation or regulatory matter develops, the Company, in conjunction with any outside counsel handling the matter, evaluates on an ongoing basis whether such matter presents a loss contingency that is probable and estimable. If, at the time of evaluation, the loss contingency related to a litigation or regulatory matter is not both probable and estimable, the matter will continue to be monitored for further developments that would make such loss contingency both probable and estimable. When a loss contingency related to a litigation or regulatory matter is deemed to be both probable and estimable, the Company will establish an accrued liability with respect to such loss contingency and record a corresponding amount of litigation-related expense. The Company will then continue to monitor the matter for further developments that could affect the amount of any such accrued liability. | |
Non-Prosecution Agreement | |
On September 27, 2011, the Company was informed that it was being investigated by the U.S. Attorney’s Office for the District of New Hampshire (the “USAO Investigation”). At that time, the Company was informed that, among other individuals, its former president and chief operating officer and, three former life finance sales executives were considered “targets” of the USAO Investigation. The USAO Investigation focused on the Company’s premium finance loan business. | |
On April 30, 2012, the Company entered into a Non-Prosecution Agreement (the “Non-Prosecution Agreement”) with the USAO, which agreed not to prosecute the Company for its involvement in the making of misrepresentations on life insurance applications in connection with its premium finance business or any potential securities fraud claims related to its premium finance business. In the Non-Prosecution Agreement, the USAO and the Company agreed among other things, that the following facts are true and correct: (i) at all relevant times (x) certain insurance companies required that the prospective insured applying for a life insurance policy, and sometimes the agent, disclose information relating to premium financing on applications for life insurance policies, and (y) the questions typically required the prospective insured to disclose if he or she intended to seek premium financing in connection with the policy and sometimes required the agent to disclose if he or she was aware of any such intent on the part of the applicant; (ii) in connection with a portion of the Company’s retail operation known as “retail non-seminar” that began in December 2006 and was discontinued in January 2009, Imperial had a practice of disclosing on applications that the prospective insured was seeking premium financing when the life insurance company allowed premium financing from Imperial; however, in certain circumstances, Imperial internal life agents facilitated and/or made misrepresentations on applications that the prospective insured was not seeking premium financing when the insurance carrier was likely to deny the policy on the basis of premium financing; and (iii) to the extent that external agents, brokers and insureds caused other misrepresentations to be made in life insurance applications in connection with the retail non-seminar business, Imperial failed to appropriately tailor controls to prevent potential fraudulent practices in that business. As of September 30, 2014, the Company had 39 policies in its portfolio that once served as collateral for premium finance loans derived through the retail non-seminar business. | |
In connection with the Non-Prosecution Agreement, Imperial voluntarily agreed to terminate its premium finance business, which historically accounted for the majority of the Company’s income and terminated certain senior sales staff associated with the premium finance business. Additionally, the Company paid the United States Government $8.0 million, and agreed to cooperate fully with the USAO’s ongoing investigation and to refrain from and self-report any criminal conduct. The Non-Prosecution Agreement has a term of three years until April 30, 2015, but the Company may petition the USAO to forego the remaining term of the Non-Prosecution Agreement, if the Company otherwise complies with all of its obligations under the Non-Prosecution Agreement. Should the USAO conclude that Imperial has not abided by its obligations under the Non-Prosecution Agreement, the USAO could choose to terminate the Non-Prosecution Agreement, resume its investigation of the Company, or bring charges against Imperial. While the Non-Prosecution Agreement effectively resolved the USAO Investigation as it pertains to the Company (subject to the Company’s continuing compliance with its terms), the USAO is continuing to investigate certain individuals formerly employed by the Company and the Company is continuing to incur expenses regarding its indemnification obligations with respect to such individuals. | |
In addition, settlements of certain civil litigation with the Company’s director and officer liability insurance carriers related to the USAO Investigation require Imperial to advance legal fees to and indemnify certain individuals. The obligation to advance and indemnify on behalf of these individuals, while currently unquantifiable, may be substantial and could have a material adverse effect on the Company’s financial position and results of operations. Excluding expenses of general external legal service providers, USAO litigation-related fees (inclusive of indemnification and advancement expenses) of $1.2 million and $1.6 million were recognized for the three months ended September 30, 2014 and 2013, respectively and $3.2 million and $4.6 million were recognized for the nine months ended September 30, 2014 and 2013, respectively. | |
Class Action Litigation | |
On December 16, 2013, final approval of the settlement to the class action designated Fuller v. Imperial Holdings et al. was granted by the United States District Court for the Southern District of Florida. The terms of the class action settlement included a cash payment of $12.0 million, with $11.0 million contributed by the Company’s primary and excess director and officer liability insurance carriers, with such amounts paid during the nine months ended September 30, 2014. The terms of the settlement also include the issuance of warrants to purchase two million shares of the Company’s stock. The warrants, which were issued into an escrow account in April 2014 and distributed in October 2014 have a five-year term from the date of their distribution and have an exercise price of $10.75. | |
SEC Investigation | |
On February 17, 2012, the Company first received a subpoena issued by the staff of the SEC seeking documents from 2007 through the date of the subpoena, generally related to the Company’s premium finance business and corresponding financial reporting. The SEC is investigating whether any violations of federal securities laws have occurred and the Company has been cooperating with the SEC regarding this matter. The Company is unable to predict what action, if any, might be taken in the future by the SEC or its staff as a result of the investigation or what impact, if any, the cost of responding to the SEC might have on the Company’s financial position, results of operations, or cash flows. The Company has not established any provision for losses in respect of this matter. | |
Sun Life | |
On April 18, 2013, Sun Life Assurance Company of Canada (“Sun Life”) filed a complaint against the Company and several of its affiliates in the United States District Court for the Southern District of Florida, entitled Sun Life Assurance Company of Canada v. Imperial Holdings, Inc., et al. (“Sun Life Case”). The complaint seeks to contest the validity of at least twenty-nine policies issued by Sun Life. The complaint also asserts the following claims: (1) violations of the federal Racketeer Influenced and Corrupt Organizations Act, (2) common law fraud, (3) civil conspiracy, (4) tortious interference with contractual obligations, and (5) an equitable accounting. In response to a motion to dismiss filed by the Company, Sun Life filed an amended complaint on June 13, 2013. The Company believes that the amended complaint is without merit and filed another motion to dismiss on July 8, 2013. Sun Life responded to the second motion to dismiss on August 1, 2013 and the Company filed its reply on August 19, 2013. On June 26, 2014, the District Court entered an order granting the Company’s motion to dismiss and dismissed Sun Life’s amended complaint, without prejudice. On July 28, 2014, Sun Life filed its second amended complaint. The Company believes the second amended complaint suffers from similar deficiencies as the previous complaints and filed another motion to dismiss on September 5, 2014. Sun Life filed its response on October 10, 2014 and the Company filed its reply on November 3, 2014. No reserve has been established for this litigation. | |
On July 29, 2013, the Company filed a complaint against Sun Life in United States District Court for the Southern District of Florida, entitled Imperial Premium Finance, LLC (“IPF”) v. Sun Life Assurance Company of Canada (“IPF Case”). The complaint asserts claims against Sun Life for breach of contract, breach of the covenant of good faith and fair dealing, and fraud, and seeks a judgment declaring that Sun Life is obligated to comply with the promises made by it in certain insurance policies. The complaint also seeks compensatory damages of no less than $30 million in addition to an award of punitive damages. On August 23, 2013, Sun Life moved to dismiss the complaint. IPF filed its response on September 9, 2013, and Sun Life filed its reply on September 19, 2013. The IPF Case has been consolidated with the Sun Life Case for all purposes, including trial. | |
Sanctions Order | |
On April 27, 2012, after the conclusion of a jury trial in the matter styled Steven A. Sciaretta, as Trustee of the Barton Cotton Irrevocable Trust a/k/a the Amended and Restated Barton Cotton Irrevocable Trust v. The Lincoln National Life Insurance Company (“Lincoln”), the defendant, Lincoln, filed a motion seeking sanctions against the Company’s subsidiary, Imperial Premium Finance (“IPF”), a non-party to the litigation, relating to its corporate representative deposition and trial testimony. On May 6, 2013, the Court issued an order sanctioning IPF and ordering it to pay $850,000. On June 4, 2013, IPF filed a Notice of Appeal and oral argument was held before the Eleventh Circuit Court of Appeals on October 7, 2014. The Company recorded a reserve of $850,000 that is included in other liabilities as of September 30, 2014. | |
IRS Investigation | |
As previously disclosed, the Internal Revenue Service (“IRS”) Criminal Investigation Division is conducting an investigation related to the Company and its legacy structured settlements business. The Company believes that it has been cooperating with the investigation and is unable, at this time, to predict what action, if any, might be taken in the future by the IRS or what impact, if any, the cost of providing information and documents might have on the Company’s financial condition, results of operations, or cash flows. If the investigation results in a determination by the IRS that the Company has failed to comply with any of its obligations under the Internal Revenue Code or regulations thereunder, the Company could incur additional tax liability, restitution payment obligations, penalties, fines or other liabilities, including criminal penalties and fines and a reduction in the Company’s net operating losses, that could have a material adverse effect on the Company, its personnel, its financial condition, its results of operations, or its cash flows. The Company has not established any provision for losses in respect to this matter. | |
Other Litigation | |
The Company is party to various other legal proceedings that arise in the ordinary course of business. Due to the inherent difficulty of predicting the outcome of litigation and other legal proceedings, the Company cannot predict the eventual outcome of these matters, and it is reasonably possible that some of them could be resolved unfavorably to the Company. As a result, it is possible that the Company’s results of operations or cash flows in a particular fiscal period could be materially affected by an unfavorable resolution of pending litigation or contingencies. However, the Company believes that the resolution of these other proceedings will not, based on information currently available, have a material adverse effect on the Company’s financial position or results of operations. |
Stockholders_Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2014 | |
Stockholders' Equity | ' |
(14) Stockholders’ Equity | |
The Company has reserved an aggregate of 1,200,000 shares of common stock under its Omnibus Plan, of which 815,448 options to purchase shares of common stock granted to existing employees were outstanding as of September 30, 2014, and an additional 61,853 shares of restricted stock, and 13,759 shares of unrestricted stock had been granted to directors under the plan subject to vesting. | |
On June 5, 2014, upon receipt of shareholder approval, the Company reclassified the embedded derivative contained in its Notes to stockholders’ equity along with unamortized transaction costs proportionate to the allocation of the initial debt discount and the principal amount of the Notes. This resulted in an increase to additional paid-in-capital of $14.1 million, net of taxes on the Company’s consolidated balance sheet and consolidated statement of stockholders’ equity as of September 30, 2014. See Note 10, 8.50% Senior Unsecured Convertible Notes. | |
In connection with the settlement of derivative litigation, the Company issued 125,628 shares of the Company’s stock, which were issued in the first quarter of 2014 and are included in stockholders’ equity. | |
In connection with the class action settlement described in Note 13, Contingencies and Commitments, the Company issued warrants to purchase two million shares of the Company’s stock into an escrow account in April 2014 and were distributed in October 2014. The estimated fair value at the measurement date of such warrants was $5.4 million, which is included in stockholder’s equity. The warrants have a five-year term from the date of their distribution with an exercise price of $10.75. The Company is obligated to file a registration statement to register the shares underlying the warrants with the SEC if shares of the Company’s common stock have an average daily trading closing price of at least $8.50 per share for a 45 day period. The warrants will be exercisable upon effectiveness of the registration statement. | |
During the nine months ended September 30, 2014, the Company awarded 299,500 target performance shares for restricted common stock to its directors and certain employees, of which 150,000 shares are subject to shareholder approval of an amendment to the Omnibus Plan at the Company’s 2015 annual meeting. The issuance of the performance shares is contingent on the Company’s financial performance as well as the performance of the Company’s common stock through June 30, 2016, with the actual shares to be issued ranging between 0 – 150% of the target performance shares. As a result, the Company determined that it is not probable that the performance conditions will be achieved and no related expense was recognized for the three and nine months ended September 30, 2014. The performance shares will be subject to a one year vesting period from the date of issuance. | |
Exclusive of those performance shares awarded to our named executive officers that are not subject to shareholder approval of an amendment to the Plan at the Company’s 2015 annual meeting, there were 308,940 securities remaining for future issuance under the Omnibus Plan as of September 30, 2014. | |
During the nine months ended September 30, 2014, the Company adopted ASU No. 2013-11, resulting in an increase to additional paid-in-capital of $6.3 million on the Company’s consolidated balance sheet and consolidated statement of stockholders’ equity as of September 30, 2014. See Note 3, Recent Accounting Pronouncements |
Income_Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2014 | |
Income Taxes | ' |
(15) Income Taxes | |
Our provision for income taxes, excluding the income tax expense of $3.7 million recorded as a result of the adoption of the new accounting pronouncement as discussed below, is estimated to result in an annual effective tax rate of 36.9% in 2014. For periods prior to 2014 our provision for income taxes was an annual effective tax rate of 0.0%. The 0.0% effective tax rate was the result of our recording of a valuation allowance for those deferred tax assets that were not expected to be recovered in the future. | |
Included in our provision for income taxes for the nine months ended September 30, 2014, is a $3.7 million provision attributed to the adoption of guidance provided in ASU No. 2013-11, that was effective on January 1, 2014. In addition, as a result of the adoption of this standard, the Company recorded a $6.3 million increase to additional paid-in-capital. | |
In March of 2014, the Company was notified by the IRS of its intention to examine the Company’s tax returns for the years ended December 31, 2011 and 2012. See also “IRS Investigation” in Note 13 regarding the IRS Criminal Investigation Division’s investigation related to the Company’s former structured settlement business. | |
The Company and its subsidiaries are subject to U.S. federal income tax as well as to income tax in Florida and other states and foreign jurisdictions in which it operates. | |
At the time the Company recorded a liability for the conversion derivative liability attributed to the issuance of the Notes, the Company recorded a deferred tax asset of $6.5 million for the conversion derivative liability and a deferred tax liability of $6.5 million for the corresponding debt discount. As the changes in the fair value of the conversion derivative liability are included in earnings, the Company recorded additions to the deferred tax asset. At June 5, 2014 when the Company received shareholder approval to issue shares of common stock upon conversion of the Notes, the deferred tax attributed to the conversion derivative liability (net of allocated unamortized transaction costs) was $8.8 million. In accordance with ASC 815, the Company reclassified the deferred tax asset attributed to the conversion derivative liability (net of allocated unamortized transaction costs) to equity. See Note 10, 8.50% Senior Unsecured Convertible Notes. As of September 30, 2014, the Company has a deferred tax liability of $6.2 million related to unamortized debt discount. |
Subsequent_Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2014 | |
Subsequent Events | ' |
(16) Subsequent Events | |
On November 10, 2014 (the “Initial Closing Date”), Imperial, as issuer, entered into an indenture with certain of its subsidiaries, Harbordale, LLC, Imperial Finance & Trading, LLC, Imperial Life and Annuity Services, LLC, Imperial Litigation Funding, LLC, Imperial Premium Finance, LLC, Red Reef Alternative Investments, LLC and Washington Square Financial, LLC, as guarantors (the “Guarantors”), and Wilmington Trust Company, as indenture trustee. The indenture provides for the issuance of up to $100 million in senior secured notes (the “Secured Notes”), of which $25 million was issued by Imperial on the Initial Closing Date. The Secured Notes issued on the Initial Closing Date were issued at 96% of their face amount and were purchased under a note purchase agreement (the “Note Purchase Agreement”) with Imperial and the Guarantors by an affiliate of Indaba Capital Management, L.P. (the “Purchaser”) in a private transaction pursuant to exemptions from the registration requirements of the Securities Act of 1933, as amended. The Note Purchase Agreement gives the Purchaser the right, subject to applicable law, to appoint one director to Imperial’s board of directors so long as it maintains a voting percentage of at least 5% of Imperial’s common stock and holds at least $25 million in principal amount or market value of Imperial’s debt. | |
Interest on issued Secured Notes accrues at 12.875% per annum and all Secured Notes issued under the indenture will mature 36 months from the Initial Closing Date (the “Initial Maturity”) although Imperial may elect to extend the maturity date by an additional 12 months (the “Extended Term”) and, if elected, interest on the Secured Notes will accrue at 14.5% during the Extended Term. The Secured Notes may not be optionally redeemed by Imperial for one year from the Initial Closing Date. Between the first and second anniversary of the Initial Closing Date, Imperial may optionally redeem the Secured Notes at 106% of the principal amount redeemed and thereafter at 104%, in each case, plus accrued and unpaid interest on the Secured Notes to the date of redemption. If Imperial does not elect the Extended Term, Secured Notes may be optionally redeemed within 60 days of the Initial Maturity at par plus accrued and unpaid interest up to the Initial Maturity. The Senior Notes are subject to mandatory prepayment provisions upon the issuance of additional debt and asset sales. In addition to usual and customary affirmative and negative covenants restricting additional debt, creation of liens, transactions with affiliates, and restrictions on certain payments and investments, the indenture governing the Secured Notes requires the Company to maintain a net worth of no less than $100 million and cash and cash equivalents of at least $20 million. | |
The Secured Notes may be used for general corporate purposes, are guaranteed by the Guarantors and are secured by substantially all of the Company’s and Guarantors’ assets, other than those securing the Revolving Credit Facility, including cash on account as well as the Company’s life insurance policies that are not pledged as collateral under the Revolving Credit Facility. The Secured Notes are also secured by pledges of the equity interests of the Guarantors and by pledges of 65% of their first tier foreign subsidiaries. | |
The Company may issue, and the Purchaser will be obligated to purchase, up to an additional $75 million in aggregate principal amount of Secured Notes in $25 million increments during the period ending on the 12-month anniversary of the Initial Closing Date provided certain performance conditions are met (in addition to usual and customary conditions precedent). The Company must deploy $25 million in investments following the Initial Closing Date to be eligible to issue the next $25 million of Secured Notes. Thereafter, the remaining $50 million in aggregate principal amount of Secured Notes may only be issued if the Company satisfies certain book and market value targets. Estimated fees and expenses payable by the Company at closing were approximately $1.9 million. Additionally, the Company will pay a draw-down fee of 1% of the amount of any subsequent issuance of Secured Notes and will pay a monthly unused fee on the unissued Secured Notes at a per annum rate of 1%. |
Principles_of_Consolidation_an1
Principles of Consolidation and Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2014 | |
Derivative Instruments | ' |
Derivative Instruments | |
The Company issued and sold $70.7 million in aggregate principal amount of 8.50% senior unsecured convertible notes due 2019 (the “Notes”). Prior to shareholder approval on June 5, 2014 to issue shares of common stock upon conversion of the Notes in excess of New York Stock Exchange limits for share issuances without shareholder approval, the Notes contained an embedded derivative feature. In accordance with Accounting Standards Codification (“ASC”) 815, Derivatives and Hedging, derivative instruments are recognized as either assets or liabilities on the Company’s balance sheet and are measured at fair value with gains or losses recognized in earnings. Embedded derivatives that are not clearly and closely related to the host contract, such as the Notes, are bifurcated and recognized at fair value with changes in fair value recognized as either a gain or loss in earnings if they can be reliably measured. The Company determined the fair value of its embedded derivative based upon available market data and unobservable inputs using a Black Scholes pricing model. In accordance with ASC 815, upon receipt of shareholder approval on June 5, 2014, the Company reclassified the embedded derivative to equity along with unamortized transaction costs proportionate to the allocation of the initial debt discount and the principal amount of the Notes. The Notes are recorded at accreted value and will continue to be accreted up to the par value of the Notes at maturity. See Note 10, 8.50% Senior Unsecured Convertible Notes. | |
Foreign Currency | ' |
Foreign Currency | |
The Company’s foreign subsidiaries are considered to be extensions of the U.S. Company and the U.S. dollar is utilized as the functional currency. The foreign subsidiaries’ financial statements are denominated in U.S. dollars and therefore, there are no translation gains and losses resulting from converting the financial statements at exchange rates other than the functional currency. Any gains and losses resulting from foreign currency transactions (transactions denominated in a currency other than the subsidiaries’ functional currency) are included in income. At this time, these gains and losses are immaterial to the Company’s financial statements. | |
Use of Estimates | ' |
Use of Estimates | |
The preparation of these consolidated financial statements, in conformity with generally accepted accounting principles in the United States of America (“GAAP”), requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from these estimates and such differences could be material. Significant estimates made by management include income taxes, the valuation of investments in life settlements, the valuation of the debt owing under the Revolving Credit Facility, the valuation of equity awards and the valuation of the conversion derivative liability formerly embedded within the Company’s Notes. |
Consolidation_of_Variable_Inte1
Consolidation of Variable Interest Entities (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Consolidated Assets and Consolidated Liabilities of VIEs | ' | ||||||||||||||||
The following table presents the consolidated assets and consolidated liabilities of VIEs for which the Company has concluded that it is the primary beneficiary and which are consolidated in the Company’s consolidated financial statements as of September 30, 2014 as well as non-consolidated VIEs for which the Company has determined it is not the primary beneficiary (in thousands): | |||||||||||||||||
Primary Beneficiary | Not Primary | ||||||||||||||||
Beneficiary | |||||||||||||||||
Consolidated VIEs | Non-consolidated VIEs | ||||||||||||||||
Assets | Liabilities | Total | Maximum Exposure | ||||||||||||||
Assets | To Loss | ||||||||||||||||
30-Sep-14 | $ | 300,116 | $ | 142,998 | $ | 2,385 | $2,385 | ||||||||||
31-Dec-13 | $ | 264,596 | $ | 124,188 | $ | 2,378 | $2,378 |
Earnings_Per_Share_Tables
Earnings Per Share (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Reconciliation of Actual Basic and Diluted Earnings Per Share | ' | ||||||||||||||||
The following tables reconcile actual basic and diluted earnings per share for the three months and nine months ended September 30, 2014 and 2013 (in thousands except share and per share data). | |||||||||||||||||
For the Three Months | For the Nine Months | ||||||||||||||||
Ended September 30, | Ended September 30, | ||||||||||||||||
2014(1) | 2013(2) | 2014(1) | 2013(2) | ||||||||||||||
Earnings per share: | |||||||||||||||||
Numerator: | |||||||||||||||||
Net (loss) income from continuing operations | $ | (4,264 | ) | $ | 6,106 | $ | (13,863 | ) | $ | 47,924 | |||||||
Net (loss) income income from discontinued operations | $ | (249 | ) | $ | 55 | $ | (454 | ) | $ | 1,627 | |||||||
Net (loss) income | $ | (4,513 | ) | $ | 6,161 | $ | (14,317 | ) | $ | 49,551 | |||||||
Basic earnings per common share: | |||||||||||||||||
Basic (loss) income from continuing operations | $ | (0.20 | ) | $ | 0.29 | $ | (0.65 | ) | $ | 2.26 | |||||||
Basic (loss )income from discontinued operations | $ | (0.01 | ) | — | $ | (0.02 | ) | $ | 0.08 | ||||||||
Basic (loss) income per share available to common shareholders | $ | (0.21 | ) | $ | 0.29 | $ | (0.67 | ) | $ | 2.34 | |||||||
Denominator: | |||||||||||||||||
Basic weighted average common shares outstanding | 21,361,930 | 21,219,880 | 21,352,086 | 21,215,344 | |||||||||||||
Diluted earnings per per common share: | |||||||||||||||||
Diluted (loss) income from continuing operations. | $ | (0.20 | ) | $ | 0.29 | $ | (0.65 | ) | $ | 2.26 | |||||||
Diluted (loss) income from discontinued operations | $ | (0.01 | ) | $ | — | $ | (0.02 | ) | $ | 0.08 | |||||||
Diluted (loss) income per share available to common shareholders | $ | (0.21 | ) | $ | 0.29 | $ | (0.67 | ) | $ | 2.34 | |||||||
Denominator: | |||||||||||||||||
Weighted average common shares outstanding | 21,361,930 | 21,219,880 | 21,352,086 | 21,215,344 | |||||||||||||
Add: Restricted Stock | — | 3,147 | — | 48 | |||||||||||||
Diluted weighted average shares outstanding | 21,361,930 | 21,223,027 | 21,352,086 | 21,215,392 | |||||||||||||
-1 | The computation of diluted EPS does not include 815,448 options, 6,240,521 warrants, 41,060 shares of restricted stock, up to 10,464,941 shares of underlying common stock issuable upon conversion of the Notes and 299,500 performance shares for the three months and nine months ended September 30, 2014, as the effect of their inclusion would have been anti-dilutive. | ||||||||||||||||
-2 | The computation of diluted EPS did not include 899,472 options, and 4,240,521 warrants for the three months and nine months ended September 30, 2013, as the effect of their inclusion would have been anti-dilutive. |
Stockbased_Compensation_Tables
Stock-based Compensation (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Common Stock Option Activity | ' | ||||||||||||||||
The following table presents the activity of the Company’s outstanding stock options of common stock for the nine months ended September 30, 2014: | |||||||||||||||||
Common Stock Options | Number of | Weighted | Weighted | Aggregate | |||||||||||||
Shares | Average Price | Average | Intrinsic | ||||||||||||||
per Share | Remaining | Value | |||||||||||||||
Contractual | |||||||||||||||||
Term | |||||||||||||||||
Options outstanding, January 1, 2014 | 831,282 | $ | 8.46 | 5.51 | — | ||||||||||||
Options granted | — | — | — | — | |||||||||||||
Options exercised | — | — | — | — | |||||||||||||
Options forfeited | (15,834 | ) | $ | 6.94 | 5.68 | — | |||||||||||
Options expired | — | — | — | — | |||||||||||||
Options outstanding, September 30, 2014 | 815,448 | $ | 8.49 | 4.74 | — | ||||||||||||
Exercisable at September 30, 2014 | 654,740 | $ | 8.87 | 4.51 | — | ||||||||||||
Unvested at September 30, 2014 | 160,708 | $ | 6.94 | 5.68 | — | ||||||||||||
Activity of Unvested Restricted Stock | ' | ||||||||||||||||
The following table presents the activity of the Company’s restricted stock for the nine months ended September 30, 2014: | |||||||||||||||||
Common Unvested Shares | Number of | ||||||||||||||||
Shares | |||||||||||||||||
Outstanding January 1, 2014 | 17,286 | ||||||||||||||||
Granted | 41,060 | ||||||||||||||||
Vested | (17,286 | ) | |||||||||||||||
Forfeited | — | ||||||||||||||||
Outstanding September 30, 2014 | 41,060 | ||||||||||||||||
Activity of Performance Share Awards | ' | ||||||||||||||||
The following table presents the activity of the Company’s performance share awards for the nine months ended September 30, 2014: | |||||||||||||||||
Performance Shares | Number of | ||||||||||||||||
Shares | |||||||||||||||||
Outstanding January 1, 2014 | — | ||||||||||||||||
Awarded | 299,500 | ||||||||||||||||
Vested | — | ||||||||||||||||
Forfeited | — | ||||||||||||||||
Outstanding September 30, 2014 | 299,500 | ||||||||||||||||
Discontinued_Operations_Tables
Discontinued Operations (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Operating Results of Discontinued Structured Settlement Business | ' | ||||||||||||||||
Operating results related to the Company’s discontinued structured settlement business are as follows: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Total income | $ | 38 | $ | 2,698 | $ | 150 | $ | 10,366 | |||||||||
Total expenses | (287 | ) | (2,643 | ) | (604 | ) | (8,739 | ) | |||||||||
(Loss) income before income taxes | (249 | ) | 55 | (454 | ) | 1,627 | |||||||||||
Income tax expense | — | — | — | — | |||||||||||||
Net (loss) income from discontinued operations | $ | (249 | ) | $ | 55 | $ | (454 | ) | $ | 1,627 | |||||||
Investment_in_Life_Settlements1
Investment in Life Settlements (Life Insurance Policies) (Tables) | 9 Months Ended | ||||||||||||
Sep. 30, 2014 | |||||||||||||
Investments in Life Settlements | ' | ||||||||||||
The weighted average life expectancy calculated based on death benefit of insureds in the policies owned by the Company at September 30, 2014 was 11.0 years. The following table describes the Company’s investments in life settlements as of September 30, 2014 (dollars in thousands): | |||||||||||||
Remaining Life Expectancy (In Years) | Number of | Fair | Face | ||||||||||
Life Settlement | Value | Value | |||||||||||
Contracts | |||||||||||||
0 - 1 | — | $ | — | $ | — | ||||||||
2-Jan | 2 | 3,727 | 5,377 | ||||||||||
3-Feb | 11 | 26,135 | 46,957 | ||||||||||
4-Mar | 9 | 11,642 | 29,800 | ||||||||||
5-Apr | 15 | 21,145 | 63,854 | ||||||||||
Thereafter | 558 | 287,734 | 2,742,301 | ||||||||||
Total | 595 | $ | 350,383 | $ | 2,888,289 | ||||||||
The weighted average life expectancy calculated based on death benefit of insureds in the policies owned by the Company at December 31, 2013 was 11.6 years. The following table describes the Company’s investments in life settlements as of December 31, 2013 (dollars in thousands): | |||||||||||||
Remaining Life Expectancy (In Years) | Number of | Fair Value | Face Value | ||||||||||
Life Settlement | |||||||||||||
Contracts | |||||||||||||
0 - 1 | — | $ | — | $ | — | ||||||||
2-Jan | — | — | — | ||||||||||
3-Feb | 6 | 8,489 | 16,875 | ||||||||||
4-Mar | 10 | 14,171 | 38,100 | ||||||||||
5-Apr | 8 | 13,529 | 40,250 | ||||||||||
Thereafter | 588 | 266,772 | 2,859,665 | ||||||||||
Total | 612 | $ | 302,961 | $ | 2,954,890 | ||||||||
Estimated Premiums To Be Paid | ' | ||||||||||||
Estimated premiums to be paid for the remainder of fiscal year 2014, the four succeeding fiscal years, and thereafter to keep the life insurance policies in force as of September 30, 2014, are as follows (in thousands): | |||||||||||||
Remainder of 2014 | $ | 13,436 | |||||||||||
2015 | 53,625 | ||||||||||||
2016 | 57,116 | ||||||||||||
2017 | 63,683 | ||||||||||||
2018 | 67,945 | ||||||||||||
Thereafter | 1,145,526 | ||||||||||||
$ | 1,401,331 | ||||||||||||
Debt_Disclosure_Tables
Debt Disclosure (Tables) | 9 Months Ended | ||||
Sep. 30, 2014 | |||||
Fair Value of Conversion Derivative Liability | ' | ||||
The fair value of the conversion derivative liability was estimated at June 5, 2014 using a Black Scholes pricing model with the following assumptions: | |||||
As of | |||||
June 5, 2014 | |||||
Expected Volatility | 40 | % | |||
Expected Term in Years | 4.7 | ||||
Risk Free Rate | 1.5 | % |
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Assets And Liabilities Measured at Fair Value on Recurring Basis | ' | ||||||||||||||||
The balances of the Company’s assets and liabilities measured at fair value on a recurring basis as of September 30, 2014, are as follows (in thousands): | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Fair Value | |||||||||||||||||
Assets: | |||||||||||||||||
Investment in life settlements | $ | — | $ | — | $ | 350,383 | $ | 350,383 | |||||||||
Structured settlement receivables | — | — | 383 | 383 | |||||||||||||
$ | — | $ | — | $ | 350,766 | $ | 350,766 | ||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Fair Value | |||||||||||||||||
Liabilities: | |||||||||||||||||
Revolving Credit Facility debt | $ | — | $ | — | $ | 142,661 | $ | 142,661 | |||||||||
$ | — | $ | — | $ | 142,661 | $ | 142,661 | ||||||||||
The balances of the Company’s assets and liabilities measured at fair value on a recurring basis as of December 31, 2013, are as follows (in thousands): | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Fair Value | |||||||||||||||||
Assets: | |||||||||||||||||
Investment in life settlements | $ | — | $ | — | $ | 302,961 | $ | 302,961 | |||||||||
Structured settlement receivables | — | — | 660 | 660 | |||||||||||||
$ | — | $ | — | $ | 303,621 | $ | 303,621 | ||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Fair Value | |||||||||||||||||
Liabilities: | |||||||||||||||||
Revolving Credit Facility debt | $ | — | $ | — | $ | 123,847 | $ | 123,847 | |||||||||
$ | — | $ | — | $ | 123,847 | $ | 123,847 | ||||||||||
Quantitative Information about Level 3 Fair Value Measurements | ' | ||||||||||||||||
($ in thousands) | Quantitative Information about Level 3 Fair Value Measurements | ||||||||||||||||
Fair Value | Aggregate | Valuation Technique (s) | Unobservable Input | Range | |||||||||||||
at 9/30/14 | death benefit | (Weighted Average) | |||||||||||||||
at 9/30/14 | |||||||||||||||||
Non-premium financed | $ | 52,909 | $ | 220,802 | Discounted cash flow | Discount rate | 14.80% - 20.80% | ||||||||||
Life expectancy evaluation | (8.1 years) | ||||||||||||||||
Premium financed | $ | 297,474 | $ | 2,667,487 | Discounted cash flow | Discount rate Life | 16.55% - 26.55% | ||||||||||
expectancy evaluation | (11.2 years) | ||||||||||||||||
Investment in life settlements | $ | 350,383 | $ | 2,888,289 | Discounted cash flow | Discount rate Life | -18.56% | ||||||||||
expectancy evaluation | (11.0 years) | ||||||||||||||||
Structured settlements receivables | $ | 383 | N/A | Discounted cash flow | Facility sales discount rates | 8.66% | |||||||||||
Revolving Credit Facility debt | $ | 142,661 | N/A | Discounted cash flow | Discount rate Life | 24.01% * | |||||||||||
expectancy evaluation | (10.5 years) | ||||||||||||||||
* | Actual | ||||||||||||||||
Life Insurance Issuer concentrations | ' | ||||||||||||||||
The following table provides information about the life insurance issuer concentrations that exceed 10% of total death benefit and 10% of total fair value of our investments in life settlements as of September 30, 2014: | |||||||||||||||||
Carrier | Percentage of | Percentage of | Moody’s | S&P | |||||||||||||
Total | Total Death | Rating | Rating | ||||||||||||||
Fair Value | Benefit | ||||||||||||||||
Transamerica Occidental Life Insurance Company | 24.1 | % | 20.6 | % | A1 | AA- | |||||||||||
Lincoln National Life Insurance Company | 22.5 | % | 20.3 | % | A1 | AA- | |||||||||||
Lincoln Benefit Life Company | 10.7 | % | 10 | % | NR | * | BBB+ | ||||||||||
* | Not Rated | ||||||||||||||||
Changes in Fair Value for All Assets Using Material Level of Unobservable (Level 3) Inputs | ' | ||||||||||||||||
The following table provides a roll-forward in the changes in fair value for the nine months ended September 30, 2014, for assets for which the Company determines fair value using a material level of unobservable (Level 3) inputs (in thousands): | |||||||||||||||||
Life Settlements: | |||||||||||||||||
Balance, January 1, 2014 | $ | 302,961 | |||||||||||||||
Purchase of policies | $ | 3,488 | |||||||||||||||
Change in fair value | 19,313 | ||||||||||||||||
Matured/lapsed/sold policies | (15,957 | ) | |||||||||||||||
Premiums paid | 40,578 | ||||||||||||||||
Transfers into level 3 | |||||||||||||||||
Transfer out of level 3 | — | ||||||||||||||||
Balance, September 30, 2014 | $ | 350,383 | |||||||||||||||
Changes in fair value included in earnings for the period relating to assets held at September 30, 2014 | $ | 8,627 | |||||||||||||||
The following table provides a roll-forward in the changes in fair value for nine months ended September 30, 2013, for all assets for which the Company determines fair value using a material level of unobservable (Level 3) inputs (in thousands): | |||||||||||||||||
Life Settlements: | |||||||||||||||||
Balance, January 1, 2013 | $ | 113,441 | |||||||||||||||
Purchase of policies | $ | 55,500 | |||||||||||||||
Acquired in foreclosure | 3,168 | ||||||||||||||||
Change in fair value | 81,948 | ||||||||||||||||
Matured/lapsed/sold policies | (12,658 | ) | |||||||||||||||
Premiums paid | 50,984 | ||||||||||||||||
Transfers into level 3 | — | ||||||||||||||||
Transfer out of level 3 | — | ||||||||||||||||
Balance, September 30, 2013 | 292,383 | ||||||||||||||||
Changes in fair value included in earnings for the period relating to assets held at September 30, 2013 | $ | 74,655 | |||||||||||||||
Changes in Fair Value for All Liabilities Using Material Level of Unobservable (Level 3) Inputs | ' | ||||||||||||||||
The following tables provide a roll-forward in the changes in fair value for nine months ended September 30, 2014, for all liabilities for which the Company determines fair value using a material level of unobservable (Level 3) inputs (in thousands): | |||||||||||||||||
Revolving Credit Facility debt: | |||||||||||||||||
Balance, January 1, 2014 | $ | 123,847 | |||||||||||||||
Subsequent Draws under the revolving credit facility | 40,965 | ||||||||||||||||
Payments on credit facility | (17,595 | ) | |||||||||||||||
Unrealized change in fair value | (4,556 | ) | |||||||||||||||
Transfers into level 3 | — | ||||||||||||||||
Transfer out of level 3 | — | ||||||||||||||||
Balance, September 30, 2014 | $ | 142,661 | |||||||||||||||
Changes in fair value included in earnings for the period relating to liabilities held at September 30, 2014 | $ | (4,556 | ) | ||||||||||||||
Conversion derivative liability: | |||||||||||||||||
Balance, at inception | 16,901 | ||||||||||||||||
Change in fair value | 6,759 | ||||||||||||||||
Reclassified to equity | (23,660 | ) | |||||||||||||||
Transfers into level 3 | — | ||||||||||||||||
Transfer out of level 3 | — | ||||||||||||||||
Balance, September 30, 2014 | $ | — | |||||||||||||||
Changes in fair value included in earnings for the period relating to liabilities held at September 30, 2014 | $ | — | |||||||||||||||
The following table provides a roll-forward in the changes in fair value for nine months ended September 30, 2013, for all liabilities for which the Company determines fair value using a material level of unobservable (Level 3) inputs (in thousands): | |||||||||||||||||
Revolving Credit Facility debt: | |||||||||||||||||
Balance, January 1, 2013 | $ | — | |||||||||||||||
Initial advance under the revolving credit facility | $ | 83,020 | |||||||||||||||
Subsequent Draws under the revolving credit facility | 37,059 | ||||||||||||||||
Unrealized change in fair value | (5,295 | ) | |||||||||||||||
Transfers into level 3 | — | ||||||||||||||||
Transfer out of level 3 | — | ||||||||||||||||
Balance, September 30, 2013 | $ | 114,784 | |||||||||||||||
Changes in fair value included in earnings for the period relating to liabilities held at September 30, 2013 | $ | (5,295 | ) | ||||||||||||||
Market Approach Valuation Technique | ' | ||||||||||||||||
Market Interest Rate Sensitivity Analysis | ' | ||||||||||||||||
Market interest rate sensitivity analysis | |||||||||||||||||
Weighted Average Rate Calculated Based on Death Benefit | Rate Adjustment | Value | Change in Value | ||||||||||||||
18.06% | -0.5 | % | $ | 360,030 | $ | 9,647 | |||||||||||
18.56% | — | $ | 350,383 | $ | — | ||||||||||||
19.06% | 0.5 | % | $ | 341,171 | $ | (9,212 | ) | ||||||||||
Changes in estimated fair value, If all of the insured lives in the Company's life settlement portfolio live six months longer than the life expectancies provided by third parties. | ' | ||||||||||||||||
Life Expectancies | ' | ||||||||||||||||
If all of the insured lives in the Company’s life settlement portfolio live six months shorter or longer than the life expectancies provided by these third parties, the change in estimated fair value would be as follows (dollars in thousands): | |||||||||||||||||
Life Expectancy Months Adjustment | Value | Change in Value | |||||||||||||||
6 | $ | 294,789 | $ | (55,594 | ) | ||||||||||||
- | 350,383 | $ | — | ||||||||||||||
-6 | $ | 411,117 | $ | 60,734 | |||||||||||||
Revolving Credit Facility | Market Approach Valuation Technique | ' | ||||||||||||||||
Market Interest Rate Sensitivity Analysis | ' | ||||||||||||||||
If the weighted average discount rate were increased or decreased by 1/2 of 1% and the other assumptions used to estimate fair value remained the same, the change in estimated fair value of the Revolving Credit Facility debt as of September 30, 2014 would be as follows (dollars in thousands): | |||||||||||||||||
Discount Rate | Rate Adjustment | Fair Value of | Change in Value | ||||||||||||||
Revolving Credit | |||||||||||||||||
Facility Debt | |||||||||||||||||
23.51% | -0.5 | % | $ | 145,394 | $ | 2,733 | |||||||||||
24.01% | — | $ | 142,661 | $ | — | ||||||||||||
24.51% | 0.5 | % | $ | 140,020 | $ | (2,641 | ) | ||||||||||
Revolving Credit Facility | Changes in estimated fair value, If all of the insured lives in the Company's life settlement portfolio live six months longer than the life expectancies provided by third parties. | ' | ||||||||||||||||
Life Expectancies | ' | ||||||||||||||||
If all of the insured lives in the life settlement portfolio pledged under the Revolving Credit Facility live six months shorter or longer than the life expectancies used to calculate the estimated fair value of the Revolving Credit Facility debt, the change in estimated fair value would be as follows (dollars in thousands): | |||||||||||||||||
Life Expectancy Months Adjustment | Fair Value of | Change in Value | |||||||||||||||
Revolving Credit | |||||||||||||||||
Facility Debt | |||||||||||||||||
6 | $ | 121,547 | $ | (21,114 | ) | ||||||||||||
- | $ | 142,661 | $ | — | |||||||||||||
-6 | $ | 165,172 | $ | 22,511 |
Description_of_Business_Additi
Description of Business - Additional Information (Detail) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Apr. 29, 2013 | Sep. 30, 2014 |
In Thousands, unless otherwise specified | Contract | Contract | Revolving Credit Facility | Revolving Credit Facility |
Securities | Securities Pledged as Collateral | |||
Contract | ||||
Organization and Nature of Operations [Line Items] | ' | ' | ' | ' |
Number of policies owned | 595 | 612 | 452 | 452 |
Life insurance estimated fair value | $350,383 | $302,961 | ' | $295,500 |
Life insurance policies with aggregate death benefit | $2,888,289 | $2,954,890 | ' | $2,300,000 |
Revolving credit facility period | ' | ' | ' | '15 years |
Principles_of_Consolidation_an2
Principles of Consolidation and Basis of Presentation - Additional Information (Detail) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Feb. 28, 2014 | Apr. 29, 2013 | Sep. 30, 2014 |
Contract | Contract | 8.50% Senior Unsecured Convertible Notes Due 2019 | 8.50% Senior Unsecured Convertible Notes Due 2019 | Revolving Credit Facility | Revolving Credit Facility | |
Securities | Securities Pledged as Collateral | |||||
Contract | ||||||
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items] | ' | ' | ' | ' | ' | ' |
Number of policies owned | 595 | 612 | ' | ' | 452 | 452 |
Life insurance policies with aggregate death benefit | $2,888,289,000 | $2,954,890,000 | ' | ' | ' | $2,300,000,000 |
Life insurance estimated fair value | 350,383,000 | 302,961,000 | ' | ' | ' | 295,500,000 |
Debt instrument issued | ' | ' | $70,700,000 | $70,700,000 | ' | ' |
Debt instrument, stated interest rate | ' | ' | 8.50% | 8.50% | ' | ' |
Recovered_Sheet1
Recent Accounting pronouncements - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Jan. 01, 2014 | Sep. 30, 2014 | |
ASU No. 2013-11 | ASU No. 2013-11 | |||||
Accounting Policies [Line Items] | ' | ' | ' | ' | ' | ' |
Provision for income taxes | ($2,235,000) | $0 | ($2,452,000) | $40,000 | ' | $3,700,000 |
Reduction in valuation allowance | ' | ' | ' | ' | ' | 2,600,000 |
Increase to additional paid-in-capital | ' | ' | ' | ' | ' | 6,300,000 |
Reclassification of current liability for unrecognized tax benefits to deferred taxes | ' | ' | ' | ' | $6,300,000 | ' |
Consolidated_Assets_and_Consol
Consolidated Assets and Consolidated Liabilities of VIEs (Detail) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Primary Beneficiary Variable Interest Entity | ' | ' |
Variable Interest Entity [Line Items] | ' | ' |
Primary Beneficiary Consolidated VIEs, assets | $300,116 | $264,596 |
Primary Beneficiary Consolidated VIEs, liabilities | 142,998 | 124,188 |
Not Primary Beneficiary Variable Interest Entity | ' | ' |
Variable Interest Entity [Line Items] | ' | ' |
Not Primary Beneficiary Non-consolidated VIEs, total assets | 2,385 | 2,378 |
Not Primary Beneficiary Non-consolidated VIEs, Maximum Exposure to Loss | $2,385 | $2,378 |
Consolidation_of_Variable_Inte2
Consolidation of Variable Interest Entities - Additional Information (Detail) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Apr. 29, 2013 | Sep. 30, 2014 |
In Thousands, unless otherwise specified | Contract | Contract | Revolving Credit Facility | Revolving Credit Facility |
Securities | Securities Pledged as Collateral | |||
Contract | ||||
Variable Interest Entity [Line Items] | ' | ' | ' | ' |
Number of policies owned | 595 | 612 | 452 | 452 |
Life insurance policies with aggregate death benefit | $2,888,289 | $2,954,890 | ' | $2,300,000 |
Life insurance estimated fair value | $350,383 | $302,961 | ' | $295,500 |
Reconciliation_of_Actual_Basic
Reconciliation of Actual Basic and Diluted Earnings Per Share (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||||||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | ||||
Numerator: | ' | ' | ' | ' | ||||
Net (loss) income from continuing operations | ($4,264) | [1] | $6,106 | [2] | ($13,863) | [1] | $47,924 | [2] |
Net (loss) income income from discontinued operations | -249 | [1] | 55 | [2] | -454 | [1] | 1,627 | [2] |
Net (loss) income | ($4,513) | [1] | $6,161 | [2] | ($14,317) | [1] | $49,551 | [2] |
Basic earnings per common share: | ' | ' | ' | ' | ||||
Basic (loss) income from continuing operations | ($0.20) | [1] | $0.29 | [2] | ($0.65) | [1] | $2.26 | [2] |
Basic (loss )income from discontinued operations | ($0.01) | [1] | $0 | [2] | ($0.02) | [1] | $0.08 | [2] |
Basic (loss) income per share available to common shareholders | ($0.21) | [1] | $0.29 | [2] | ($0.67) | [1] | $2.34 | [2] |
Diluted earnings per per common share: | ' | ' | ' | ' | ||||
Diluted (loss) income from continuing operations. | ($0.20) | [1] | $0.29 | [2] | ($0.65) | [1] | $2.26 | [2] |
Diluted (loss) income from discontinued operations | ($0.01) | [1] | $0 | [2] | ($0.02) | [1] | $0.08 | [2] |
Diluted (loss) income per share available to common shareholders | ($0.21) | [1] | $0.29 | [2] | ($0.67) | [1] | $2.34 | [2] |
Denominator: | ' | ' | ' | ' | ||||
Weighted average common shares outstanding | 21,361,930 | [1] | 21,219,880 | [2] | 21,352,086 | [1] | 21,215,344 | [2] |
Add: Restricted Stock | ' | 3,147 | [2] | ' | 48 | [2] | ||
Diluted weighted average shares outstanding | 21,361,930 | [1] | 21,223,027 | [2] | 21,352,086 | [1] | 21,215,392 | [2] |
[1] | The computation of diluted EPS does not include 815,448 options, 6,240,521 warrants, 41,060 shares of restricted stock, up to 10,464,941 shares of underlying common stock issuable upon conversion of the Notes and 299,500 performance shares for the three months and nine months ended September 30, 2014, as the effect of their inclusion would have been anti-dilutive. | |||||||
[2] | The computation of diluted EPS did not include 899,472 options, and 4,240,521 warrants for the three months and nine months ended September 30, 2013, as the effect of their inclusion would have been anti-dilutive. |
Reconciliation_of_Actual_Basic1
Reconciliation of Actual Basic and Diluted Earnings Per Share (Parenthetical) (Detail) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | |
Stock Option | ' | ' | ' | ' |
Schedule of Earnings Per Share, Basic and Diluted, by Common Class [Line Items] | ' | ' | ' | ' |
Antidilutive securities excluded from computation of diluted earnings per share | 815,448 | 899,472 | 815,448 | 899,472 |
Warrant | ' | ' | ' | ' |
Schedule of Earnings Per Share, Basic and Diluted, by Common Class [Line Items] | ' | ' | ' | ' |
Antidilutive securities excluded from computation of diluted earnings per share | 6,240,521 | 4,240,521 | 6,240,521 | 4,240,521 |
Restricted Stock | ' | ' | ' | ' |
Schedule of Earnings Per Share, Basic and Diluted, by Common Class [Line Items] | ' | ' | ' | ' |
Antidilutive securities excluded from computation of diluted earnings per share | 41,060 | ' | 41,060 | ' |
Performance Shares | ' | ' | ' | ' |
Schedule of Earnings Per Share, Basic and Diluted, by Common Class [Line Items] | ' | ' | ' | ' |
Antidilutive securities excluded from computation of diluted earnings per share | 299,500 | ' | 299,500 | ' |
Maximum | Convertible Debt Securities | ' | ' | ' | ' |
Schedule of Earnings Per Share, Basic and Diluted, by Common Class [Line Items] | ' | ' | ' | ' |
Antidilutive securities excluded from computation of diluted earnings per share | 10,464,941 | ' | 10,464,941 | ' |
StockBased_Compensation_Additi
Stock-Based Compensation - Additional Information (Detail) (USD $) | 0 Months Ended | 1 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 0 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 0 Months Ended | 12 Months Ended | 9 Months Ended | |||||||||||||||||
Feb. 11, 2011 | Apr. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Feb. 11, 2011 | Sep. 30, 2014 | Feb. 11, 2011 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2011 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Feb. 11, 2011 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Apr. 01, 2013 | Dec. 31, 2013 | Apr. 01, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | |
Including Overallotment Option | Maximum | Minimum | 2014 | 2015 | Omnibus Plan | Omnibus Plan | Omnibus Plan | Stock Options | Stock Options | Stock Options | Stock Options | Restricted Stock | Restricted Stock | Restricted Stock | Restricted Stock | Restricted Stock | Restricted Stock | Restricted Stock | Restricted Stock | Restricted Stock | Restricted Stock | Unrestricted Stock | Unrestricted Stock | Unrestricted Stock | Performance Shares | Performance Shares | Performance Shares | Performance Shares | |||||||
Including Overallotment Option | Omnibus Plan | Omnibus Plan | Omnibus Plan | Omnibus Plan | Omnibus Plan | Omnibus Plan | Omnibus Plan | Omnibus Plan | Omnibus Plan | Omnibus Plan | Omnibus Plan | Omnibus Plan | Omnibus Plan | Omnibus Plan | Omnibus Plan | Omnibus Plan | Omnibus Plan | Omnibus Plan | Omnibus Plan | ||||||||||||||||
Restricted Stock One | Restricted Stock One | Restricted Stock Two | Restricted Stock Two | Maximum | Minimum | ||||||||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shares of common stock reserved for future grant | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options outstanding and unexercised, weighted average price | ' | ' | $8.49 | ' | $8.46 | ' | ' | ' | ' | ' | ' | ' | $10.75 | $8.49 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options outstanding and unexercised, expiry period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '7 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options outstanding and unexercised, vesting period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '3 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year | ' | ' |
Stock granted | ' | ' | 41,060 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 61,853 | ' | ' | 41,060 | ' | ' | ' | ' | ' | 13,759 | 13,759 | ' | 299,500 | 299,500 | ' | ' |
Fair value of stock granted | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $254,983 | ' | $254,983 | ' | ' | ' | ' | ' | ' | ' | $57,000 | ' | ' | ' | ' |
Options granted | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 545,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options granted strike price | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $6.94 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock-based compensation expense | ' | ' | 762,000 | 1,203,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 140,000 | 118,000 | 632,000 | 1,100,000 | ' | ' | 61,000 | 30,000 | 130,000 | 39,000 | 0 | 52,000 | 61,000 | 78,000 | ' | ' | ' | ' | ' | ' | ' |
Stock granted, subject to shareholders' approval of an amendment and restatement | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 150,000 | ' | ' |
Actual shares to be issued | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 150.00% | 0.00% |
Options outstanding and unexercised | ' | ' | 815,448 | ' | 831,282 | ' | ' | ' | ' | ' | ' | ' | ' | 815,448 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Remaining unamortized amounts | ' | ' | ' | ' | ' | ' | ' | ' | ' | 140,000 | 239,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock vested | ' | ' | 17,286 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 17,286 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fair value of stock vested | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 120,138 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restricted stock, aggregate intrinsic value | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 265,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restricted stock, vesting period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '2015-06 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expected issuance of warrants for shares | ' | 2,000,000 | ' | ' | ' | ' | ' | 4,240,521 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Exercise price of warrants | ' | ' | 10.75 | ' | ' | 14.51 | 14.51 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Warrant expiration period | '7 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Warrant vesting period | '4 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Warrants issued | ' | ' | ' | ' | ' | ' | 3,180,391 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated Fair Value Of Warrants | ' | ' | $5,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock warrants term | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Average daily trading closing price | ' | ' | ' | ' | ' | ' | ' | ' | $8.50 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Average daily trading closing price, period | ' | ' | ' | ' | ' | ' | ' | ' | '45 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common_Stock_Options_Activity_
Common Stock Options Activity (Detail) (USD $) | 6 Months Ended | 9 Months Ended |
Jun. 30, 2014 | Sep. 30, 2014 | |
Number of Shares | ' | ' |
Options outstanding, Beginning Balance | 831,282 | 831,282 |
Options granted | ' | ' |
Options exercised | ' | ' |
Options forfeited | ' | -15,834 |
Options expired | ' | ' |
Options outstanding, Ending Balance | ' | 815,448 |
Exercisable at end of period | ' | 654,740 |
Unvested at end of period | ' | 160,708 |
Weighted Average Price per Share | ' | ' |
Options outstanding, Beginning Balance | $8.46 | $8.46 |
Options granted | ' | ' |
Options exercised | ' | ' |
Options forfeited | ' | $6.94 |
Options expired | ' | ' |
Options outstanding, Ending Balance | ' | $8.49 |
Exercisable at end of period | ' | $8.87 |
Unvested at end of period | ' | $6.94 |
Weighted Average Remaining Contractual Term | ' | ' |
Options forfeited | ' | '5 years 8 months 5 days |
Options outstanding, Beginning Balance | '5 years 6 months 4 days | '4 years 8 months 27 days |
Exercisable at end of period | ' | '4 years 6 months 4 days |
Unvested at end of period | ' | '5 years 8 months 5 days |
Aggregate Intrinsic Value | ' | ' |
Options outstanding, Beginning Balance | ' | ' |
Options granted | ' | ' |
Options exercised | ' | ' |
Options forfeited | ' | ' |
Options expired | ' | ' |
Options outstanding, Ending Balance | ' | ' |
Exercisable at end of period | ' | ' |
Unvested at end of period | ' | ' |
Activity_of_Unvested_Restricte
Activity of Unvested Restricted Stock (Detail) | 9 Months Ended |
Sep. 30, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Beginning balance | 17,286 |
Granted | 41,060 |
Vested | -17,286 |
Forfeited | ' |
Common Unvested Shares outstanding, Ending Balance | 41,060 |
Activity_of_Performance_Share_
Activity of Performance Share Awards (Detail) | 9 Months Ended |
Sep. 30, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Beginning balance | 17,286 |
Awarded | 41,060 |
Vested | 17,286 |
Forfeited | ' |
Common Unvested Shares outstanding, Ending Balance | 41,060 |
Performance Shares | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Awarded | 299,500 |
Vested | ' |
Forfeited | ' |
Common Unvested Shares outstanding, Ending Balance | 299,500 |
Discontinued_Operations_Additi
Discontinued Operations - Additional Information (Detail) (Structured settlements, USD $) | 1 Months Ended | 3 Months Ended |
In Millions, unless otherwise specified | Oct. 25, 2013 | Dec. 31, 2013 |
Structured settlements | ' | ' |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' |
Sale of structured settlement business | $12 | ' |
Recognized a gain on structured settlement assets | ' | $11.30 |
Operating_Results_of_Structure
Operating Results of Structured Settlement Business (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' | ' | ' | ||||
Total income | $38 | $2,698 | $150 | $10,366 | ||||
Total expenses | -287 | -2,643 | -604 | -8,739 | ||||
(Loss) income before income taxes | -249 | 55 | -454 | 1,627 | ||||
Income tax expense | ' | ' | ' | ' | ||||
Net (loss) income from discontinued operations | ($249) | [1] | $55 | [2] | ($454) | [1] | $1,627 | [2] |
[1] | The computation of diluted EPS does not include 815,448 options, 6,240,521 warrants, 41,060 shares of restricted stock, up to 10,464,941 shares of underlying common stock issuable upon conversion of the Notes and 299,500 performance shares for the three months and nine months ended September 30, 2014, as the effect of their inclusion would have been anti-dilutive. | |||||||
[2] | The computation of diluted EPS did not include 899,472 options, and 4,240,521 warrants for the three months and nine months ended September 30, 2013, as the effect of their inclusion would have been anti-dilutive. |
Investment_in_Life_Settlements2
Investment in Life Settlements (Life Insurance Policies) - Additional Information (Detail) (USD $) | 9 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Dec. 31, 2013 |
Contract | Contract | |
Life Insurance Premiums and Related Investment Income [Line Items] | ' | ' |
Number of policies owned | 595 | 612 |
Life insurance estimated fair value | $350,383 | $302,961 |
Average life expectancy of insured | '11 years | '11 years 7 months 6 days |
Estimated future premium payments | $1,401,331 | ' |
Investments_in_Life_Settlement
Investments in Life Settlements (Detail) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | Contract | Contract |
Number of Life Settlement Contracts | ' | ' |
0 - 1 | ' | ' |
2-Jan | 2 | ' |
3-Feb | 11 | 6 |
4-Mar | 9 | 10 |
5-Apr | 15 | 8 |
Thereafter | 558 | 588 |
Total | 595 | 612 |
Fair Value | ' | ' |
0 - 1 | ' | ' |
2-Jan | 3,727 | ' |
3-Feb | 26,135 | 8,489 |
4-Mar | 11,642 | 14,171 |
5-Apr | 21,145 | 13,529 |
Thereafter | 287,734 | 266,772 |
Total | 350,383 | 302,961 |
Face Value | ' | ' |
0 - 1 | ' | ' |
2-Jan | 5,377 | ' |
3-Feb | 46,957 | 16,875 |
4-Mar | 29,800 | 38,100 |
5-Apr | 63,854 | 40,250 |
Thereafter | 2,742,301 | 2,859,665 |
Total | $2,888,289 | $2,954,890 |
Estimated_Premiums_to_be_Paid_
Estimated Premiums to be Paid (Detail) (USD $) | Sep. 30, 2014 |
In Thousands, unless otherwise specified | |
Life Insurance Premiums and Related Investment Income [Line Items] | ' |
Remainder of 2014 | $13,436 |
2015 | 53,625 |
2016 | 57,116 |
2017 | 63,683 |
2018 | 67,945 |
Thereafter | 1,145,526 |
Estimated future premium payments | $1,401,331 |
Revolving_Credit_Facility_Addi
Revolving Credit Facility - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | 0 Months Ended | 1 Months Ended | 3 Months Ended | 9 Months Ended | 0 Months Ended | 1 Months Ended | ||||||||||||||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | 16-May-14 | Apr. 29, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | 16-May-14 | 16-May-14 | 16-May-14 | 16-May-14 | 16-May-14 | 16-May-14 | Sep. 30, 2014 | 16-May-14 | 16-May-14 | 16-May-14 | 16-May-14 | Apr. 29, 2013 | 16-May-14 | |
Contract | Contract | Contract | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | |||
Securities | Maintenance Costs | Accrued and Unpaid Interest | Other fees and expense | Policies pledged as collateral as determined by the lenders | Policies pledged as collateral excluding certain specified life insurance policies | Securities Pledged as Collateral | Floor Rate | Applicable Margin | Federal Funds Rate | White Eagle Asset Portfolio, LLC | White Eagle Asset Portfolio, LLC | White Eagle Asset Portfolio, LLC | ||||||||||
Contract | ||||||||||||||||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revolving credit facility effective date | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 29-Apr-13 | ' | ' |
Number of policies owned | 595 | ' | 595 | ' | 612 | ' | 452 | ' | ' | ' | ' | ' | ' | ' | ' | 452 | ' | ' | ' | ' | ' | ' |
Life insurance policies with aggregate death benefit | $2,888,289,000 | ' | $2,888,289,000 | ' | $2,954,890,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $2,300,000,000 | ' | ' | ' | ' | ' | ' |
Life insurance estimated fair value | 350,383,000 | ' | 350,383,000 | ' | 302,961,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 295,500,000 | ' | ' | ' | ' | ' | ' |
Revolving Credit facility, current borrowing capacity | ' | ' | ' | ' | ' | ' | ' | 159,100,000 | 159,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 300,000,000 |
Line of credit borrowing base percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | 100.00% | 100.00% | 75.00% | 50.00% | ' | ' | ' | ' | ' | ' | ' |
Line of credit facility, maximum borrowing capacity | ' | ' | ' | ' | ' | ' | ' | 143,400,000 | 143,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of credit facility, remaining borrowing capacity | ' | ' | ' | ' | ' | ' | ' | 2,600,000 | 2,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of remaining proceeds | ' | ' | ' | ' | ' | 100.00% | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50.00% | 50.00% | ' |
Proceeds to be paid to White Eagle after payment of loan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 76,100,000 | 76,100,000 | ' |
Collateral pledge percentage for distributions to be altered | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basis spread on variable rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.50% | 4.00% | 0.75% | ' | ' | ' |
Base rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt instrument effective rate | ' | ' | ' | ' | ' | ' | ' | 5.50% | 5.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest expense on the facility | 4,303,000 | 1,158,000 | 11,165,000 | 12,020,000 | ' | ' | ' | 2,100,000 | 5,800,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest expense withheld from borrowings by lender | ' | ' | 4,962,000 | 995,000 | ' | ' | ' | 1,500,000 | 4,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest paid | ' | ' | 4,496,000 | 825,000 | ' | ' | ' | 573,000 | 1,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Credit agreement expiration date | ' | ' | ' | ' | ' | 28-Apr-28 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revolving Credit facility debt, at estimated fair value | 142,661,000 | ' | 142,661,000 | ' | 123,847,000 | ' | ' | 142,661,000 | 142,661,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revolving Credit Facility debt, outstanding | ' | ' | ' | ' | ' | ' | ' | $156,600,000 | $156,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
850_Senior_Unsecured_Convertib
8.50% Senior Unsecured Convertible Notes - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||||||||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Feb. 28, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Jun. 05, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Feb. 28, 2014 | Jun. 05, 2014 | ||
8.50% Senior Unsecured Convertible Notes Due 2019 | 8.50% Senior Unsecured Convertible Notes Due 2019 | 8.50% Senior Unsecured Convertible Notes Due 2019 | 8.50% Senior Unsecured Convertible Notes Due 2019 | 8.50% Senior Unsecured Convertible Notes Due 2019 | 8.50% Senior Unsecured Convertible Notes Due 2019 | 8.50% Senior Unsecured Convertible Notes Due 2019 | 8.50% Senior Unsecured Convertible Notes Due 2019 | |||||||
D | Period One | Period Two | Bulldog Investors Llc | Reclassifications To Additional Paid In Capital | ||||||||||
Director | ||||||||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Debt instrument issued | ' | ' | ' | ' | ' | $70,700,000 | $70,700,000 | $70,700,000 | ' | ' | ' | $9,200,000 | ' | |
Debt instrument, interest rate | ' | ' | ' | ' | ' | 8.50% | 8.50% | 8.50% | ' | ' | ' | ' | ' | |
Debt instrument, due date | ' | ' | ' | ' | ' | ' | ' | '2019 | ' | ' | ' | ' | ' | |
Debt instrument, issuance date | ' | ' | ' | ' | ' | 21-Feb-14 | ' | ' | ' | ' | ' | ' | ' | |
Number of board of directors | ' | ' | ' | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | |
Debt instrument, maturity date | ' | ' | ' | ' | ' | ' | ' | 15-Feb-19 | ' | ' | ' | ' | ' | |
Debt instrument, frequency of periodic payment | ' | ' | ' | ' | ' | ' | ' | 'Semi-annually in arrears on August 15 and February 15 of each year | ' | ' | ' | ' | ' | |
Debt instrument, date of first required payment | ' | ' | ' | ' | ' | ' | ' | 15-Aug-14 | ' | ' | ' | ' | ' | |
Debt instrument, convertible, conversion rate | ' | ' | ' | ' | ' | 147.929 | ' | ' | ' | ' | ' | ' | ' | |
Debt Instrument, Convertible, Conversion Price | ' | ' | ' | ' | ' | $6.76 | ' | ' | ' | ' | ' | ' | ' | |
Debt instrument, redemption start date | ' | ' | ' | ' | ' | ' | ' | 15-Feb-17 | ' | ' | ' | ' | ' | |
Debt instrument, convertible, minimum percentage of common stock price | ' | ' | ' | ' | ' | 130.00% | ' | ' | ' | ' | ' | ' | ' | |
Debt instrument, convertible, threshold trading days | ' | ' | ' | ' | ' | 20 | ' | ' | ' | ' | ' | ' | ' | |
Debt instrument, convertible, threshold consecutive trading days | ' | ' | ' | ' | ' | '30 days | ' | ' | ' | ' | ' | ' | ' | |
Debt instrument, redemption price, percentage | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' | ' | |
Conversion derivative liability, at estimated fair value | ' | ' | ' | ' | ' | ' | ' | ' | 23,700,000 | ' | ' | ' | ' | |
Unamortized transaction costs | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 756,000 | |
Deferred tax asset, conversion derivative liability | 6,500,000 | ' | 6,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8,800,000 | |
Senior unsecured convertible notes, net of discount | 55,250,000 | ' | 55,250,000 | ' | 0 | [1] | ' | 55,300,000 | 55,300,000 | ' | ' | ' | ' | ' |
Unamortized debt discount | ' | ' | ' | ' | ' | ' | 15,500,000 | 15,500,000 | ' | ' | ' | ' | ' | |
Debt instrument origination cost | 2,295,000 | ' | 2,295,000 | ' | 0 | [1] | ' | 2,300,000 | 2,300,000 | ' | ' | ' | ' | ' |
Interest expense of notes | ' | ' | ' | ' | ' | ' | 2,200,000 | 5,300,000 | ' | ' | ' | ' | ' | |
Interest payable | 768,000 | ' | 768,000 | ' | 0 | [1] | ' | ' | ' | ' | 1,500,000 | 3,700,000 | ' | ' |
Amortizing debt discounts | ' | ' | ' | ' | ' | ' | 605,000 | 1,400,000 | ' | ' | ' | ' | ' | |
Debt issuance cost | ' | ' | 0 | 10,340,000 | ' | ' | 90,000 | 239,000 | ' | ' | ' | ' | ' | |
Change in fair value of conversion derivative liability | $0 | $0 | ($6,759,000) | $0 | ' | ' | ' | ($6,800,000) | ' | ' | ' | ' | ' | |
[1] | Derived from audited consolidated financial statements. |
Fair_Value_of_Conversion_Deriv
Fair Value of Conversion Derivative Liability (Detail) (8.50% Senior Unsecured Convertible Notes Due 2019, Conversion derivative liability) | 0 Months Ended |
Jun. 05, 2014 | |
8.50% Senior Unsecured Convertible Notes Due 2019 | Conversion derivative liability | ' |
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | ' |
Expected Volatility | 40.00% |
Expected Term in Years | '4 years 8 months 12 days |
Risk Free Rate | 1.50% |
Assets_And_Liabilities_Measure
Assets And Liabilities Measured at Fair Value on Recurring Basis (Detail) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | |
In Thousands, unless otherwise specified | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | |
Fair value of life insurance policies held | $350,383 | $302,961 | |
Structured settlement receivables | 383 | 660 | [1] |
Assets, Fair Value Disclosure, Total | 350,766 | 303,621 | |
Revolving Credit Facility debt | 142,661 | 123,847 | |
Financial and Nonfinancial Liabilities, Fair Value Disclosure | 142,661 | 123,847 | |
Fair Value, Inputs, Level 3 | ' | ' | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | |
Fair value of life insurance policies held | 350,383 | 302,961 | |
Structured settlement receivables | 383 | 660 | |
Assets, Fair Value Disclosure, Total | 350,766 | 303,621 | |
Revolving Credit Facility debt | 142,661 | 123,847 | |
Financial and Nonfinancial Liabilities, Fair Value Disclosure | $142,661 | $123,847 | |
[1] | Derived from audited consolidated financial statements. |
Quantitative_Information_about
Quantitative Information about Level 3 Fair Value Measurements (Detail) (USD $) | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Dec. 31, 2013 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ||
Investment in life settlements | $350,383 | $302,961 | ||
Structured settlements receivables | 383 | 660 | [1] | |
Investment in life settlements | 2,888,289 | 2,954,890 | ||
Revolving Credit Facility debt | 142,661 | 123,847 | ||
Weighted average discount rate | 18.56% | ' | ||
Structured settlements | ' | ' | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ||
Structured settlements receivables | 383 | ' | ||
Weighted average discount rate | 8.66% | ' | ||
Revolving Credit Facility | ' | ' | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ||
Revolving Credit Facility debt | 142,661 | ' | ||
Discount rate | 24.01% | ' | ||
Fair Value, Inputs, Level 3 | ' | ' | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ||
Investment in life settlements | 350,383 | 302,961 | ||
Structured settlements receivables | 383 | 660 | ||
Investment in life settlements | 2,888,289 | ' | ||
Revolving Credit Facility debt | 142,661 | 123,847 | ||
Fair Value, Inputs, Level 3 | Non Premium Financed | ' | ' | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ||
Investment in life settlements | 52,909 | ' | ||
Investment in life settlements | 220,802 | ' | ||
Fair Value, Inputs, Level 3 | Premium Financed | ' | ' | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ||
Investment in life settlements | 297,474 | ' | ||
Investment in life settlements | $2,667,487 | ' | ||
Fair Value, Inputs, Level 3 | Life Finance | ' | ' | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ||
Valuation Technique | 'Discounted cash flow | ' | ||
Weighted average life expectancy valuation period | '11 years | ' | ||
Weighted average discount rate | 18.56% | ' | ||
Fair Value, Inputs, Level 3 | Life Finance | Non Premium Financed | ' | ' | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ||
Valuation Technique | 'Discounted cash flow | ' | ||
Weighted average life expectancy valuation period | '8 years 1 month 6 days | ' | ||
Fair Value, Inputs, Level 3 | Life Finance | Premium Financed | ' | ' | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ||
Valuation Technique | 'Discounted cash flow | ' | ||
Weighted average life expectancy valuation period | '11 years 2 months 12 days | ' | ||
Fair Value, Inputs, Level 3 | Structured settlements | ' | ' | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ||
Valuation Technique | 'Discounted cash flow | ' | ||
Weighted average discount rate | 8.66% | ' | ||
Fair Value, Inputs, Level 3 | Revolving Credit Facility | ' | ' | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ||
Valuation Technique | 'Discounted cash flow | ' | ||
Weighted average life expectancy valuation period | '10 years 6 months | ' | ||
Weighted average discount rate | 24.01% | [2] | ' | |
Fair Value, Inputs, Level 3 | Minimum | Life Finance | Non Premium Financed | ' | ' | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ||
Discount rate | 14.80% | ' | ||
Fair Value, Inputs, Level 3 | Minimum | Life Finance | Premium Financed | ' | ' | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ||
Discount rate | 16.55% | ' | ||
Fair Value, Inputs, Level 3 | Maximum | Life Finance | Non Premium Financed | ' | ' | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ||
Discount rate | 20.80% | ' | ||
Fair Value, Inputs, Level 3 | Maximum | Life Finance | Premium Financed | ' | ' | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ||
Discount rate | 26.55% | ' | ||
[1] | Derived from audited consolidated financial statements. | |||
[2] | Actual |
Fair_Value_Measurements_Additi
Fair Value Measurements - Additional Information (Detail) (USD $) | 9 Months Ended | 9 Months Ended | 9 Months Ended | 9 Months Ended | 9 Months Ended | 0 Months Ended | 1 Months Ended | 9 Months Ended | 0 Months Ended | 1 Months Ended | |||||||||
Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Mar. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | 16-May-14 | Apr. 29, 2013 | Sep. 30, 2014 | 16-May-14 | Apr. 29, 2013 | ||
Contract | Contract | Structured settlements | Previously Premium Financed | Previously Premium Financed | Previously Premium Financed | Non-Premium Financed | Non-Premium Financed | Non-Premium Financed | 21st Services | Noninvestment grade | Impaired life bearing | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | |||
Contract | Contract | Minimum | Maximum | Contract | Minimum | Maximum | Contract | Securities | White Eagle Asset Portfolio, LLC | White Eagle Asset Portfolio, LLC | |||||||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Mortality rate | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | 200.00% | ' | ' | ' | ' | ' | |
Life expectancy, percentage | 15.80% | ' | ' | ' | ' | ' | ' | ' | ' | ' | 19.00% | ' | ' | ' | ' | ' | ' | ' | |
Number of life insurance policies | 595 | 612 | ' | 17 | 550 | ' | ' | 45 | ' | ' | ' | 19 | ' | ' | 452 | ' | ' | ' | |
Additional basis point risk premium | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3.00% | ' | ' | ' | ' | ' | ' | |
Life insurance estimated fair value | $350,383,000 | $302,961,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Discount rates | ' | ' | ' | ' | ' | 16.55% | 26.55% | ' | 14.80% | 20.80% | ' | ' | ' | ' | ' | 24.01% | ' | ' | |
Weighted average discount rate | 18.56% | ' | ' | 8.66% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Settlements with estimated fair value | 383,000 | 660,000 | [1] | ' | 383,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of remaining proceeds | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | 100.00% | ' | 50.00% | 50.00% | |
Proceeds to be paid to White Eagle after payment of loan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 76,100,000 | 76,100,000 | |
Revolving Credit facility debt, at estimated fair value | 142,661,000 | 123,847,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 142,661,000 | ' | ' | |
Revolving Credit Facility debt, outstanding | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $156,600,000 | ' | ' | |
[1] | Derived from audited consolidated financial statements. |
Changes_in_Life_Expectancy_Use
Changes in Life Expectancy Used to Estimate Fair Value (Detail) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' | ' |
Value | $350,383 | ' | $350,383 | ' | $302,961 |
Change in Value | 0 | -461 | -426 | -1,708 | ' |
+6 Life Expectancy Months Adjustment | ' | ' | ' | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' | ' |
Value | 294,789 | ' | 294,789 | ' | ' |
Change in Value | ' | ' | -55,594 | ' | ' |
-6 Life Expectancy Months Adjustment | ' | ' | ' | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' | ' |
Value | 411,117 | ' | 411,117 | ' | ' |
Change in Value | ' | ' | $60,734 | ' | ' |
Life_Insurance_Issuer_concentr
Life Insurance Issuer concentrations (Detail) | 9 Months Ended |
Sep. 30, 2014 | |
10% of total fair value of our investments in life settlements | Transamerica Occidental Life Insurance Company | Moody's, A1 Rating | Standard & Poor's, AA- Rating | ' |
Concentration Risk [Line Items] | ' |
Concentrations risk percentage | 24.10% |
10% of total fair value of our investments in life settlements | Lincoln National Life Insurance Company | Moody's, A1 Rating | Standard & Poor's, AA- Rating | ' |
Concentration Risk [Line Items] | ' |
Concentrations risk percentage | 22.50% |
10% of total fair value of our investments in life settlements | Lincoln Benefit Life Company | Moodys Credit Rating, NR | Standard & Poor's, BBB+ Rating | ' |
Concentration Risk [Line Items] | ' |
Concentrations risk percentage | 10.70% |
Life insurance issuer concentrations that exceed 10% of total death benefit | Transamerica Occidental Life Insurance Company | Moody's, A1 Rating | Standard & Poor's, AA- Rating | ' |
Concentration Risk [Line Items] | ' |
Concentrations risk percentage | 20.60% |
Life insurance issuer concentrations that exceed 10% of total death benefit | Lincoln National Life Insurance Company | Moody's, A1 Rating | Standard & Poor's, AA- Rating | ' |
Concentration Risk [Line Items] | ' |
Concentrations risk percentage | 20.30% |
Life insurance issuer concentrations that exceed 10% of total death benefit | Lincoln Benefit Life Company | Moodys Credit Rating, NR | Standard & Poor's, BBB+ Rating | ' |
Concentration Risk [Line Items] | ' |
Concentrations risk percentage | 10.00% |
Changes_in_Weighted_Average_Di
Changes in Weighted Average Discount Rate Used to Estimate Fair Value (Detail) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' | ' |
Weighted Average Rate | ' | ' | 18.56% | ' | ' |
Value | $350,383 | ' | $350,383 | ' | $302,961 |
Change in Value | 0 | -461 | -426 | -1,708 | ' |
.50% Decrease in Discount Rate | ' | ' | ' | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' | ' |
Weighted Average Rate | ' | ' | 18.06% | ' | ' |
Value | 360,030 | ' | 360,030 | ' | ' |
Change in Value | ' | ' | 9,647 | ' | ' |
.50% Increase in Discount Rate | ' | ' | ' | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' | ' |
Weighted Average Rate | ' | ' | 19.06% | ' | ' |
Value | 341,171 | ' | 341,171 | ' | ' |
Change in Value | ' | ' | ($9,212) | ' | ' |
Changes_in_Life_Expectancy_Use1
Changes in Life Expectancy Used to Estimate Fair Value of Revolving Credit Facility (Detail) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 |
In Thousands, unless otherwise specified | Revolving Credit Facility | +6 Life Expectancy Months Adjustment | -6 Life Expectancy Months Adjustment | ||
Revolving Credit Facility | Revolving Credit Facility | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' | ' |
Value | $142,661 | $123,847 | $142,661 | $121,547 | $165,172 |
Change in Value | ' | ' | ' | ($21,114) | $22,511 |
Changes_in_Weighted_Average_Di1
Changes in Weighted Average Discount Rate Used to Estimate Fair Value of Revolving Credit Facility (Detail) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 |
In Thousands, unless otherwise specified | Revolving Credit Facility | .50% Decrease in Discount Rate | .50% Increase in Discount Rate | ||
Revolving Credit Facility | Revolving Credit Facility | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' | ' |
Discount rate | ' | ' | 24.01% | 23.51% | 24.51% |
Value | $142,661 | $123,847 | $142,661 | $145,394 | $140,020 |
Change in Value | ' | ' | ' | $2,733 | ($2,641) |
Changes_in_Fair_Value_for_All_
Changes in Fair Value for All Assets and Liabilities Using Material Level of Unobservable (Level 3) Inputs (Detail) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Life Finance | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Beginning Balance | $302,961 | $113,441 |
Purchase of policies | 3,488 | 55,500 |
Acquired in foreclosure | ' | 3,168 |
Change in fair value | 19,313 | 81,948 |
Matured/sold policies | ' | -12,658 |
Matured/lapsed/sold policies | -15,957 | ' |
Premiums paid | 40,578 | 50,984 |
Transfers into level 3 | ' | ' |
Transfer out of level 3 | ' | ' |
Ending Balance | 350,383 | 292,383 |
Changes in fair value included in earnings for the period relating to assets held | 8,627 | 74,655 |
Revolving Credit Facility | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Beginning balance | 123,847 | ' |
Initial advance under the revolving credit facility | ' | 83,020 |
Subsequent Draws under the revolving credit facility | 40,965 | 37,059 |
Payments on credit facility | -17,595 | ' |
Change in fair value | -4,556 | -5,295 |
Transfers into level 3 | ' | ' |
Transfer out of level 3 | ' | ' |
Ending balance | 142,661 | 114,784 |
Conversion derivative liability | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Beginning balance | 16,901 | ' |
Change in fair value | 6,759 | ' |
Reclassified to equity | -23,660 | ' |
Transfers into level 3 | ' | ' |
Transfer out of level 3 | ' | ' |
Ending balance | $0 | ' |
Commitments_and_Contingencies_
Commitments and Contingencies - Additional Information (Detail) (USD $) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 0 Months Ended | ||||||
Apr. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Feb. 11, 2011 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Apr. 18, 2013 | Jul. 29, 2013 | |
Contract | Contract | Class Action | Pending Litigation | Pending Litigation | Pending Litigation | Pending Litigation | Pending Litigation | Pending Litigation | |||||
Contract | Minimum | ||||||||||||
Commitments and Contingencies [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of annual increase of base rent | ' | ' | ' | 3.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Annual base rent | ' | ' | ' | $225,100 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Lease expiration date | ' | ' | ' | 30-Sep-20 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Rent expense under operating lease | ' | 126,000 | 126,000 | 377,000 | 377,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Operating leases, remainder of year ended December 31, 2014 | ' | 49,000 | ' | 49,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Indemnification expenses | ' | 500,000 | 880,000 | 1,500,000 | 2,300,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Number of policies | ' | 39 | ' | 39 | ' | ' | ' | ' | ' | ' | ' | 29 | ' |
US Government ongoing investigation for criminal conduct | ' | 8,000,000 | ' | 8,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Non-Prosecution Agreement terms description | ' | ' | ' | 'The Non-Prosecution Agreement has a term of three years until April 30, 2015, but the Company may petition the USAO to forego the remaining term of the Non-Prosecution Agreement, if the Company otherwise complies with all of its obligations under the Non-Prosecution Agreement. | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Non-Prosecution Agreement terms | ' | ' | ' | '3 years | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Litigation-related fees | ' | ' | ' | ' | ' | ' | ' | 1,200,000 | 1,600,000 | 3,200,000 | 4,600,000 | ' | ' |
Payments for class action settlements | ' | ' | ' | ' | ' | ' | 12,000,000 | ' | ' | ' | ' | ' | ' |
Insurance recoverable from the Company's D&O Carrier | ' | ' | ' | ' | ' | ' | 11,000,000 | ' | ' | ' | ' | ' | ' |
Expected issuance of warrants for shares | 2,000,000 | ' | ' | ' | ' | ' | 2,000,000 | ' | ' | ' | ' | ' | ' |
Common stock warrants term | ' | ' | ' | '5 years | ' | ' | '5 years | ' | ' | ' | ' | ' | ' |
Exercise price of warrants | ' | 10.75 | ' | 10.75 | ' | 14.51 | 10.75 | ' | ' | ' | ' | ' | ' |
Compensatory damages sought in addition to an award of punitive damages | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 30,000,000 |
Litigation expense sanctioned by court on subsidiary Imperial Premium Finance (IPF) | ' | ' | ' | $850,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stockholders_Equity_Additional
Stockholders' Equity - Additional Information (Detail) (USD $) | 1 Months Ended | 9 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 0 Months Ended | 9 Months Ended | 0 Months Ended | 12 Months Ended | 9 Months Ended | ||||||
Apr. 30, 2014 | Sep. 30, 2014 | Dec. 31, 2013 | Feb. 11, 2011 | Sep. 30, 2014 | Sep. 30, 2014 | Mar. 31, 2014 | Sep. 30, 2014 | Dec. 31, 2011 | Sep. 30, 2014 | Feb. 11, 2011 | Sep. 30, 2014 | Apr. 01, 2013 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | |
ASU No. 2013-11 | Minimum | Derivative Actions | Performance Shares | Omnibus Plan | Omnibus Plan | Omnibus Plan | Omnibus Plan | Omnibus Plan | Omnibus Plan | Omnibus Plan | Omnibus Plan | Omnibus Plan | |||||
Common Stock | Restricted Stock | Restricted Stock | Unrestricted Stock | Unrestricted Stock | Performance Shares | Performance Shares | Performance Shares | ||||||||||
Minimum | Maximum | ||||||||||||||||
Stockholders Equity [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shares of common stock reserved for future grant | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,200,000 | ' | ' | ' | ' | ' | ' | ' |
Options Outstanding | ' | 815,448 | 831,282 | ' | ' | ' | ' | ' | ' | 815,448 | ' | ' | ' | ' | ' | ' | ' |
Stock granted | ' | 41,060 | ' | ' | ' | ' | ' | 299,500 | ' | ' | 61,853 | 41,060 | 13,759 | 13,759 | 299,500 | ' | ' |
Increase in additional paid-in-capital due to reclassification of embedded derivative | ' | $14,069,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock issued for legal settlement | ' | ' | ' | ' | ' | ' | 125,628 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expected issuance of warrants for shares | 2,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated Fair Value Of Warrants | ' | 5,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock warrants term | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Exercise price of warrants | ' | 10.75 | ' | 14.51 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Average daily trading closing price | ' | ' | ' | ' | ' | $8.50 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Average daily trading closing price, period | ' | ' | ' | ' | ' | '45 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock granted, subject to shareholders' approval of an amendment and restatement | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 150,000 | ' | ' |
Actual shares to be issued | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.00% | 150.00% |
Stock vesting period | ' | ' | ' | ' | ' | ' | ' | ' | '3 years | ' | ' | '1 year | ' | ' | '1 year | ' | ' |
Securities remaining for future issuance | ' | ' | ' | ' | ' | ' | ' | ' | ' | 308,940 | ' | ' | ' | ' | ' | ' | ' |
Increase to additional paid-in-capital | ' | ' | ' | ' | $6,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | 9 Months Ended | ||||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Jun. 05, 2014 | Jun. 05, 2014 | Sep. 30, 2014 | |
8.50% Senior Unsecured Convertible Notes Due 2019 | 8.50% Senior Unsecured Convertible Notes Due 2019 | ASU No. 2013-11 | |||||
Reclassifications To Additional Paid In Capital | |||||||
Income Taxes [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Annual effective tax rate | ' | ' | 36.90% | ' | ' | ' | ' |
Effective income tax rate reconciliation, prior year income taxes, percent | ' | ' | 0.00% | ' | ' | ' | ' |
Effective tax rate, valuation allowance for deferred tax assets | ' | ' | 0.00% | ' | ' | ' | ' |
Provision for income taxes | ($2,235,000) | $0 | ($2,452,000) | $40,000 | ' | ' | $3,700,000 |
Increase to additional paid-in-capital | ' | ' | ' | ' | ' | ' | 6,300,000 |
Deferred tax asset, conversion derivative liability | 6,500,000 | ' | 6,500,000 | ' | ' | 8,800,000 | ' |
Deferred tax liability | $6,500,000 | ' | $6,500,000 | ' | $6,200,000 | ' | ' |
Subsequent_Events_Additional_I
Subsequent Events - Additional Information (Detail) (USD $) | 9 Months Ended | 0 Months Ended | 0 Months Ended | 0 Months Ended | |||||||||||||
Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Nov. 10, 2014 | Nov. 10, 2014 | Nov. 10, 2014 | Nov. 10, 2014 | Nov. 10, 2014 | Nov. 10, 2014 | Nov. 10, 2014 | Nov. 10, 2014 | Nov. 10, 2014 | Nov. 10, 2014 | Nov. 10, 2014 | Nov. 10, 2014 | Nov. 10, 2014 | ||
Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | |||||
Secured Debt | Secured Debt | Secured Debt | Secured Debt | Secured Debt | Secured Debt | Secured Debt | Secured Debt | Secured Debt | Secured Debt | Secured Debt | Secured Debt | Secured Debt | |||||
Debt Instrument, Redemption, Period One | Debt Instrument, Redemption, Period Two | Extended Term | Extended Term | May be issued if the Company deploy $25 million in investments following the Initial Closing Date | May be issued if the Company satisfies certain book and market value targets | Maximum | Maximum | Debt Covenant | Indaba Capital Management, L.P. | Indaba Capital Management, L.P. | |||||||
May be issued during the period ending on the 12-month anniversary of the Initial Closing Date | Director | ||||||||||||||||
Subsequent Event [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Debt instrument, face amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | $25,000,000 | $50,000,000 | $100,000,000 | $75,000,000 | ' | ' | $25,000,000 | |
Secured notes issuance price as percentage of face amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 96.00% | |
Number of directors that might be appointed in the board | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | |
Percentage of voting interest that might be acquired by the appointed director | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5.00% | ' | |
Debt instrument, interest rate | ' | ' | ' | ' | 12.88% | ' | ' | ' | 14.50% | ' | ' | ' | ' | ' | ' | ' | |
Debt instrument, maturity term | ' | ' | ' | '36 months | ' | ' | ' | '12 months | ' | ' | ' | ' | ' | ' | ' | ' | |
Debt instrument fee as a percentage of outstanding principal amount | ' | ' | ' | ' | ' | ' | ' | ' | 3.50% | ' | ' | ' | ' | ' | ' | ' | |
Debt instrument, redemption description | ' | ' | ' | 'The Secured Notes may not be optionally redeemed by Imperial for one year from the Initial Closing Date. | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Debt instrument, early redemption period | ' | ' | ' | '1 year | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Percentage of principal amount of debt redemption | ' | ' | ' | ' | ' | 106.00% | 104.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Debt instrument, redemption notice period | ' | ' | ' | '60 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Minimum net worth | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100,000,000 | ' | ' | |
Cash and cash equivalents | 53,745,000 | ' | 14,722,000 | [1] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20,000,000 | ' | ' |
Percentage of first tier foreign subsidiaries equity interests pledge to secure debt | ' | ' | ' | 65.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Debt instrument, increments | ' | ' | ' | 25,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Debt issue fees and expenses | $0 | $10,340,000 | ' | $1,900,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Debt instrument, draw down fee percentage | ' | ' | ' | 1.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Debt instrument, percentage of monthly unused fee on unissued notes | ' | ' | ' | ' | 1.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
[1] | Derived from audited consolidated financial statements. |