Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2015 | Nov. 09, 2015 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | Emergent Capital, Inc.. | |
Entity Central Index Key | 1,494,448 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Trading Symbol | IFT | |
Entity Common Stock, Shares Outstanding | 28,130,508 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 | ||
Assets | ||||
Cash and cash equivalents | $ 31,260 | $ 51,166 | [1] | |
Prepaid expenses and other assets | 1,527 | 1,502 | [1] | |
Deposits - other | 1,347 | 1,340 | [1] | |
Deposits on purchases of life settlements | 0 | 1,630 | [1] | |
Structured settlement receivables, at estimated fair value | 0 | 384 | [1] | |
Structured settlement receivables at cost, net | 0 | 597 | [1] | |
Life settlements, at estimated fair value | 13,023 | 82,575 | [1] | |
Fixed assets, net | 335 | 355 | [1] | |
Investment in affiliates | [1] | 2,384 | 2,384 | |
Deferred debt costs, net | 1,907 | 3,936 | [1] | |
Total assets | 515,815 | 459,931 | [1] | |
Liabilities | ||||
Accounts payable and accrued expenses | 4,817 | 6,140 | [1] | |
Other liabilities | 419 | 1,256 | [1] | |
Convertible Notes, net of discount (Note 11) | 57,867 | 55,881 | [1] | |
Secured Notes, net of discount (Note 12) | 0 | 24,036 | [1] | |
White Eagle Revolving Credit Facility, at estimated fair value (VIE Note 4) | 145,831 | |||
Total liabilities | $ 279,414 | $ 244,828 | [1] | |
Commitments and Contingencies (Note 15) | [1] | |||
Stockholders’ Equity | ||||
Common stock (par value $0.01 per share, 80,000,000 authorized; 28,130,508 and 21,402,990 issued and outstanding as of September 30, 2015 and December 31, 2014, respectively) | $ 281 | $ 214 | [1] | |
Preferred stock (par value $0.01 per share, 40,000,000 authorized; 0 issued and outstanding as of September 30, 2015 and December 31, 2014) | 0 | 0 | [1] | |
Treasury Stock, net of cost (65,621 and 0 shares as of September 30, 2015 and December 31, 2014, respectively) | (348) | 0 | [1] | |
Additional paid-in-capital | 305,389 | 266,705 | [1] | |
Accumulated deficit | (68,921) | (51,816) | [1] | |
Total stockholders’ equity | 236,401 | 215,103 | [1] | |
Total liabilities and stockholders’ equity | 515,815 | 459,931 | [1] | |
Primary Beneficiary Variable Interest Entity | ||||
Assets | ||||
Cash and cash equivalents | 9,157 | 3,751 | [1] | |
Life settlements, at estimated fair value | 444,787 | 306,311 | [1] | |
Receivable for maturity of life settlements (VIE Note 4) | 10,088 | 4,000 | [1] | |
Liabilities | ||||
Accounts payable and accrued expenses | 388 | 423 | [1] | |
White Eagle Revolving Credit Facility, at estimated fair value (VIE Note 4) | 157,946 | 145,831 | [1] | |
8.50% Senior Unsecured Convertible Notes Due 2019 | ||||
Assets | ||||
Deferred debt costs, net | 1,900 | |||
Liabilities | ||||
Interest payable | 768 | 2,272 | [1] | |
Convertible Notes, net of discount (Note 11) | 57,900 | |||
12.875% Senior Secured Notes Due 2017 | ||||
Liabilities | ||||
Interest payable | 0 | 261 | [1] | |
Revolving Credit Facility | ||||
Liabilities | ||||
White Eagle Revolving Credit Facility, at estimated fair value (VIE Note 4) | 55,685 | 0 | [1] | |
Red Falcon Revolving Credit Facility, at estimated fair value (VIE Note 4) | $ 1,524 | $ 8,728 | [1] | |
[1] | Derived from audited consolidated financial statements. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2015 | Dec. 31, 2014 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 80,000,000 | 80,000,000 |
Common stock, shares issued (shares) | 28,130,508 | 21,402,990 |
Common stock, shares outstanding (shares) | 28,130,508 | 21,402,990 |
Preferred stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 40,000,000 | 40,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Treasury Stock | 65,621 | 0 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Income | ||||
Interest income | $ 7 | $ 9 | $ 16 | $ 22 |
Loss on life settlements, net | 0 | 0 | 0 | (426) |
Change in fair value of life settlements (Notes 8 & 13) | 2,667 | (3,643) | 43,582 | 19,313 |
Other income | 95 | 17 | 185 | 72 |
Total income (loss) | 2,769 | (3,617) | 43,783 | 18,981 |
Expenses | ||||
Interest expense | 8,614 | 4,303 | 21,491 | 11,165 |
Extinguishment of Secured Notes | 8,782 | 0 | 8,782 | 0 |
Change in fair value of Revolving Credit Facilities (Notes 9, 10 & 13) | (4,203) | (8,375) | 13,489 | (4,556) |
Change in fair value of conversion derivative liability (Notes 11 & 13) | 0 | 0 | 0 | 6,759 |
Personnel costs | 1,945 | 1,910 | 5,425 | 6,627 |
Legal fees | 3,370 | 2,943 | 10,345 | 9,121 |
Professional fees | 1,579 | 1,143 | 5,284 | 3,562 |
Insurance | 309 | 414 | 966 | 1,253 |
Other selling, general and administrative expenses | 585 | 544 | 1,671 | 1,365 |
Total expenses | 20,981 | 2,882 | 67,453 | 35,296 |
Income (loss) from continuing operations before income taxes | (18,212) | (6,499) | (23,670) | (16,315) |
Benefit for income taxes | 4,721 | 2,235 | 6,981 | 2,452 |
Net income (loss) from continuing operations | (13,491) | (4,264) | (16,689) | (13,863) |
Discontinued Operations: | ||||
Income (loss) from discontinued operations | (147) | (249) | (640) | (454) |
Benefit for income taxes | 34 | 0 | 224 | 0 |
Net income (loss) from discontinued operations | (113) | (249) | (416) | (454) |
Net income (loss) | $ (13,604) | $ (4,513) | $ (17,105) | $ (14,317) |
Basic and diluted income (loss) per share: | ||||
Continuing operations (usd per share) | $ (0.48) | $ (0.20) | $ (0.70) | $ (0.65) |
Discontinued operations (usd per share) | 0 | (0.01) | (0.02) | (0.02) |
Basic and diluted income (loss) per share available to common shareholders (usd per share) | $ (0.48) | $ (0.21) | $ (0.72) | $ (0.67) |
Weighted average shares outstanding: | ||||
Basic and Diluted (shares) | 28,084,254 | 21,361,930 | 23,827,030 | 21,352,086 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - 9 months ended Sep. 30, 2015 - USD ($) $ in Thousands | Total | Common Stock | Treasury Stock | Additional Paid-in Capital | (Accumulated Deficit) | |
Beginning Balance (in shares) at Dec. 31, 2014 | 21,402,990 | 0 | ||||
Beginning Balance at Dec. 31, 2014 | $ 215,103 | [1] | $ 214 | $ 0 | $ 266,705 | $ (51,816) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | (17,105) | (17,105) | ||||
Stock-based compensation (in shares) | 41,259 | |||||
Stock-based compensation | 429 | 429 | ||||
Purchase of treasury stock, net of costs (shares) | 65,621,000 | |||||
Purchase of treasury stock, net of costs | (348) | $ (348) | ||||
Common stock issued for rights offering, net of costs (in shares) | 6,688,433 | |||||
Common stock issued for rights offering, net of costs | 38,334 | $ 67 | 38,267 | |||
Retirement of common stock (shares) | (2,174) | |||||
Retirement of common stock | (12) | (12) | ||||
Ending Balance (in shares) at Sep. 30, 2015 | 28,130,508 | 65,621,000 | ||||
Ending Balance at Sep. 30, 2015 | $ 236,401 | $ 281 | $ (348) | $ 305,389 | $ (68,921) | |
[1] | Derived from audited consolidated financial statements. |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Cash flows from operating activities | ||
Net income (loss) | $ (17,105) | $ (14,317) |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||
Depreciation and amortization | 74 | 59 |
Stock-based compensation expense | 429 | 762 |
Change in fair value of life settlements | (43,582) | (19,313) |
Unrealized change in fair value of structured settlements | (20) | (24) |
Loss on sale of structured settlements | (32) | 0 |
Change in fair value of Revolving Credit Facilities | 13,489 | (4,556) |
Loss on sale of structured settlements | 0 | 426 |
Interest income | (81) | (102) |
Extinguishment of Secured Notes | 8,782 | 0 |
Change in fair value of conversion derivative liability | 0 | 6,759 |
Deferred income tax | (7,205) | (2,452) |
Change in assets and liabilities: | ||
Restricted cash | 0 | 13,506 |
Deposits - other | (654) | 243 |
Investment in affiliates | 0 | (7) |
Structured settlement receivables | 1,097 | 578 |
Prepaid expenses and other assets | (188) | (413) |
Accounts payable and accrued expenses | (1,491) | 2,512 |
Other liabilities | (812) | (14,301) |
Net cash used in operating activities | (37,401) | (23,986) |
Cash flows from investing activities | ||
Purchase of fixed assets, net of disposals | (47) | (178) |
Purchase of life settlements | (28,904) | (3,488) |
Premiums paid on life settlements | (48,243) | (40,578) |
Proceeds from sale of life settlements, net | 0 | 4,031 |
Proceeds from maturity of life settlements | 47,519 | 13,641 |
Deposits on purchase of life settlements | 0 | (50) |
Net cash used in investing activities | (29,675) | (26,622) |
Cash flows from financing activities | ||
Proceeds from rights offering | 38,458 | 0 |
Proceeds from Secured Notes, net | 23,750 | 0 |
Purchase of treasury stock | (348) | 0 |
Payment under finance lease obligations | (25) | 0 |
Net cash provided by financing activities | 52,576 | 86,301 |
Net decrease/increase in cash and cash equivalents | (14,500) | 35,693 |
Cash and cash equivalents, at beginning of the period | 54,917 | 22,699 |
Cash and cash equivalents, at end of the period | 40,417 | 58,392 |
Supplemental disclosures of cash flow information: | ||
Cash paid for interest during the period | 12,143 | 4,496 |
Supplemental disclosures of non-cash financing activities: | ||
Interest payment and fees withheld from borrowings by lender | 5,566 | 4,962 |
Senior Unsecured Notes | ||
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||
Amortization of discount and deferred cost for notes | 2,281 | 1,648 |
Change in fair value of conversion derivative liability | 6,800 | |
Change in assets and liabilities: | ||
Interest Payable | (1,503) | 768 |
Cash flows from financing activities | ||
Proceeds from Convertible Notes, net | 0 | 67,892 |
Extinguishment of Secured Notes | (3,570) | 0 |
Senior Secured Notes | ||
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||
Amortization of discount and deferred cost for notes | 542 | 0 |
Change in assets and liabilities: | ||
Interest Payable | (261) | 0 |
Cash flows from financing activities | ||
Secured Notes deferred costs | (5) | 0 |
Revolving Credit Facility | ||
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||
White Eagle Revolving Credit Facility financing cost and fees | 5,566 | 4,238 |
Cash flows from financing activities | ||
Borrowings from revolving credit facility | 36,880 | 36,004 |
Repayment of borrowings under revolving credit facility | (43,241) | (17,595) |
Red Falcon Trust | ||
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||
Red Falcon Revolving Credit Facility origination cost | 3,273 | 0 |
Red Falcon Trust | Revolving Credit Facility | ||
Cash flows from financing activities | ||
Borrowings from revolving credit facility | 2,967 | 0 |
Repayment of borrowings under revolving credit facility | (1,863) | 0 |
Red Falcon Revolving Credit Facility origination costs | (427) | 0 |
Lender | Red Falcon Trust | Revolving Credit Facility | ||
Cash flows from financing activities | ||
Borrowings from revolving credit facility | 54,000 | 0 |
Repayment of borrowings under revolving credit facility | (51,800) | 0 |
Supplemental disclosures of non-cash financing activities: | ||
Red Falcon Revolving Credit Facility origination cost paid to lender | $ 2,200 | $ 0 |
Description of Business
Description of Business | 9 Months Ended |
Sep. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | Description of Business Founded in December 2006 as a Florida limited liability company, Imperial Holdings, LLC, converted into Imperial Holdings, Inc. on February 3, 2011, in connection with the Company’s initial public offering. Effective September 1, 2015, the Company changed its name to Emergent Capital, Inc. (with its subsidiary companies, the “Company” or “Emergent Capital”). Incorporated in Florida, Emergent Capital, through its subsidiary companies, owns a portfolio of 634 life insurance policies, also referred to as life settlements, with a fair value of $457.8 million and an aggregate death benefit of approximately $3.0 billion at September 30, 2015 . The Company primarily earns income on these policies from changes in their fair value and through death benefits. 439 of these policies, with an aggregate death benefit of approximately $2.2 billion and an estimated fair value of approximately $327.4 million at September 30, 2015 are pledged under a $300.0 million , revolving credit agreement (the “White Eagle Revolving Credit Facility”) entered into by the Company’s indirect subsidiary, White Eagle Asset Portfolio, LP (“White Eagle”). Additionally, 157 policies, with an aggregate death benefit of approximately $604.8 million and an estimated fair value of approximately $117.4 million at September 30, 2015 were pledged as collateral under a $110.0 million , revolving credit agreement (the “Red Falcon Revolving Credit Facility” and, together with the White Eagle Revolving Credit Facility, the "Revolving Credit Facilities") entered into by Red Falcon Trust (“Red Falcon”), a Delaware statutory trust formed by a wholly-owned Irish subsidiary of the Company. |
Principles of Consolidation and
Principles of Consolidation and Basis of Presentation | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Principles of Consolidation and Basis of Presentation | 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 which is accounted for using the cost method of accounting. 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 subsidiary companies in connection with the Revolving Credit Facilities. Notwithstanding consolidation, as referenced above, White Eagle is the owner of 439 policies, with an aggregate death benefit of approximately $2.2 billion and an estimated fair value of approximately $327.4 million and Red Falcon is the owner of 157 policies with an aggregate death benefit of approximately $604.8 million and an estimated fair value of approximately $117.4 million , in each case, at September 30, 2015 . 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, 2015 are not necessarily indicative of the results that may be expected for future periods or for the year ended December 31, 2015 . These interim financial statements should be read in conjunction with the Consolidated Financial Statements and Notes thereto included in Emergent Capital's Annual Report on Form 10-K for the fiscal year ended December 31, 2014 . Discontinued Operations On October 25, 2013, the Company sold substantially all of the assets comprising its structured settlement business for $12.0 million . As a result, the Company has discontinued segment reporting and classified its operating results of the structured settlement business as discontinued operations. The accompanying consolidated balance sheets of the Company as of September 30, 2015 and December 31, 2014 , and the related consolidated statements of operations for each of the three months and nine months ended September 30, 2015 and 2014 , and the related notes to the consolidated financial statements reflect the classification of its structured settlement business operating results as discontinued operations. See Note 7 , “ Discontinued Operations ,” for further information. Unless otherwise noted, the following notes refer to the Company’s continuing operations. Derivative Instrument In February 2014, the Company issued and sold $70.7 million in aggregate principal amount of 8.50% senior unsecured convertible notes due 2019 (the “Convertible Notes”). Prior to shareholder approval on June 5, 2014 to issue shares of common stock upon conversion of the Convertible Notes in excess of New York Stock Exchange limits for share issuances without shareholder approval, the Convertible 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 Convertible 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 Convertible Notes. The Convertible Notes are recorded at accreted value and will continue to be accreted up to the par value of the Convertible Notes at maturity. See Note 11 , " 8.50% Senior Unsecured Convertible Notes ." Foreign Currency The Company owns certain foreign subsidiary companies formed under the laws of Ireland, Bahamas and Bermuda. These foreign subsidiary companies utilize the U.S. dollar as their functional currency. Any gains and losses resulting from foreign currency transactions (transactions denominated in a currency other than the subsidiary companies functional currency) are included in income. 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 life settlements, the valuation of the debt owing under the Revolving Credit Facilities, the valuation of equity awards and the valuation of the conversion derivative liability formerly embedded within the Company’s Convertible Notes. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (‘FASB’) issued Accounting Standards Update (“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. In April 2015, the FASB voted to defer the effective date of the new revenue recognition standard by one year. As a result, the provisions of this ASU are now effective for interim and annual periods beginning after December 15, 2017. The Company does not expect that this guidance will have a material impact on its financial position, results of operations or cash flows. In August 2014, the FASB issued ASU No. 2014-15, “Disclosures of Uncertainties About an Entity’s Ability to Continue as a Going Concern.” The standard provides guidance around management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. The standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. Early adoption is permitted. The Company does not expect that this guidance will have a material impact on its financial position, results of operations or cash flows. In February 2015, the FASB issued ASU No. 2015-02, “Consolidation (Topic 810): Amendments to the Consolidation Analysis.” This guidance focuses on a reporting company’s consolidation evaluation to determine whether they should consolidate certain legal entities. This guidance is effective for annual periods beginning after December 15, 2015. Early adoption is permitted, including adoption in an interim period. The Company is currently evaluating the effect that this pronouncement will have on its consolidated financial statements, but does not anticipate it will be material. In April 2015, the FASB issued ASU No. 2015-03, “Interest—Imputation of Interest (Subtopic 835-30).” This standard provides guidance on the balance sheet presentation for debt issuance costs and debt discounts and debt premiums. To simplify the presentation of debt issuance costs, this standard requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability. This ASU is effective for fiscal years beginning after December 15, 2015. The Company does not expect that this guidance will have a material impact on its consolidated financial statements. |
Consolidation of Variable Inter
Consolidation of Variable Interest Entities | 9 Months Ended |
Sep. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Consolidation of Variable Interest Entities | 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 financial statements as of September 30, 2015 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 Assets Maximum Exposure To Loss September 30, 2015 $ 464,032 $ 214,019 $ 2,384 $ 2,384 December 31, 2014 $ 314,062 $ 146,254 $ 2,384 $ 2,384 As of September 30, 2015 , 439 life insurance policies owned by White Eagle with an aggregate death benefit of approximately $2.2 billion and an estimated fair value of approximately $327.4 million were pledged as collateral under the White Eagle Revolving Credit Facility. In accordance with ASC 810, Consolidation , the Company consolidated White Eagle in its financial statements for the three months and nine months ended September 30, 2015 and 2014 , and the year ended December 31, 2014 . As of September 30, 2015 , 157 life insurance policies owned by Red Falcon with an aggregate death benefit of approximately $604.8 million and an estimated fair value of approximately $117.4 million were pledged as collateral under the Red Falcon Revolving Credit Facility. In accordance with ASC 810, Consolidation , the Company consolidated Red Falcon in its financial statements for the three months and nine months ended September 30, 2015 . |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2015 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share As of September 30, 2015 and 2014 , there were 28,130,508 and 21,402,990 issued and outstanding shares of common stock, respectively. 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, adjusted to include expenses recognized associated with convertible debt, 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 and if-converted method, as applicable. The following tables reconcile actual basic and diluted earnings per share for the three months and nine months ended September 30, 2015 and 2014 (in thousands except share and per share data). For the Three Months Ended For the Nine Months Ended 2015(1) 2014(2) 2015(1) 2014(2) Income (loss) per share: Numerator: Net income (loss) from continuing operations $ (13,491 ) $ (4,264 ) $ (16,689 ) $ (13,863 ) Net income (loss) from discontinued operations $ (113 ) $ (249 ) $ (416 ) $ (454 ) Net income (loss) $ (13,604 ) $ (4,513 ) $ (17,105 ) $ (14,317 ) Basic and diluted income (loss) per common share: Basic and diluted income (loss) from continuing operations $ (0.48 ) $ (0.20 ) $ (0.70 ) $ (0.65 ) Basic and diluted income (loss) from discontinued operations $ — $ (0.01 ) $ (0.02 ) $ (0.02 ) Basic and diluted income (loss) per share available to common shareholders $ (0.48 ) $ (0.21 ) $ (0.72 ) $ (0.67 ) Denominator: Basic and diluted 28,084,254 21,361,930 23,827,030 21,352,086 (1) The computation of diluted EPS does not include 41,259 shares of restricted stock, 774,394 options, 6,240,521 warrants up to 10,738,165 shares of underlying common stock issuable upon conversion of the Convertible Notes and 323,500 performance shares, as the effect of their inclusion would have been anti-dilutive. (2) The computation of diluted EPS did not include 815,448 options, 6,240,521 warrants, 41,060 shares of restricted stock, up to 10,464,491 shares of underlying common stock issuable upon conversion of the Convertible 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. |
Stock-based Compensation
Stock-based Compensation | 9 Months Ended |
Sep. 30, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-based Compensation | Stock-based Compensation On May 28, 2015, the Company amended and restated its 2010 Omnibus Incentive Plan (as amended and restated, the “Omnibus Plan”). 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 for an aggregate of 2,700,000 shares of common stock to be reserved for issuance under the Omnibus Plan, subject to adjustment as provided in the Omnibus Plan. The Company recognized approximately $0 and $140,000 in stock-based compensation expense relating to stock options during the three months ended September 30, 2015 and 2014 , respectively, and approximately $237,000 and $632,000 during the nine months ended September 30, 2015 and 2014 , respectively. The Company incurred additional stock-based compensation expense of approximately $61,000 relating to restricted stock granted to its board of directors during the three months ended September 30, 2015 and 2014 , respectively, and approximately $192,000 and $130,000 during the nine months ended September 30, 2015 and 2014 , respectively. During 2014 , the Company awarded 323,500 target performance shares for restricted common stock to its directors and certain employees, of which 150,000 shares were subject to shareholder approval of the Omnibus Plan at the Company’s 2015 annual meeting, which was obtained on May 28, 2015. 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 evaluates on a quarterly basis whether it is probable that the Company’s financial performance conditions will be achieved. At September 30, 2015 and 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 months and nine months ended September 30, 2015 and 2014 , respectively. Options As of September 30, 2015 , options to purchase 774,394 shares of common stock were outstanding and unexercised under the Omnibus Plan at a weighted average exercise price of $8.50 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, 2015 : Common Stock Options Number of Shares Weighted Average Price per Share Weighted Average Remaining Contractual Term Aggregate Intrinsic Value Options outstanding, January 1, 2015 807,949 $ 8.50 4.48 — Options granted — — Options exercised — — Options forfeited (33,555 ) $ 8.50 — — Options expired — — Options outstanding, September 30, 2015 774,394 $ 8.50 3.73 — Exercisable at September 30, 2015 774,394 $ 8.50 3.73 — Unvested at September 30, 2015 — — — — As of September 30, 2015 , all outstanding stock options had an exercise price above the fair market value of the common stock on that date. During the three months ended September 30, 2015 and 2014 , the Company recognized expense of $0 and $140,000 , respectively, related to these options and $237,000 and $632,000 during the nine months ended September 30, 2015 and 2014 , respectively. There are no remaining unamortized amounts to be recognized on these options. Restricted Stock 17,286 shares of restricted stock granted to the Company’s 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 approximately $120,000 based on the closing price of the Company’s shares on the day prior to 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. Under the Omnibus Plan, 41,060 shares of restricted stock granted to the Company’s directors vested during the nine months ended September 30, 2015 . The fair value of the vested restricted stock was valued at approximately $255,000 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 and approximately $0 and $108,000 during the three months and nine months ended September 30, 2015 , respectively. During the nine months ended September 30, 2015 , 41,259 shares of restricted stock were granted to the Company’s directors under the Omnibus Plan, which are subject to a one year vesting period that commenced on the date of grant. The fair value of the unvested restricted stock was valued at approximately $255,000 based on the closing price of the Company’s shares on the day prior to the grant date. The Company expensed approximately $61,000 and $83,000 in stock based compensation related to these 41,259 shares of restricted stock during the three months and nine months periods ended September 30, 2015 , respectively. The following table presents the activity of the Company’s unvested shares of restricted stock for the nine months ended September 30, 2015 : Common Unvested Shares Number of Shares Outstanding January 1, 2015 41,060 Granted 41,259 Vested (41,060 ) Forfeited — Outstanding September 30, 2015 41,259 The aggregate intrinsic value of these awards is $230,000 and the remaining weighted average life of these awards is 0.7 years as of September 30, 2015 . Performance Shares During 2014, the Company awarded 323,500 target performance shares for restricted common stock to its directors and certain employees, of which 150,000 shares were subject to shareholder approval of the Omnibus Plan, which was obtained at the Company’s 2015 annual meeting on May 28, 2015. 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 323,500 shares. At September 30, 2015 , the Company determined that it was not probable that the performance conditions would be achieved and no related expense was recognized for the three months and nine months ended September 30, 2015 . If 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, 2015 : Performance Shares Number of Shares Outstanding January 1, 2015 323,500 Awarded — Vested — Forfeited — Outstanding September 30, 2015 323,500 Warrants On February 11, 2011, three shareholders received 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 are exercisable as they are fully vested. At September 30, 2015 , all 4,240,521 warrants remained outstanding. In connection with a settlement of class action litigation arising in connection with the USAO Investigation, 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, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | Discontinued Operations On October 25, 2013, the Company sold substantially all of the operating assets comprising its structured settlement business to Majestic Opco L.L.C for gross proceeds of $12.0 million pursuant to an Asset Purchase Agreement. 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. On August 28, 2015, the Company sold its remaining structured settlement receivables assets for $920,000 to the buyer of its operating assets, an entity to which the Company continues to provide CEO consulting services (with the Company's chief executive officer serving as interim chief executive officer) pursuant to a transition services arrangement. As a result of the sale of its structured settlements business, the Company reclassified its structured settlement business operating results as discontinued operations 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 2015 2014 2015 2014 Total income (loss) $ (13 ) $ 38 $ 60 $ 150 Total expenses (134 ) (287 ) (700 ) (604 ) Income (loss) before income taxes (147 ) (249 ) (640 ) (454 ) Income tax benefit 34 — 224 — Net income (loss) from discontinued operations $ (113 ) $ (249 ) $ (416 ) $ (454 ) |
Life Settlements (Life Insuranc
Life Settlements (Life Insurance Policies) | 9 Months Ended |
Sep. 30, 2015 | |
Investments, All Other Investments [Abstract] | |
Life Settlements (Life Insurance Policies) | 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 the Statements of Operations in the period in which the changes occur. As of September 30, 2015 and December 31, 2014 , the Company owned 634 and 607 policies, respectively, with an aggregate estimated fair value of life settlements of $457.8 million and $388.9 million , respectively. The weighted average life expectancy calculated based on death benefit of insureds in the policies owned by the Company at September 30, 2015 was 10.0 years. The following table describes the Company’s life settlements as of September 30, 2015 (dollars in thousands): Remaining Life Expectancy (In Years) Number of Life Settlement Contracts Estimated Fair Value Face Value 0 - 1 — $ — $ — 1 - 2 9 21,516 32,307 2 - 3 20 52,926 95,122 3 - 4 19 29,638 70,309 4 - 5 25 33,129 96,406 Thereafter 561 320,601 2,703,759 Total 634 $ 457,810 $ 2,997,903 The weighted average life expectancy calculated based on death benefit of insureds in the policies owned by the Company at December 31, 2014 was 10.7 years. The following table describes the Company’s life settlements as of December 31, 2014 (dollars in thousands): Remaining Life Expectancy (In Years) Number of Life Settlement Contracts Estimated Fair Value Face Value 0-1 — $ — $ — 1-2 4 9,227 12,728 2-3 10 23,202 45,852 3-4 16 29,531 67,735 4-5 19 23,012 65,614 Thereafter 558 303,914 2,739,137 Total 607 $ 388,886 $ 2,931,066 Estimated premiums to be paid for each of the five succeeding fiscal years to keep the life insurance policies in force as of September 30, 2015 , are as follows (in thousands): Remainder of 2015 $ 16,292 2016 68,891 2017 75,602 2018 78,260 2019 85,030 Thereafter 1,110,449 $ 1,434,524 The amount of $1.43 billion noted above represents the estimated total future premium payments required to keep the life insurance policies in force during the life expectancies of all the underlying insured lives 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. |
White Eagle Revolving Credit Fa
White Eagle Revolving Credit Facility | 9 Months Ended |
Sep. 30, 2015 | |
Revolving Credit Facility | |
Debt Instrument [Line Items] | |
White Eagle Revolving Credit Facility | White Eagle Revolving Credit Facility Effective April 29, 2013 , White Eagle entered into a 15 -year revolving credit agreement with LNV Corporation, as initial lender, Imperial Finance & Trading, LLC, as servicer and portfolio manager and CLMG Corp., as administrative agent, providing for up to $300.0 million in borrowings. Proceeds from the initial advance under the facility were used, in part, to retire a bridge facility and to fund a payment to the lender protection insurance provider to release subrogation rights in certain of the policies pledged as collateral for the White Eagle 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, the White Eagle Revolving Credit Facility was amended and restated 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. As of September 30, 2015 , 439 life insurance policies owned by White Eagle with an aggregate death benefit of approximately $2.2 billion and an estimated fair value of approximately $327.4 million are pledged as collateral under the White Eagle Revolving Credit Facility. General & Security . The White Eagle 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. 439 life insurance policies with an aggregate death benefit of approximately $2.2 billion and an estimated fair value of approximately $327.4 million are pledged as collateral under the White Eagle Revolving Credit Facility at September 30, 2015 . In addition, the equity interests in White Eagle have been pledged under the White Eagle Revolving Credit Facility. Borrowing Base. Borrowing availability under the White Eagle 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, 2015 , $140.1 million was undrawn and $1.9 million was available to borrow under the White Eagle Revolving Credit Facility. Amortization & Distributions. Proceeds from the maturity of the policies pledged as collateral under the White Eagle Revolving Credit Facility are 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, up to $76.1 million in collections from policy proceeds are to be paid to White Eagle, 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 White Eagle 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 with respect to 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 White Eagle 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 White Eagle 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, 2015 was 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 White Eagle Revolving Credit Facility debt. Interest expense on the facility was $2.3 million and $2.1 million , which includes $1.7 million and $1.5 million withheld from borrowings by the lender and $634,000 and $573,000 paid by White Eagle, for the three months ended September 30, 2015 and 2014 , respectively. During the nine months ended September 30, 2015 and 2014 , interest expense on the facility was $6.9 million and $5.8 million , which includes $5.0 million and $4.2 million withheld from borrowings by the lender and $1.9 million and $1.6 million paid by White Eagle, respectively. Maturity. The term of the White Eagle 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 White Eagle Revolving Credit Facility or expiration of the lenders’ commitments. Covenants/Events of Defaults . The White Eagle 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 White Eagle Revolving Credit Facility (including in relation to breaches by third parties thereunder), certain changes in law, changes in control of or insolvency or bankruptcy of the Company and relevant subsidiary companies and performance of certain obligations by certain relevant subsidiary companies, White Eagle and third parties. The White Eagle 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 White Eagle Revolving Credit Facility and ancillary transaction documents afford the lenders a high degree of discretion in their selection and implementation of remedies, including strict foreclosure, 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. The Company elected to account for the debt under the White Eagle 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. The Company 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, the Company’s estimates are not necessarily indicative of the amounts that the Company, 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, 2015 , the fair value of the outstanding debt was $157.9 million and the borrowing base was approximately $161.8 million , including $159.9 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. |
Red Falcon Revolving Credit Fac
Red Falcon Revolving Credit Facility - Revolving Credit Facility | 9 Months Ended |
Sep. 30, 2015 | |
Debt Instrument [Line Items] | |
Red Falcon Revolving Credit Facility | White Eagle Revolving Credit Facility Effective April 29, 2013 , White Eagle entered into a 15 -year revolving credit agreement with LNV Corporation, as initial lender, Imperial Finance & Trading, LLC, as servicer and portfolio manager and CLMG Corp., as administrative agent, providing for up to $300.0 million in borrowings. Proceeds from the initial advance under the facility were used, in part, to retire a bridge facility and to fund a payment to the lender protection insurance provider to release subrogation rights in certain of the policies pledged as collateral for the White Eagle 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, the White Eagle Revolving Credit Facility was amended and restated 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. As of September 30, 2015 , 439 life insurance policies owned by White Eagle with an aggregate death benefit of approximately $2.2 billion and an estimated fair value of approximately $327.4 million are pledged as collateral under the White Eagle Revolving Credit Facility. General & Security . The White Eagle 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. 439 life insurance policies with an aggregate death benefit of approximately $2.2 billion and an estimated fair value of approximately $327.4 million are pledged as collateral under the White Eagle Revolving Credit Facility at September 30, 2015 . In addition, the equity interests in White Eagle have been pledged under the White Eagle Revolving Credit Facility. Borrowing Base. Borrowing availability under the White Eagle 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, 2015 , $140.1 million was undrawn and $1.9 million was available to borrow under the White Eagle Revolving Credit Facility. Amortization & Distributions. Proceeds from the maturity of the policies pledged as collateral under the White Eagle Revolving Credit Facility are 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, up to $76.1 million in collections from policy proceeds are to be paid to White Eagle, 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 White Eagle 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 with respect to 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 White Eagle 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 White Eagle 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, 2015 was 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 White Eagle Revolving Credit Facility debt. Interest expense on the facility was $2.3 million and $2.1 million , which includes $1.7 million and $1.5 million withheld from borrowings by the lender and $634,000 and $573,000 paid by White Eagle, for the three months ended September 30, 2015 and 2014 , respectively. During the nine months ended September 30, 2015 and 2014 , interest expense on the facility was $6.9 million and $5.8 million , which includes $5.0 million and $4.2 million withheld from borrowings by the lender and $1.9 million and $1.6 million paid by White Eagle, respectively. Maturity. The term of the White Eagle 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 White Eagle Revolving Credit Facility or expiration of the lenders’ commitments. Covenants/Events of Defaults . The White Eagle 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 White Eagle Revolving Credit Facility (including in relation to breaches by third parties thereunder), certain changes in law, changes in control of or insolvency or bankruptcy of the Company and relevant subsidiary companies and performance of certain obligations by certain relevant subsidiary companies, White Eagle and third parties. The White Eagle 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 White Eagle Revolving Credit Facility and ancillary transaction documents afford the lenders a high degree of discretion in their selection and implementation of remedies, including strict foreclosure, 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. The Company elected to account for the debt under the White Eagle 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. The Company 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, the Company’s estimates are not necessarily indicative of the amounts that the Company, 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, 2015 , the fair value of the outstanding debt was $157.9 million and the borrowing base was approximately $161.8 million , including $159.9 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. |
Red Falcon Trust | |
Debt Instrument [Line Items] | |
Red Falcon Revolving Credit Facility | Red Falcon Revolving Credit Facility Effective July 16, 2015 , Red Falcon Trust (“Red Falcon”), a Delaware statutory trust formed by Blue Heron Designated Activity Company (“Blue Heron”), a wholly-owned Irish subsidiary of the Company, entered into a revolving loan and security agreement (together with its ancillary documents, the “Red Falcon Revolving Credit Facility”) with LNV Corporation, as initial lender, the other lenders party thereto from time to time, Imperial Finance & Trading, LLC, as guarantor, Blue Heron as portfolio administrator and CLMG Corp., as administrative agent (the “Agent”). General & Security . The Red Falcon Revolving Credit Facility provides for a revolving credit facility backed by Red Falcon’s portfolio of life insurance policies with an initial aggregate lender commitment of up to $110.0 million , subject to borrowing base availability. As of September 30, 2015 , 157 life insurance policies owned by Red Falcon with an aggregate death benefit of approximately $604.8 million and an estimated fair value of approximately $117.4 million are pledged as collateral under the Red Falcon Revolving Credit Facility. In connection with the Red Falcon Revolving Credit Facility, the residual interests in Red Falcon have also been pledged. Borrowing Base & Availability . Revolving credit borrowings are permitted for a five-year period with the loans under the Red Falcon Revolving Credit Facility maturing on July 15, 2022. Borrowing availability under the Red Falcon 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 in respect of newly pledged policies that are not for ongoing maintenance advances, plus (ii) 100% of the sum of the ongoing maintenance costs, less (iii) any required amortization payments previously distributed and to be distributed through the next distribution date; (B) 60% of the valuation of the policies pledged as collateral as determined by the lenders; (C) 45% of the aggregate face amount of the policies pledged as collateral; and (D) $110.0 million . At September 30, 2015 , $54.9 million was undrawn and $110,000 was available to borrow under the Red Falcon Revolving Credit Facility. Amortization & Distributions. Proceeds from the policies pledged as collateral under the Red Falcon Revolving Credit Facility are distributed pursuant to a waterfall with, subject to yield maintenance provisions, 5% of policy proceeds directed to the lenders. Thereafter proceeds are directed to pay fees to service providers and premiums with any remaining proceeds directed to pay outstanding interest and required amortization of 8% per annum on the greater of the then outstanding balance of the loan or the initial advance. Generally, after payment of interest and required amortization, a percentage of the collections from policy proceeds are to be paid to the lenders, which will vary depending on the then loan to value ratio (“LTV”) as follows: (1) if the LTV is equal to or greater than 50% , all remaining proceeds will be directed to the lenders to repay the then outstanding principal balance; (2) if the LTV is less than 50% but greater than or equal to 25% , 65% of the remaining proceeds will be directed the lenders to repay the then outstanding principal balance; or (3) if the LTV is less than 25% , 35% of the remaining proceeds will be directed to the lenders to repay the then outstanding principal balance. To the extent there are not sufficient remaining proceeds in the waterfall to satisfy the amount of required interest and amortization then due, Red Falcon will pay any such shortfall amount. Initial Advance and Use of Proceeds. Amounts advanced to Red Falcon following effectiveness of the Red Falcon Revolving Credit Facility were approximately $54.0 million with certain of the proceeds used to pay transaction expenses and to purchase the policies pledged as collateral under the Red Falcon Revolving Credit Facility from certain affiliates of the Company, who then made a distribution to the Company which was used to redeem the Secured Notes; see Note 12. Generally, ongoing advances may be made for paying premiums on the life insurance policies pledged as collateral, and to pay the fees of service providers. Subsequent advances in respect of newly pledged policies are at the discretion of the lenders. Interest. Borrowings under the Red Falcon 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 4.50% and subject to a rate floor of 1.0% . The base rate under the Red Falcon 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 interest rate at September 30, 2015 was 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 Red Falcon Revolving Credit Facility. Interest expense on the facility was $3.8 million , which includes $3.2 million relating to the debt issuance cost which was not capitalized as a result of electing the fair value option for valuing this debt, and $601,000 relating to interest payments paid by Red Falcon, for the three months and nine months ended September 30, 2015 . Maturity. The term of the Red Falcon Revolving Credit Facility expires July 15, 2022 . Covenants/Events of Defaults . The Red Falcon Revolving Credit Facility contains covenants and events of default, including those that are customary for asset-based credit facilities of this type and including cross defaults under the servicing, portfolio management and sales agreements entered into in connection with the Red Falcon Revolving Credit Facility, changes in control of or insolvency or bankruptcy of the Company and relevant subsidiary companies and performance of certain obligations by certain relevant subsidiary companies, Red Falcon and third parties. The Red Falcon Revolving Credit Facility does not contain any financial covenants, but does contain certain tests relating to asset maintenance, performance and valuation with determinations as to the satisfaction of such tests involving determinations made by the lenders with a high degree of discretion. The Company elected to account for the debt under the Red Falcon Revolving Credit Facility 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. The Company 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, the Company’s estimates are not necessarily indicative of the amounts that the Company, 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, 2015 , the fair value of the outstanding debt was $55.7 million and the borrowing base was approximately $55.2 million , including $55.1 million in outstanding principal. |
8.50% Senior Unsecured Converti
8.50% Senior Unsecured Convertible Notes | 9 Months Ended |
Sep. 30, 2015 | |
8.50% Senior Unsecured Convertible Notes Due 2019 | |
Debt Instrument [Line Items] | |
Senior Unsecured Notes | 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 Convertible 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 Convertible Notes to qualified institutional buyers pursuant to Rule 144A of the Securities Act of 1933. The Convertible Notes were issued pursuant to an indenture dated February 21, 2014 , between the Company and U.S. Bank National Association, as trustee. Two members of the Company’s Board of Directors, Messrs. Dakos and Goldstein, are affiliated with Bulldog Investors, LLC, who purchased Convertible Notes in the aggregate principal amount of $9.2 million in the offering. The Convertible Notes are general senior unsecured obligations and rank equally in right of payment with all of the Company’s other existing and future senior unsecured indebtedness. The Convertible Notes are effectively subordinate to all of the Company’s secured indebtedness to the extent of the value of the assets collateralizing such indebtedness. The Convertible Notes are not guaranteed by the Company’s subsidiaries. The maturity date of the Convertible Notes is February 15, 2019 . The Convertible Notes accrue interest at the rate of 8.50% per annum on the principal amount of the Convertible Notes, payable semi-annually in arrears on August 15 and February 15 of each year . The Convertible 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. Initially, the Convertible Notes were convertible into shares of common stock at a conversion rate of 147.9290 shares of common stock per $1,000 principal amount of Convertible Notes (equivalent to a conversion price of $6.76 per share of common stock). In the second quarter of 2015, the conversion rate was adjusted to 151.7912 shares of common stock per $1,000 principal amount of Convertible Notes (equivalent to a conversion price of $6.59 per share of common stock) in connection with anti-dilution adjustment triggered by a rights offering that resulted in the issuance of 6,688,433 shares of the Company’s stock. The Company may not redeem the Convertible 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 Convertible 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 Convertible Notes, plus any accrued and unpaid interest to, but excluding, the redemption date. In addition, if the Company calls the Convertible Notes for redemption, a make-whole fundamental charge will be deemed to occur. As a result, the Company 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 Convertible 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 Convertible 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 Convertible Notes. The Convertible Notes are recorded at accreted value and will continue to be accreted up to the par value of the Convertible 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 40.0 % 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, 2015 , the carrying value of the Convertible Notes was $57.9 million . The unamortized debt discount and origination cost of $12.8 million and $1.9 million , respectively, will be amortized over the remaining life of the Convertible Notes, using the effective interest method. The Company recorded $2.3 million and $2.2 million of interest expense on the Convertible Notes, including $1.5 million , $711,000 and $105,000 and $1.5 million , $605,000 and $90,000 from interest, amortizing debt discounts and issuance costs, during the three months ended September 30, 2015 and 2014 , respectively. During the nine months ended September 30, 2015 and 2014 , the Company recorded $6.8 million and $5.3 million of interest expense on the Convertible Notes, including $4.5 million , $2.0 million and $294,000 and $3.7 million , $1.4 million and $239,000 from interest, amortizing debt discounts and issuance costs, respectively. 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 . |
12.875% Senior Secured Notes
12.875% Senior Secured Notes | 9 Months Ended |
Sep. 30, 2015 | |
12.875% Senior Secured Notes | |
Debt Instrument [Line Items] | |
Senior Unsecured Notes | 12.875% Senior Secured Notes On November 10, 2014 (the “Initial Closing Date”), the Company, as issuer, entered into an indenture with certain of its subsidiary companies, 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 provided for the issuance of up to $100 million in senior secured notes (the “Secured Notes), of which $25 million was issued by the Company 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 the Company 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. On January 21, 2015, the Company issued an additional $25.0 million in aggregate principal amount of Secured Notes, which were purchased by the Purchaser under the Note Purchase Agreement at 96% of their principal amount. Fees and expenses paid by the Company in connection with the Initial Closing Date and its subsequent issuance were approximately $1.8 million and $305,000 , respectively. Interest on issued Secured Notes accrued at 12.875% per annum and all Secured Notes issued under the indenture were scheduled to mature on November 10, 2017 . The Secured Notes were guaranteed by the Guarantors and were secured by substantially all of the Company’s and Guarantors’ assets, other than those securing the White Eagle Revolving Credit Facility, including cash on account as well as the Company’s life insurance policies that were not pledged as collateral under the White Eagle Revolving Credit Facility. The Secured Notes were also secured by pledges of the equity interests of the Guarantors and by pledges of 65% of their first tier foreign subsidiary companies. On July 16, 2015, the Company redeemed all of the outstanding Secured Notes and discharged the Secured Note indenture. The Secured Notes were redeemed at 106% of their principal amount plus interest up to but excluding November 10, 2015. Effective as of the redemption of the Secured Notes, 159 of the life insurance policies that served as collateral for the Secured Notes were sold to Red Falcon in an internal transfer and pledged as collateral under the Red Falcon Revolving Credit Facility. Approximately $8.8 million was expensed as extinguishment related to the early repayment of the facility, in July 2015. This includes $5.2 million , $171,000 , $1.7 million and $1.7 million related to interest and prepayment penalties, unused fees, write off of debt discount and write off of issuance cost. The Company recorded $4.0 million of interest expense on the Secured Notes, including $3.2 million , $265,000 , $264,000 and $277,000 from interest, unused fees, amortizing debt discounts and issuance costs, during the nine months ended September 30, 2015 . |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The Company carries life settlements and debt under the Revolving Credit Facilities 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 measured at fair value on a recurring basis as of September 30, 2015 , are as follows (in thousands): Level 1 Level 2 Level 3 Total Fair Value Assets: Life settlements $ — $ — $ 457,810 $ 457,810 $ — $ — $ 457,810 $ 457,810 The balances of the Company’s liabilities measured at fair value on a recurring basis as of September 30, 2015 are as follows (in thousands): Level 1 Level 2 Level 3 Total Fair Value Liabilities: White Eagle Revolving Credit Facility $ — $ — $ 157,946 $ 157,946 Red Falcon Revolving Credit Facility — — 55,685 55,685 $ — $ — $ 213,631 $ 213,631 The balances of the Company’s assets measured at fair value on a recurring basis as of December 31, 2014 , are as follows (in thousands): Level 1 Level 2 Level 3 Total Fair Value Assets: Life settlements $ — $ — $ 388,886 $ 388,886 Structured settlement receivables — — 384 384 $ — $ — $ 389,270 $ 389,270 The balances of the Company’s liabilities measured at fair value on a recurring basis as of December 31, 2014 , are as follows (in thousands): Level 1 Level 2 Level 3 Total Fair Value Liabilities: White Eagle Revolving Credit Facility $ — $ — $ 145,831 $ 145,831 $ — $ — $ 145,831 $ 145,831 The Company values its 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 although the Company believes that this risk premium has been declining. ($ in thousands) Quantitative Information about Level 3 Fair Value Measurements Fair Value Aggregate Valuation Technique Unobservable Input (s) Range (Weighted Average) Non-premium financed $ 97,022 $ 343,803 Discounted cash flow Discount rate 15.00% - 21.00% Life expectancy evaluation (6.6 years) Premium financed $ 360,788 $ 2,654,100 Discounted cash flow Discount rate 16.00% - 24.75% Life expectancy evaluation (10.5 years) Life settlements $ 457,810 $ 2,997,903 Discounted cash flow Discount rate 17.00% Life expectancy evaluation (10.0 years) White Eagle Revolving Credit Facility $ 157,946 N/A Discounted cash flow Discount rate 23.55% Life expectancy evaluation (9.9 years) Red Falcon Revolving Credit Facility $ 55,685 N/A Discounted cash flow Discount Rate 11.18% Life expectancy evaluation (9.5 years) 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. 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 its 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 the Company believes 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 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. Since the quarter ended September 30, 2012, the Company has used a modified version of the 2008 Valuation Basic Table (“2008 VBT”), a mortality table developed by the U.S. Society of Actuaries (the “SOA”). 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 provider. The resulting mortality factors are then blended to determine a factor for each insured. To generate the 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. During the three months ended September 30, 2015 , the SOA released tables for an updated Valuation Basic Table (the “2015 VBT”). The Company is continuing to monitor the market reaction to the VBT. Additionally, the Company will continue to monitor its mortality experience to determine whether future adoption of the 2015 VBT would be an appropriate change to the Company’s valuation technique. Future changes in the life expectancies could have a material effect on the fair value of the Company’s life settlements, which could have a material adverse effect on its business, financial condition and results of operations. 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 $ 384,990 $ (72,820 ) - $ 457,810 — -6 $ 536,666 $ 78,856 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 the Company’s 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, the Company seeks to hold policies issued by insurance companies that are rated investment grade. At September 30, 2015 , the Company had eighteen 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 the Company’s life settlements as of September 30, 2015 : Carrier Percentage of Total Fair Value Percentage of Total Death Benefit Moody's Rating S&P Rating Transamerica Life Insurance Company 20.6 % 20.5 % A1 AA- Lincoln National Life Insurance Company 21.6 % 19.6 % A1 AA- Estimated risk premium As of September 30, 2015 , the Company owned 634 policies with an estimated fair value of $457.8 million . Of these 634 policies, 547 were previously premium financed and are valued using discount rates that range from 16.00% to 24.75% . The remaining 87 policies, which are non-premium financed, are valued using discount rates that range from 15.00% to 21.00% . As of September 30, 2015 , the weighted average discount rate calculated based on death benefit used in valuing the policies in the Company’s life settlement portfolio was 17.00% . The discount rate incorporates current information about market interest rates, the credit exposure to the insurance company that issued the life insurance policy and the Company’s 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 16.50% -0.50% $ 469,610 $ 11,800 17.00% — $ 457,810 $ — 17.50% +0.50% $ 446,512 $ (11,298 ) Future changes in the discount rates the Company uses to value life insurance policies could have a material effect on the Company’s yield on life settlement transactions, which could have a material adverse effect on its business, financial condition and results of its operations. At the end of each reporting period the Company re-values the life insurance policies using the Company’s valuation model in order to update its estimate of fair value for investments in policies held on its balance sheet. This includes reviewing the Company’s assumptions for discount rates and life expectancies as well as incorporating current information for premium payments and the passage of time. White Eagle Revolving Credit Facility — 439 policies are pledged by White Eagle to serve as collateral for its obligations under the White Eagle Revolving Credit Facility. Absent an event of default under the White Eagle 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. The Company has 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. The Company calculated the fair value of the debt using a discounted cash flow model taking into account the stated interest rate of the White Eagle Revolving Credit Facility and probabilistic cash flows from the pledged policies. Accordingly, the Company’s estimates are not necessarily indicative of the amounts that the Company, 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 the policies securing the White Eagle Revolving Credit Facility A considerable portion of the fair value of the White Eagle Revolving Credit Facility 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 White Eagle Revolving Credit Facility live six months shorter or longer than the life expectancies used to calculate the estimated fair value of the White Eagle Revolving Credit Facility debt, the change in estimated fair value would be as follows (dollars in thousands): Life Expectancy Months Adjustment Fair Value of White Eagle Revolving Credit Facility Change in Value +6 $ 132,093 $ (25,853 ) $ 157,946 — -6 $ 182,793 $ 24,847 Future changes in the life expectancies could have a material effect on the fair value of the White Eagle Revolving Credit Facility, which could have a material adverse effect on its business, financial condition and results of operations. Discount rate of the White Eagle Revolving Credit Facility The discount rate incorporates current information about market interest rates, credit exposure to insurance companies and the Company’s estimate of the return a lender lending against the policies would require. Market interest rate sensitivity analysis of the White Eagle Revolving Credit Facility The extent to which the fair value of the White Eagle Revolving Credit Facility 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 White Eagle Revolving Credit Facility as of September 30, 2015 would be as follows (dollars in thousands): Discount Rate Rate Adjustment Fair Value of White Eagle Revolving Credit Facility Change in Value 23.05% -0.50 % $ 160,730 $ 2,784 23.55% — $ 157,946 $ — 24.05% +0.50 % $ 155,255 $ (2,691 ) Future changes in the discount rates could have a material effect on the fair value of the White Eagle Revolving Credit Facility, which could have a material adverse effect on its business, financial condition and results of its operations. At September 30, 2015 , the fair value of the debt was $157.9 million and the outstanding principal was approximately $159.9 million . Red Falcon Revolving Credit Facility — 157 policies are pledged by Red Falcon to serve as collateral for its obligations under the Red Falcon Revolving Credit Facility. Proceeds from the policies pledged as collateral under the Red Falcon Credit Facility are distributed pursuant to a waterfall with, subject to yield maintenance provisions, 5% of policy proceeds directed to the lenders. Thereafter proceeds are directed to pay fees to service providers and premiums with any remaining proceeds directed to pay outstanding interest and required amortization of 8% per annum on the loan. Generally, after payment of interest and required amortization, a percentage of the collections from policy proceeds are to be paid to the lenders, which will vary depending on the then loan to value ratio (“LTV”) as follows: (1) if the LTV is equal to or greater than 50% , all remaining proceeds will be directed to the lenders to repay the then outstanding principal balance; (2) if the LTV is less than 50% but greater than or equal to 25% , 65% of the remaining proceeds will be directed to the lenders to repay the then outstanding principal balance; or (3) if the LTV is less than 25% , 35% of the remaining proceeds will be directed to the lenders to repay the then outstanding principal balance. The Company has elected to account for this long-term debt 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. The Company calculated the fair value of the debt using a discounted cash flow model taking into account the stated interest rate of the Red Falcon Revolving Credit Facility and probabilistic cash flows from the pledged policies. Accordingly, the Company’s estimates are not necessarily indicative of the amounts that the Company, 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 the policies securing the Red Falcon Revolving Credit Facility A considerable portion of the fair value of the Red Falcon Revolving Credit Facility 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 Red Falcon Credit Facility live six months shorter or longer than the life expectancies used to calculate the estimated fair value of the Red Falcon Revolving Credit Facility, the change in estimated fair value would be as follows (dollars in thousands): Life Expectancy Months Adjustment Fair Value of Red Falcon Revolving Credit Facility Change in Value +6 $ 53,734 $ (1,951 ) $ 55,685 — -6 $ 57,236 $ 1,551 Future changes in the life expectancies could have a material effect on the fair value of the Red Falcon Revolving Credit Facility, which could have a material adverse effect on its business, financial condition and results of operations. Discount rate of the Red Falcon Revolving Credit Facility The discount rate incorporates current information about market interest rates, credit exposure to insurance companies and the Company’s estimate of the return a lender lending against the policies would require. Market interest rate sensitivity analysis of the Red Falcon Revolving Credit Facility The extent to which the fair value of the Red Falcon Revolving Credit Facility 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 Red Falcon Revolving Credit Facility as of September 30, 2015 would be as follows (dollars in thousands): Discount Rate Rate Adjustment Fair Value of Red Falcon Revolving Credit Facility Change in Value 10.68% -0.50 % $ 56,523 $ 838 11.18% — $ 55,685 $ — 11.68% +0.50 % $ 54,868 $ (817 ) Future changes in the discount rates could have a material effect on the fair value of the Red Falcon Revolving Credit Facility, which could have a material adverse effect on its business, financial condition and results of its operations. At September 30, 2015 , the fair value of the debt was $55.7 million and the outstanding principal was approximately $55.1 million . Senior Unsecured Convertible Notes —The Company determined that an embedded conversion option in the Convertible 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 Convertible Notes. The Convertible Notes continue to be recorded at accreted value up to the par value of the Convertible Notes at maturity. See Note 11 , “ 8.50% Senior Unsecured Convertible Notes .” Although the Company believes its 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 nine months ended September 30, 2015 , for all assets for which the Company determines fair value using a material level of unobservable (Level 3) inputs, which consists solely of life settlements (in thousands): Life Settlements: Balance, January 1, 2015 $ 388,886 Purchase of policies 30,534 Change in fair value 43,582 Matured/lapsed/sold policies (53,435 ) Premiums paid 48,243 Transfers into level 3 — Transfer out of level 3 — Balance, September 30, 2015 $ 457,810 Changes in fair value included in earnings for the period relating to assets held at September 30, 2015 $ 2,805 The following table provides a roll-forward in the changes in fair value for nine months ended September 30, 2015 , for the White Eagle Revolving Credit Facility for which the Company determines fair value using a material level of unobservable (Level 3) inputs (in thousands): White Eagle Revolving Credit Facility: Balance, January 1, 2015 $ 145,831 Draws under the White Eagle Revolving Credit Facility 42,448 Payments on credit facility (43,241 ) Unrealized change in fair value 12,908 Transfers into level 3 — Transfer out of level 3 — Balance, September 30, 2015 $ 157,946 Changes in fair value included in earnings for the period relating to liabilities held at September 30, 2015 $ 12,908 The following table provides a roll-forward in the changes in fair value for nine months ended September 30, 2015 , for the Red Falcon Revolving Credit Facility for which the Company determines fair value using a material level of unobservable (Level 3) inputs (in thousands): Red Falcon Revolving Credit Facility: Balance, January 1, 2015 $ — Initial advance under the Red Falcon Revolving Credit Facility 54,000 Subsequent draws under the Red Falcon Revolving Credit Facility 2,967 Payments on Red Falcon Revolving Credit Facility (1,863 ) Unrealized change in fair value 581 Transfers into level 3 — Transfer out of level 3 — Balance, September 30, 2015 $ 55,685 Changes in fair value included in earnings for the period relating to liabilities held at September 30, 2015 $ 581 The following table provides a roll-forward in the changes in fair value for nine months ended September 30, 2014 , for all assets for which the Company determines fair value using a material level of unobservable (Level 3) inputs, which consist solely of life settlements (in thousands): Life Settlements: Balance, January 1, 2014 $ 302,961 Purchase of policies 3,488 Change in fair value 19,313 Matured/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 the nine months ended September 30, 2014 , for the White Eagle Revolving Credit Facility and conversion derivative liability for which the Company determines fair value using a material level of unobservable (Level 3) inputs (in thousands): White Eagle Revolving Credit Facility: 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 $ — There were no transfers of financial assets or liabilities between levels of the fair value hierarchy during the nine months ended September 30, 2015 and 2014 . |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2015 | |
Segment Reporting [Abstract] | |
Segment Information | 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, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Lease Agreements The Company leases office space under a lease that commenced on October 1, 2014 and 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 was approximately $122,000 and $126,000 for the three months ended September 30, 2015 and 2014 , respectively, and approximately $319,000 and $377,000 for the nine months ended September 30, 2015 and 2014 , respectively. Future minimum lease payments for the remainder of 2015 are approximately $58,000 . Employment Agreements The Company has entered into employment agreements with certain of its officers, including with its chief executive officer, whose agreement provides for substantial payments in the event that the executive terminates his employment with the Company 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 the chief executive officer’s base salary and the average of the preceding three years’ annual cash bonus. The Company does not have any general policies regarding the use of employment agreements, but has and 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. Separation Agreement 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 $998,000 and $500,000 during the three months ended September 30, 2015 and 2014 , respectively, and $2.5 million and $1.5 million during the nine months ended September 30, 2015 and 2014 , respectively. 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 & Indemnification Obligations 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”) in connection with the Company’s now legacy 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 now legacy premium finance business. The Non-Prosecution Agreement had a term of three years and expired in accordance with its terms on April 30, 2015. While the Non-Prosecution Agreement effectively resolved the USAO Investigation as it pertains to the Company, the Company still has continuing cooperation obligations to the USAO and understands that the USAO is continuing to investigate certain individuals and entities formerly associated with the Company's legacy premium finance business. Settlements of certain civil litigation with the Company’s director and officer liability insurance carriers related to the USAO Investigation and other contractual obligations require the Company to advance legal fees to and indemnify these individuals and entities. USAO litigation-related fees (inclusive of indemnification and advancement expenses) of $2.8 million and $1.2 million were recognized for the three months ended September 30, 2015 and 2014 , respectively, and $7.0 million and $3.2 million were recognized for the nine months ended September 30, 2015 and 2014 , respectively. The Company expects to continue to incur indemnification and advancement expenses and expenses related to continuing obligations related to the USAO investigation. Ongoing expenses in respect of these obligations, while currently unquantifiable, have been substantial in prior periods and could continue to have a material adverse effect on the Company’s financial position and results of operations. SEC Investigation On February 17, 2012, the Company 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 ”), asserting, among other things, that at least 28 life insurance policies issued by Sun Life and owned by the Company through certain of its subsidiary companies were invalid. The Sun Life complaint, as amended, asserted the following claims: (1) violations of the federal Racketeer Influenced and Corrupt Organizations (“RICO”) Act, (2) conspiracy to violate the RICO Act, (3) common law fraud, (4) aiding and abetting fraud, (5) civil conspiracy to commit fraud, (6) tortious interference with contractual obligations, and (7) a declaration that the policies issued were void. Following the filing of a motion by the Company to dismiss the Sun Life Case, on December 9, 2014, counts (2), (4), (5), (6) and (7) of the Sun Life Case were dismissed with prejudice. The Company then filed a motion for summary judgment on the remaining counts. On February 4, 2015, the Court issued an order (the “Order”) granting the Company’s motion for summary judgment on counts (1) and (3), resulting in the Company prevailing on all counts in the Sun Life Case. On July 29, 2013, the Company filed a separate complaint against Sun Life in United States District Court for the Southern District of Florida, entitled Imperial Premium Finance, LLC v. Sun Life Assurance Company of Canada (“ Imperial Case ”), which was subsequently consolidated with the Sun Life Case. The Imperial 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, which was denied by the Court as part of the Order. On February 26, 2015, Sun Life filed a Notice of Appeal to the United States Court of Appeals for the Eleventh Circuit from the Order, which had denied Sun Life’s motion to dismiss. The District Court has stayed the Imperial Case until Sun Life’s appeal is resolved by the Eleventh Circuit, which has been fully briefed by the parties. IRS Investigation The Internal Revenue Service (“IRS”) Criminal Investigation Division notified the Company in February 2014 that it 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. 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, cash flows and its results of operations. The Company has not established any provision for losses related to this matter. Class Action Litigation On January 20, 2015, a purported shareholder of the Company filed a putative class action complaint against the Company, and the individual members of the Board of Directors, in the Circuit Court of the 15th Judicial Circuit, in and for Palm Beach County, entitled Harry Rothenberg v. Imperial Holdings, Inc., et al. (the “State Court Complaint”). The Rothenberg State Court Complaint alleged breaches of fiduciary duties of due care and sought to invalidate a by-law amendment adopted by the Board of Directors on October 30, 2014, which requires current and former shareholders who wish to file a class or derivative action against the Company, its directors or its officers to first obtain written consent from shareholders beneficially owning at least 3% of the outstanding shares of the Company. On March 2, 2015, the Company filed a motion to dismiss and motion to strike certain allegations in the State Court Complaint. On April 20, 2015, Mr. Rothenberg filed a Verified Shareholder Class Action and Derivative Complaint (the “Federal Court Complaint”) in the United States District Court for the Southern District of Florida, which named the same defendants and asserted similar claims as in the State Court Complaint. The Federal Court Complaint also alleged violations of Sections 14(a) and 20(a) of the 1934 Securities Act, and asserted derivative claims for breach of fiduciary duty, among other claims, based on the previously disclosed IRS Investigation and allegations regarding the Company’s prior structured settlement business made in a case styled Michael Lafontant v. Washington Square Financial, LLC, et al. (“Lafontant Complaint”), which was filed in the United States District Court for the Southern District of New York. The Company has moved to dismiss the Lafontant Complaint based on contractual arbitration provisions, which is pending an order by the district court. On April 21, 2015, Mr. Rothenberg voluntarily dismissed the State Court Complaint, without prejudice. On June 9, 2015, Mr. Rothenberg filed an Amended Complaint. On June 29, 2015, the Company filed a motion to dismiss the Amended Complaint for lack of subject matter jurisdiction due to lack of injury in fact and ripeness and failure to state a claim pursuant to the Federal Rules of Civil Procedure. On September 10, 2015, the United States District Court for the Southern District of Florida issued an order (the “Order”) granting Plaintiff’s Unopposed Motion for Approval of Dismissal of Shareholder’s Derivative Claims and Class Action Claims. As contemplated in the Order, the Federal Court Complaint was dismissed with prejudice, and the case was closed on October 14, 2015. Other Litigation On April 10, 2015, a complaint was filed against the Company’s subsidiary in the Circuit Court of the Twentieth Judicial Circuit in and for St. Clair County, Illinois, styled Kenneth Jennings v. Washington Square Financial, LLC d/b/a Imperial Structured Settlements (“Washington Square”). The plaintiff seeks, in a purported class action, to represent all individuals who sold all or a part of a structured settlement annuity to Washington Square under the Illinois Structured Settlement Protections Act (the “Illinois Act”), where the underlying annuity contract contained an anti-assignment clause, and where a court issued an order under the Illinois Act approving the transaction. The complaint seeks, among other things, a declaration that all such transactions are void and compensatory and punitive damages. The Company has not established any provision for losses in respect of this matter. 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, 2015 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders’ Equity During the second quarter of 2015, the Company commenced a rights offering and distributed one non-transferable subscription right for every four shares of common stock owned by its shareholders of record at the close of business on May 26, 2015. Each right entitled its holder to subscribe for one share of common stock at a price of $5.75 per share. Additionally, the Company allocated an additional 1,337,686 shares to honor over-subscription requests. The rights offering was over-subscribed and the Company issued 6,688,433 shares of common stock. The Company has reserved an aggregate of 2,700,000 shares of common stock under its Omnibus Plan, of which 774,394 options to purchase shares of common stock granted to existing employees were outstanding as of September 30, 2015 , and 103,112 shares of restricted stock had been granted to directors under the plan with 41,259 shares subject to vesting. During 2014, upon receipt of shareholder approval, the Company reclassified the embedded derivative contained in its Convertible Notes to stockholders’ equity along with unamortized transaction costs proportionate to the allocation of the initial debt discount and the principal amount of the Convertible 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 December 31, 2014. See Note 11 , " 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 settlement of class litigation filing in connection with the USAO Investigation, 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 2014, the Company awarded 323,500 target performance shares for restricted common stock to its directors and certain employees, of which 150,000 shares were subject to shareholder approval of the Omnibus Plan, which was obtained at the Company’s 2015 annual meeting on May 28, 2015. 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 months and nine months periods ended September 30, 2015 . The performance shares will be subject to a one year vesting period from the date of issuance. Exclusive of the 323,500 target performance shares awarded to its directors, named executive officers and certain employees, there were 1,808,735 securities remaining for future issuance under the Omnibus Plan as of September 30, 2015 . 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 17 , " Income Taxes ." On September 1, 2015, the Company announced that its Board of Directors authorized a $10 million share and note repurchase program. The program has a two-year expiration date, and authorizes the Company to repurchase up to $10 million of its common stock and/or its Convertible Notes due 2019. For the quarter ended September 30, 2015 , the Company purchased 65,621 shares for a total cost of approximately $348,000 , which is an average cost of $5.30 per share including transaction fees. As of September 30, 2015 , the Company may purchase up to approximately $9.7 million of additional common stock or Convertible Notes under its board authorized plan. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company’s provision for income taxes from continuing operations is estimated to result in an annual effective tax rate of approximately 35.0% and 36.9% (before the third quarter 2015 establishment of a valuation allowance and before the 2014 adoption of ASU 2013-11, discussed below) during the nine month period ended September 30, 2015 and 2014 , respectively. The Company’s quarterly effective income tax rates are based upon the Company’s current estimated annual rate. The Company’s annual effective income tax rate varies based upon the Company’s taxable earnings as well as on a mix of taxable earnings in the various state and foreign jurisdictions. In the third quarter of 2015 , the Company established a valuation allowance of $2.0 million for certain state net deferred tax assets. This valuation allowance is needed as realization is not expected due to the anticipation that sufficient future taxable earnings may not be generated in the state jurisdictions in which the Company operates. The tax expense from the increase valuation allowance was offset by a $927,000 tax benefit for the impact on tax rate changes in the third quarter. The Company adopted ASU 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”) 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 included in the Company’s provision for income taxes for the three months ended March 31, 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 March 31, 2014. 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 15 regarding the IRS Investigation related to the Company’s former structured settlement business. The Company and its subsidiary companies 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. |
Principles of Consolidation a24
Principles of Consolidation and Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Derivative Instruments | Derivative Instrument In February 2014, the Company issued and sold $70.7 million in aggregate principal amount of 8.50% senior unsecured convertible notes due 2019 (the “Convertible Notes”). Prior to shareholder approval on June 5, 2014 to issue shares of common stock upon conversion of the Convertible Notes in excess of New York Stock Exchange limits for share issuances without shareholder approval, the Convertible 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 Convertible 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 Convertible Notes. The Convertible Notes are recorded at accreted value and will continue to be accreted up to the par value of the Convertible Notes at maturity. See Note 11 , " 8.50% Senior Unsecured Convertible Notes . |
Foreign Currency | Foreign Currency The Company owns certain foreign subsidiary companies formed under the laws of Ireland, Bahamas and Bermuda. These foreign subsidiary companies utilize the U.S. dollar as their functional currency. Any gains and losses resulting from foreign currency transactions (transactions denominated in a currency other than the subsidiary companies functional currency) are included in income. 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 life settlements, the valuation of the debt owing under the Revolving Credit Facilities, the valuation of equity awards and the valuation of the conversion derivative liability formerly embedded within the Company’s Convertible Notes. |
Consolidation of Variable Int25
Consolidation of Variable Interest Entities (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Consolidation of Variable Interest Entities | 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 financial statements as of September 30, 2015 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 Assets Maximum Exposure To Loss September 30, 2015 $ 464,032 $ 214,019 $ 2,384 $ 2,384 December 31, 2014 $ 314,062 $ 146,254 $ 2,384 $ 2,384 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Earnings Per Share [Abstract] | |
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, 2015 and 2014 (in thousands except share and per share data). For the Three Months Ended For the Nine Months Ended 2015(1) 2014(2) 2015(1) 2014(2) Income (loss) per share: Numerator: Net income (loss) from continuing operations $ (13,491 ) $ (4,264 ) $ (16,689 ) $ (13,863 ) Net income (loss) from discontinued operations $ (113 ) $ (249 ) $ (416 ) $ (454 ) Net income (loss) $ (13,604 ) $ (4,513 ) $ (17,105 ) $ (14,317 ) Basic and diluted income (loss) per common share: Basic and diluted income (loss) from continuing operations $ (0.48 ) $ (0.20 ) $ (0.70 ) $ (0.65 ) Basic and diluted income (loss) from discontinued operations $ — $ (0.01 ) $ (0.02 ) $ (0.02 ) Basic and diluted income (loss) per share available to common shareholders $ (0.48 ) $ (0.21 ) $ (0.72 ) $ (0.67 ) Denominator: Basic and diluted 28,084,254 21,361,930 23,827,030 21,352,086 (1) The computation of diluted EPS does not include 41,259 shares of restricted stock, 774,394 options, 6,240,521 warrants up to 10,738,165 shares of underlying common stock issuable upon conversion of the Convertible Notes and 323,500 performance shares, as the effect of their inclusion would have been anti-dilutive. (2) The computation of diluted EPS did not include 815,448 options, 6,240,521 warrants, 41,060 shares of restricted stock, up to 10,464,491 shares of underlying common stock issuable upon conversion of the Convertible 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. |
Stock-based Compensation (Table
Stock-based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
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, 2015 : Common Stock Options Number of Shares Weighted Average Price per Share Weighted Average Remaining Contractual Term Aggregate Intrinsic Value Options outstanding, January 1, 2015 807,949 $ 8.50 4.48 — Options granted — — Options exercised — — Options forfeited (33,555 ) $ 8.50 — — Options expired — — Options outstanding, September 30, 2015 774,394 $ 8.50 3.73 — Exercisable at September 30, 2015 774,394 $ 8.50 3.73 — Unvested at September 30, 2015 — — — — |
Activity of Unvested Shares of Restricted Stock | The following table presents the activity of the Company’s unvested shares of restricted stock for the nine months ended September 30, 2015 : Common Unvested Shares Number of Shares Outstanding January 1, 2015 41,060 Granted 41,259 Vested (41,060 ) Forfeited — Outstanding September 30, 2015 41,259 |
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, 2015 : Performance Shares Number of Shares Outstanding January 1, 2015 323,500 Awarded — Vested — Forfeited — Outstanding September 30, 2015 323,500 |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | |
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 2015 2014 2015 2014 Total income (loss) $ (13 ) $ 38 $ 60 $ 150 Total expenses (134 ) (287 ) (700 ) (604 ) Income (loss) before income taxes (147 ) (249 ) (640 ) (454 ) Income tax benefit 34 — 224 — Net income (loss) from discontinued operations $ (113 ) $ (249 ) $ (416 ) $ (454 ) |
Life Settlements (Life Insura29
Life Settlements (Life Insurance Policies) (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Investments, All Other Investments [Abstract] | |
Life Settlements | The following table describes the Company’s life settlements as of September 30, 2015 (dollars in thousands): Remaining Life Expectancy (In Years) Number of Life Settlement Contracts Estimated Fair Value Face Value 0 - 1 — $ — $ — 1 - 2 9 21,516 32,307 2 - 3 20 52,926 95,122 3 - 4 19 29,638 70,309 4 - 5 25 33,129 96,406 Thereafter 561 320,601 2,703,759 Total 634 $ 457,810 $ 2,997,903 The weighted average life expectancy calculated based on death benefit of insureds in the policies owned by the Company at December 31, 2014 was 10.7 years. The following table describes the Company’s life settlements as of December 31, 2014 (dollars in thousands): Remaining Life Expectancy (In Years) Number of Life Settlement Contracts Estimated Fair Value Face Value 0-1 — $ — $ — 1-2 4 9,227 12,728 2-3 10 23,202 45,852 3-4 16 29,531 67,735 4-5 19 23,012 65,614 Thereafter 558 303,914 2,739,137 Total 607 $ 388,886 $ 2,931,066 |
Estimated Premiums To Be Paid | Estimated premiums to be paid for each of the five succeeding fiscal years to keep the life insurance policies in force as of September 30, 2015 , are as follows (in thousands): Remainder of 2015 $ 16,292 2016 68,891 2017 75,602 2018 78,260 2019 85,030 Thereafter 1,110,449 $ 1,434,524 |
8.50% Senior Unsecured Conver30
8.50% Senior Unsecured Convertible Notes 8.50% Senior Unsecured Convertible Notes (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Debt Disclosure [Abstract] | |
Convertible Debt | 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 40.0 % Expected Term in Years 4.7 Risk Free Rate 1.5 % |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Assets And Liabilities Measured at Fair Value on Recurring Basis | The balances of the Company’s assets measured at fair value on a recurring basis as of September 30, 2015 , are as follows (in thousands): Level 1 Level 2 Level 3 Total Fair Value Assets: Life settlements $ — $ — $ 457,810 $ 457,810 $ — $ — $ 457,810 $ 457,810 The balances of the Company’s liabilities measured at fair value on a recurring basis as of September 30, 2015 are as follows (in thousands): Level 1 Level 2 Level 3 Total Fair Value Liabilities: White Eagle Revolving Credit Facility $ — $ — $ 157,946 $ 157,946 Red Falcon Revolving Credit Facility — — 55,685 55,685 $ — $ — $ 213,631 $ 213,631 The balances of the Company’s assets measured at fair value on a recurring basis as of December 31, 2014 , are as follows (in thousands): Level 1 Level 2 Level 3 Total Fair Value Assets: Life settlements $ — $ — $ 388,886 $ 388,886 Structured settlement receivables — — 384 384 $ — $ — $ 389,270 $ 389,270 The balances of the Company’s liabilities measured at fair value on a recurring basis as of December 31, 2014 , are as follows (in thousands): Level 1 Level 2 Level 3 Total Fair Value Liabilities: White Eagle Revolving Credit Facility $ — $ — $ 145,831 $ 145,831 $ — $ — $ 145,831 $ 145,831 |
Quantitative Information about Level 3 Fair Value Measurements | The Company values its 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 although the Company believes that this risk premium has been declining. ($ in thousands) Quantitative Information about Level 3 Fair Value Measurements Fair Value Aggregate Valuation Technique Unobservable Input (s) Range (Weighted Average) Non-premium financed $ 97,022 $ 343,803 Discounted cash flow Discount rate 15.00% - 21.00% Life expectancy evaluation (6.6 years) Premium financed $ 360,788 $ 2,654,100 Discounted cash flow Discount rate 16.00% - 24.75% Life expectancy evaluation (10.5 years) Life settlements $ 457,810 $ 2,997,903 Discounted cash flow Discount rate 17.00% Life expectancy evaluation (10.0 years) White Eagle Revolving Credit Facility $ 157,946 N/A Discounted cash flow Discount rate 23.55% Life expectancy evaluation (9.9 years) Red Falcon Revolving Credit Facility $ 55,685 N/A Discounted cash flow Discount Rate 11.18% Life expectancy evaluation (9.5 years) |
Changes in Estimated Fair Value, If All of Insured Lives in Company's Life Settlement Portfolio Live Six Months Shorter or Longer Than Life Expectancies Provided by Third Parties | 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 $ 384,990 $ (72,820 ) - $ 457,810 — -6 $ 536,666 $ 78,856 |
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 the Company’s life settlements as of September 30, 2015 : Carrier Percentage of Total Fair Value Percentage of Total Death Benefit Moody's Rating S&P Rating Transamerica Life Insurance Company 20.6 % 20.5 % A1 AA- Lincoln National Life Insurance Company 21.6 % 19.6 % A1 AA- |
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 nine months ended September 30, 2014 , for all assets for which the Company determines fair value using a material level of unobservable (Level 3) inputs, which consist solely of life settlements (in thousands): Life Settlements: Balance, January 1, 2014 $ 302,961 Purchase of policies 3,488 Change in fair value 19,313 Matured/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, 2015 , for all assets for which the Company determines fair value using a material level of unobservable (Level 3) inputs, which consists solely of life settlements (in thousands): Life Settlements: Balance, January 1, 2015 $ 388,886 Purchase of policies 30,534 Change in fair value 43,582 Matured/lapsed/sold policies (53,435 ) Premiums paid 48,243 Transfers into level 3 — Transfer out of level 3 — Balance, September 30, 2015 $ 457,810 Changes in fair value included in earnings for the period relating to assets held at September 30, 2015 $ 2,805 |
Changes in Fair Value for All Liabilities Using Material Level of Unobservable (Level 3) Inputs | The following table provides a roll-forward in the changes in fair value for nine months ended September 30, 2015 , for the White Eagle Revolving Credit Facility for which the Company determines fair value using a material level of unobservable (Level 3) inputs (in thousands): White Eagle Revolving Credit Facility: Balance, January 1, 2015 $ 145,831 Draws under the White Eagle Revolving Credit Facility 42,448 Payments on credit facility (43,241 ) Unrealized change in fair value 12,908 Transfers into level 3 — Transfer out of level 3 — Balance, September 30, 2015 $ 157,946 Changes in fair value included in earnings for the period relating to liabilities held at September 30, 2015 $ 12,908 The following table provides a roll-forward in the changes in fair value for nine months ended September 30, 2015 , for the Red Falcon Revolving Credit Facility for which the Company determines fair value using a material level of unobservable (Level 3) inputs (in thousands): Red Falcon Revolving Credit Facility: Balance, January 1, 2015 $ — Initial advance under the Red Falcon Revolving Credit Facility 54,000 Subsequent draws under the Red Falcon Revolving Credit Facility 2,967 Payments on Red Falcon Revolving Credit Facility (1,863 ) Unrealized change in fair value 581 Transfers into level 3 — Transfer out of level 3 — Balance, September 30, 2015 $ 55,685 Changes in fair value included in earnings for the period relating to liabilities held at September 30, 2015 $ 581 The following tables provide a roll-forward in the changes in fair value for the nine months ended September 30, 2014 , for the White Eagle Revolving Credit Facility and conversion derivative liability for which the Company determines fair value using a material level of unobservable (Level 3) inputs (in thousands): White Eagle Revolving Credit Facility: 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 $ — |
Market Approach Valuation Technique | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Market Interest Rate Sensitivity Analysis | Market interest rate sensitivity analysis Weighted Average Rate Calculated Based on Death Benefit Rate Adjustment Value Change in Value 16.50% -0.50% $ 469,610 $ 11,800 17.00% — $ 457,810 $ — 17.50% +0.50% $ 446,512 $ (11,298 ) |
Market Approach Valuation Technique | Revolving Credit Facility | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Changes in Estimated Fair Value, If All of Insured Lives in Company's Life Settlement Portfolio Live Six Months Shorter or Longer Than Life Expectancies Provided by Third Parties | If all of the insured lives in the life settlement portfolio pledged under the White Eagle Revolving Credit Facility live six months shorter or longer than the life expectancies used to calculate the estimated fair value of the White Eagle Revolving Credit Facility debt, the change in estimated fair value would be as follows (dollars in thousands): Life Expectancy Months Adjustment Fair Value of White Eagle Revolving Credit Facility Change in Value +6 $ 132,093 $ (25,853 ) $ 157,946 — -6 $ 182,793 $ 24,847 |
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 White Eagle Revolving Credit Facility as of September 30, 2015 would be as follows (dollars in thousands): Discount Rate Rate Adjustment Fair Value of White Eagle Revolving Credit Facility Change in Value 23.05% -0.50 % $ 160,730 $ 2,784 23.55% — $ 157,946 $ — 24.05% +0.50 % $ 155,255 $ (2,691 ) |
Red Falcon Trust | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Changes in Estimated Fair Value, If All of Insured Lives in Company's Life Settlement Portfolio Live Six Months Shorter or Longer Than Life Expectancies Provided by Third Parties | If all of the insured lives in the life settlement portfolio pledged under the Red Falcon Credit Facility live six months shorter or longer than the life expectancies used to calculate the estimated fair value of the Red Falcon Revolving Credit Facility, the change in estimated fair value would be as follows (dollars in thousands): Life Expectancy Months Adjustment Fair Value of Red Falcon Revolving Credit Facility Change in Value +6 $ 53,734 $ (1,951 ) $ 55,685 — -6 $ 57,236 $ 1,551 |
Red Falcon Trust | Market Approach Valuation Technique | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
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 Red Falcon Revolving Credit Facility as of September 30, 2015 would be as follows (dollars in thousands): Discount Rate Rate Adjustment Fair Value of Red Falcon Revolving Credit Facility Change in Value 10.68% -0.50 % $ 56,523 $ 838 11.18% — $ 55,685 $ — 11.68% +0.50 % $ 54,868 $ (817 ) |
Description of Business - Addit
Description of Business - Additional Information (Detail) | Sep. 30, 2015USD ($)Contract | Jul. 16, 2015USD ($)Contract | Dec. 31, 2014USD ($)Contract | Apr. 29, 2013USD ($) | |
Organization and Nature of Operations [Line Items] | |||||
Number of policies owned (contracts) | Contract | 634 | 607 | |||
Life insurance estimated fair value | $ 457,810,000 | $ 388,886,000 | |||
Life insurance policies with aggregate death benefit | 2,997,903,000 | 2,931,066,000 | |||
Secured Notes, net of discount (Note 12) | 0 | $ 24,036,000 | [1] | ||
White Eagle | Securities Pledged as Collateral | 12.875% Senior Secured Notes Due 2017 | |||||
Organization and Nature of Operations [Line Items] | |||||
Secured Notes, net of discount (Note 12) | 110,000,000 | ||||
White Eagle | Revolving Credit Facility | |||||
Organization and Nature of Operations [Line Items] | |||||
Revolving Credit facility, current borrowing capacity | $ 161,800,000 | $ 300,000,000 | |||
White Eagle | Revolving Credit Facility | Securities Pledged as Collateral | |||||
Organization and Nature of Operations [Line Items] | |||||
Number of policies owned (contracts) | Contract | 439 | ||||
Life insurance estimated fair value | $ 327,400,000 | ||||
Life insurance policies with aggregate death benefit | 2,200,000,000 | ||||
Revolving Credit facility, current borrowing capacity | $ 300,000,000 | $ 300,000,000 | |||
Red Falcon Trust | Securities Pledged as Collateral | |||||
Organization and Nature of Operations [Line Items] | |||||
Number of policies owned (contracts) | Contract | 157 | ||||
Life insurance estimated fair value | $ 117,400,000 | ||||
Life insurance policies with aggregate death benefit | 604,800,000 | ||||
Red Falcon Trust | Revolving Credit Facility | |||||
Organization and Nature of Operations [Line Items] | |||||
Number of policies owned (contracts) | Contract | 157 | ||||
Revolving Credit facility, current borrowing capacity | $ 55,200,000 | $ 110,000,000 | |||
Red Falcon Trust | Revolving Credit Facility | Securities Pledged as Collateral | |||||
Organization and Nature of Operations [Line Items] | |||||
Number of policies owned (contracts) | Contract | 157 | ||||
Life insurance estimated fair value | $ 117,400,000 | ||||
Life insurance policies with aggregate death benefit | $ 604,800,000 | ||||
[1] | Derived from audited consolidated financial statements. |
Principles of Consolidation a33
Principles of Consolidation and Basis of Presentation - Additional Information (Detail) $ in Thousands | Aug. 28, 2015USD ($) | Oct. 25, 2013USD ($) | Sep. 30, 2015USD ($)Contract | Jul. 16, 2015Contract | Dec. 31, 2014USD ($)Contract | Feb. 28, 2014USD ($) |
Organization and Nature of Operations [Line Items] | ||||||
Number of policies owned (contracts) | Contract | 634 | 607 | ||||
Life insurance policies with aggregate death benefit | $ 2,997,903 | $ 2,931,066 | ||||
Life insurance estimated fair value | $ 457,810 | $ 388,886 | ||||
Sale of structured settlement business | $ 920 | $ 12,000 | ||||
8.50% Senior Unsecured Convertible Notes Due 2019 | ||||||
Organization and Nature of Operations [Line Items] | ||||||
Debt instrument issued | $ 70,700 | |||||
Stated interest rate | 8.50% | |||||
White Eagle | Revolving Credit Facility | Securities Pledged as Collateral | ||||||
Organization and Nature of Operations [Line Items] | ||||||
Number of policies owned (contracts) | Contract | 439 | |||||
Life insurance policies with aggregate death benefit | $ 2,200,000 | |||||
Life insurance estimated fair value | $ 327,400 | |||||
Red Falcon Trust | Securities Pledged as Collateral | ||||||
Organization and Nature of Operations [Line Items] | ||||||
Number of policies owned (contracts) | Contract | 157 | |||||
Life insurance policies with aggregate death benefit | $ 604,800 | |||||
Life insurance estimated fair value | $ 117,400 | |||||
Red Falcon Trust | Revolving Credit Facility | ||||||
Organization and Nature of Operations [Line Items] | ||||||
Number of policies owned (contracts) | Contract | 157 | |||||
Red Falcon Trust | Revolving Credit Facility | Securities Pledged as Collateral | ||||||
Organization and Nature of Operations [Line Items] | ||||||
Number of policies owned (contracts) | Contract | 157 | |||||
Life insurance policies with aggregate death benefit | $ 604,800 | |||||
Life insurance estimated fair value | $ 117,400 |
Consolidation of Variable Int34
Consolidation of Variable Interest Entities Consolidation of Variable Interest Entities (Detail) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Primary Beneficiary Variable Interest Entity | ||
Variable Interest Entity [Line Items] | ||
Primary Beneficiary Consolidated VIEs, assets | $ 464,032 | $ 314,062 |
Primary Beneficiary Consolidated VIEs, liabilities | 214,019 | 146,254 |
Not Primary Beneficiary Variable Interest Entity | ||
Variable Interest Entity [Line Items] | ||
Variable Interest Entity, Nonconsolidated, Carrying Amount, Assets | 2,384 | 2,384 |
Not Primary Beneficiary Non-consolidated VIEs, Maximum Exposure to Loss | $ 2,384 | $ 2,384 |
Consolidation of Variable Int35
Consolidation of Variable Interest Entities - Additional Information (Detail) $ in Thousands | Sep. 30, 2015USD ($)Contract | Dec. 31, 2014USD ($)Contract |
Variable Interest Entity [Line Items] | ||
Number of policies owned (contracts) | Contract | 634 | 607 |
Life insurance policies with aggregate death benefit | $ 2,997,903 | $ 2,931,066 |
Life insurance estimated fair value | $ 457,810 | $ 388,886 |
White Eagle | Revolving Credit Facility | Securities Pledged as Collateral | ||
Variable Interest Entity [Line Items] | ||
Number of policies owned (contracts) | Contract | 439 | |
Life insurance policies with aggregate death benefit | $ 2,200,000 | |
Life insurance estimated fair value | $ 327,400 | |
Red Falcon | Revolving Credit Facility | Securities Pledged as Collateral | ||
Variable Interest Entity [Line Items] | ||
Number of policies owned (contracts) | Contract | 157 | |
Life insurance policies with aggregate death benefit | $ 604,800 | |
Life insurance estimated fair value | $ 117,400 |
Earnings Per Share - Additional
Earnings Per Share - Additional Information (Detail) - shares | Sep. 30, 2015 | Dec. 31, 2014 | Sep. 30, 2014 |
Earnings Per Share [Abstract] | |||
Common stock, shares outstanding (shares) | 28,130,508 | 21,402,990 | 21,402,990 |
Common stock, shares issued (shares) | 28,130,508 | 21,402,990 | 21,402,990 |
Earnings Per Share Earnings Per
Earnings Per Share Earnings Per Share - Reconciliation (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Numerator: | ||||
Net income (loss) from continuing operations | $ (13,491) | $ (4,264) | $ (16,689) | $ (13,863) |
Net income (loss) from discontinued operations | (113) | (249) | (416) | (454) |
Net income (loss) | $ (13,604) | $ (4,513) | $ (17,105) | $ (14,317) |
Basic and diluted income (loss) per common share: | ||||
Basic and diluted income (loss) from continuing operations (usd per share) | $ (0.48) | $ (0.20) | $ (0.70) | $ (0.65) |
Basic and diluted loss from discontinued operations (usd per share) | 0 | (0.01) | (0.02) | (0.02) |
Basic and diluted income (loss) per share available to common shareholders (usd per share) | $ (0.48) | $ (0.21) | $ (0.72) | $ (0.67) |
Denominator: | ||||
Basic and Diluted (shares) | 28,084,254 | 21,361,930 | 23,827,030 | 21,352,086 |
Earnings Per Share - Reconcilia
Earnings Per Share - Reconciliation Additional Information (Detail) - shares | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2014 | |
Restricted Stock | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of diluted earnings per share (shares) | 41,259 | 41,060 | 41,060 |
Stock Option | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of diluted earnings per share (shares) | 774,394 | 815,448 | 815,448 |
Warrant | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of diluted earnings per share (shares) | 6,240,521 | 6,240,521 | 6,240,521 |
Convertible Debt Securities | Maximum | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of diluted earnings per share (shares) | 10,738,165 | 10,464,491 | 10,464,491 |
Performance Shares | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of diluted earnings per share (shares) | 323,500 | 299,500 | 323,500 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Detail) - USD ($) | Feb. 11, 2011 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Options granted (shares) | 0 | |||||
Options granted strike price (usd per share) | ||||||
Stock-based compensation expense | $ 429,000 | $ 762,000 | ||||
Options outstanding and unexercised (shares) | 774,394 | 774,394 | 807,949 | |||
Options outstanding and unexercised, weighted average price (usd per share) | $ 8.50 | $ 8.50 | $ 8.50 | |||
Remaining unamortized amounts | $ 0 | $ 0 | ||||
Exercise price of warrants | $ 10.75 | $ 10.75 | ||||
Estimated Fair Value Of Warrants | $ 5,400,000 | $ 5,400,000 | ||||
Common stock warrants term | 5 years | |||||
Including Overallotment Option | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Exercise price of warrants | $ 14.51 | |||||
Warrant expiration period | 7 years | |||||
Warrants issued | 4,240,521 | 4,240,521 | ||||
Minimum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Average daily trading closing price | $ 8.50 | $ 8.50 | ||||
Average daily trading closing price, period | 45 days | |||||
Maximum | Including Overallotment Option | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Expected issuance of warrants for shares | 4,240,521 | |||||
Stock Option | Omnibus Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares of common stock reserved for future grant | 2,700,000 | 2,700,000 | ||||
Options outstanding and unexercised (shares) | 774,394 | 774,394 | ||||
Restricted Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock granted (shares) | 41,259 | |||||
Stock vested (shares) | 41,060 | |||||
Restricted stock, aggregate intrinsic value | $ 230,000 | $ 230,000 | ||||
Restricted Stock | Omnibus Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock-based compensation expense | $ 61,000 | $ 192,000 | $ 130,000 | |||
Options outstanding and unexercised, weighted average price (usd per share) | $ 8.50 | $ 8.50 | ||||
Stock vested (shares) | 41,060 | 17,286 | ||||
Fair value of stock vested | $ 120,000 | |||||
Fair value of stock granted | $ 255,000 | $ 255,000 | ||||
Stock vesting period | 1 year | |||||
Restricted stock, weighted average remaining life | 7 months 28 days | |||||
Restricted Stock | Omnibus Plan | Restricted Stock One | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock-based compensation expense | $ 0 | 52,000 | ||||
Restricted Stock | Omnibus Plan | Restricted Stock Two | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock-based compensation expense | $ 61,000 | 83,000 | ||||
Restricted Stock | Omnibus Plan | Directors | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock-based compensation expense | 0 | 61,000 | 108,000 | $ 78,000 | ||
Stock granted (shares) | 41,060 | |||||
Fair value of stock granted | 255,000 | 255,000 | ||||
Stock Options | Omnibus Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock-based compensation expense | $ 0 | $ 140,000 | $ 237,000 | $ 632,000 | ||
Performance Shares | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock granted (shares) | 0 | |||||
Stock vested (shares) | 0 | |||||
Performance Shares | Omnibus Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock granted (shares) | 323,500 | 323,500 | ||||
Stock granted, subject to shareholders' approval of an amended and restated of plan | 150,000 | 150,000 | ||||
Stock vesting period | 1 year | |||||
Performance Shares | Omnibus Plan | Minimum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Actual shares to be issued | 0.00% | 0.00% | ||||
Performance Shares | Omnibus Plan | Maximum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Actual shares to be issued | 150.00% | 150.00% | ||||
USAO Investigation | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Exercise price of warrants | $ 10.75 | $ 10.75 | ||||
Litigation Settlement, Shares to Escrow | 2,000,000 | |||||
Estimated Fair Value Of Warrants | $ 5,400,000 | $ 5,400,000 | ||||
Common stock warrants term | 5 years | |||||
USAO Investigation | Minimum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Average daily trading closing price | $ 8.50 | $ 8.50 | ||||
Average daily trading closing price, period | 45 days | |||||
Common Stock | Restricted Stock | Omnibus Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock granted (shares) | 41,259 |
Stock-based Compensation - Comm
Stock-based Compensation - Common Stock Options Activity (Detail) - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2015 | Dec. 31, 2014 | |
Number of Shares | ||
Options outstanding, Beginning Balance (shares) | 807,949 | |
Options granted (shares) | 0 | |
Options exercised (shares) | 0 | |
Options forfeited (shares) | (33,555) | |
Options expired (shares) | 0 | |
Options outstanding, Ending Balance (shares) | 774,394 | 807,949 |
Exercisable at end of period (shares) | 774,394 | |
Unvested at end of period (shares) | 0 | |
Weighted Average Price per Share | ||
Options outstanding, Beginning Balance (usd per share) | $ 8.50 | |
Options granted (usd per share) | ||
Options exercised (usd per share) | ||
Options forfeited (usd per share) | $ 8.50 | |
Options expired (usd per share) | ||
Options outstanding, Ending Balance (usd per share) | $ 8.50 | $ 8.50 |
Exercisable at end of period (usd per share) | 8.50 | |
Unvested at end of period (usd per share) | $ 0 | |
Weighted Average Remaining Contractual Term | ||
Options outstanding, Beginning Balance (shares) | 3 years 8 months 23 days | 4 years 5 months 23 days |
Exercisable at end of period (shares) | 3 years 8 months 23 days | |
Unvested at end of period (shares) | 0 years | |
Aggregate Intrinsic Value | ||
Options outstanding, Beginning Balance | $ 0 | |
Options granted | 0 | |
Options exercised | 0 | |
Options forfeited | 0 | |
Options expired | 0 | |
Options outstanding, Ending Balance | 0 | $ 0 |
Exercisable at end of period | 0 | |
Unvested at end of period | $ 0 |
Stock-based Compensation - Acti
Stock-based Compensation - Activity of Unvested Shares of Restricted Stock (Detail) - Restricted Stock | 9 Months Ended |
Sep. 30, 2015shares | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Common Unvested Shares outstanding, Beginning Balance (shares) | 41,060 |
Granted (shares) | 41,259 |
Vested (shares) | (41,060) |
Forfeited (shares) | 0 |
Common Unvested Shares outstanding, Ending Balance (shares) | 41,259 |
Stock-based Compensation - Ac42
Stock-based Compensation - Activity of Performance Share Awards (Detail) - Performance Shares | 9 Months Ended |
Sep. 30, 2015shares | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Common Unvested Shares outstanding, Beginning Balance (shares) | 323,500 |
Awarded (shares) | 0 |
Vested (shares) | 0 |
Forfeited (shares) | 0 |
Common Unvested Shares outstanding, Ending Balance (shares) | 323,500 |
Discontinued Operations - Addit
Discontinued Operations - Additional Information (Detail) - USD ($) $ in Thousands | Aug. 28, 2015 | Oct. 25, 2013 | Dec. 31, 2013 | Sep. 30, 2015 | Sep. 30, 2014 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Loss on sale of structured settlements | $ 32 | $ 0 | |||
Sale of structured settlement business | $ 920 | $ 12,000 | |||
Structured settlements | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Sale of structured settlement business | $ 12,000 | ||||
Loss on sale of structured settlements | $ 11,300 |
Discontinued Operations - Opera
Discontinued Operations - Operating Results of Structured Settlement Business (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Discontinued Operations and Disposal Groups [Abstract] | ||||
Total income (loss) | $ (13) | $ 38 | $ 60 | $ 150 |
Total expenses | (134) | (287) | (700) | (604) |
Income (loss) before income taxes | (147) | (249) | (640) | (454) |
Income tax benefit | 34 | 0 | 224 | 0 |
Net income (loss) from discontinued operations | $ (113) | $ (249) | $ (416) | $ (454) |
Life Settlements (Life Insura45
Life Settlements (Life Insurance Policies) - Additional Information (Detail) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015USD ($)Contract | Dec. 31, 2014USD ($)Contract | |
Investments, All Other Investments [Abstract] | ||
Number of policies owned (contracts) | Contract | 634 | 607 |
Life insurance estimated fair value | $ 457,810 | $ 388,886 |
Average life expectancy of insured | 10 years | |
Estimated future premium payments | $ 1,434,524 |
Life Settlements (Life Insura46
Life Settlements (Life Insurance Policies) (Detail) $ in Thousands | Sep. 30, 2015USD ($)Contract | Dec. 31, 2014USD ($)Contract |
Number of Life Settlement Contracts | ||
0-1 | Contract | 0 | 0 |
1-2 | Contract | 9 | 4 |
2-3 | Contract | 20 | 10 |
3-4 | Contract | 19 | 16 |
4-5 | Contract | 25 | 19 |
Thereafter | Contract | 561 | 558 |
Total | Contract | 634 | 607 |
Estimated Fair Value | ||
0-1 | $ 0 | $ 0 |
1-2 | 21,516 | 9,227 |
2-3 | 52,926 | 23,202 |
3-4 | 29,638 | 29,531 |
4-5 | 33,129 | 23,012 |
Thereafter | 320,601 | 303,914 |
Total | 457,810 | 388,886 |
Face Value | ||
0-1 | 0 | 0 |
1-2 | 32,307 | 12,728 |
2-3 | 95,122 | 45,852 |
3-4 | 70,309 | 67,735 |
4-5 | 96,406 | 65,614 |
Thereafter | 2,703,759 | 2,739,137 |
Total | $ 2,997,903 | $ 2,931,066 |
Life Settlements (Life Insura47
Life Settlements (Life Insurance Policies) - Estimated Premiums to be Paid (Detail) $ in Thousands | Sep. 30, 2015USD ($) |
Investments, All Other Investments [Abstract] | |
Remainder of 2015 | $ 16,292 |
2,016 | 68,891 |
2,017 | 75,602 |
2,018 | 78,260 |
2,019 | 85,030 |
Thereafter | 1,110,449 |
Estimated future premium payments | $ 1,434,524 |
White Eagle Revolving Credit 48
White Eagle Revolving Credit Facility - Additional Information (Detail) | Apr. 29, 2013USD ($) | Sep. 30, 2015USD ($)Contract | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)Contract | Sep. 30, 2014USD ($) | Jun. 30, 2015USD ($) | Dec. 31, 2014USD ($)Contract |
Debt Instrument [Line Items] | |||||||
Number of policies owned (contracts) | Contract | 634 | 634 | 607 | ||||
Life insurance policies with aggregate death benefit | $ 2,997,903,000 | $ 2,997,903,000 | $ 2,931,066,000 | ||||
Life insurance estimated fair value | 457,810,000 | 457,810,000 | 388,886,000 | ||||
Interest expense on the facility | 8,614,000 | $ 4,303,000 | 21,491,000 | $ 11,165,000 | |||
Interest expense withheld from borrowings by lender | 5,566,000 | 4,962,000 | |||||
Interest paid | 12,143,000 | 4,496,000 | |||||
Revolving Credit Facility debt, at estimated fair value | $ 145,831,000 | ||||||
Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Revolving Credit Facility debt, at estimated fair value | 157,946,000 | 157,946,000 | $ 157,946,000 | ||||
White Eagle Asset Portfolio, LLC | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Proceeds to be paid to White Eagle after payment of loan | $ 76,100,000 | ||||||
Percentage of remaining proceeds | 50.00% | ||||||
White Eagle | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Revolving credit facility effective date | Apr. 29, 2013 | ||||||
Revolving credit facility period | 15 years | ||||||
Revolving Credit facility, current borrowing capacity | $ 300,000,000 | 161,800,000 | $ 161,800,000 | ||||
Line of credit facility, maximum borrowing capacity | 140,100,000 | 140,100,000 | |||||
Line of credit facility, remaining borrowing capacity | $ 1,900,000 | $ 1,900,000 | |||||
Collateral pledge percentage for distributions to be altered | 25.00% | 25.00% | |||||
Base rate | 0.50% | 0.50% | |||||
Debt instrument effective rate | 5.50% | 5.50% | |||||
Interest expense on the facility | $ 2,300,000 | 2,100,000 | $ 6,900,000 | 5,800,000 | |||
Interest expense withheld from borrowings by lender | 1,700,000 | 1,500,000 | 5,000,000 | 4,200,000 | |||
Interest paid | 634,000 | $ 573,000 | $ 1,900,000 | $ 1,600,000 | |||
Credit agreement expiration date | Apr. 28, 2028 | ||||||
Revolving Credit Facility debt, at estimated fair value | 157,900,000 | $ 157,900,000 | |||||
Revolving Credit Facility debt, outstanding | $ 159,900,000 | $ 159,900,000 | |||||
White Eagle | Revolving Credit Facility | Maintenance Costs | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit borrowing base percentage | 100.00% | 100.00% | |||||
White Eagle | Revolving Credit Facility | Accrued and Unpaid Interest | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit borrowing base percentage | 100.00% | 100.00% | |||||
Proceeds directed to pay outstanding interest and principal on loan | 100.00% | ||||||
White Eagle | Revolving Credit Facility | Other Fees and Expense [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit borrowing base percentage | 100.00% | 100.00% | |||||
White Eagle | Revolving Credit Facility | Policies pledged as collateral as determined by the lenders | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit borrowing base percentage | 75.00% | 75.00% | |||||
White Eagle | Revolving Credit Facility | Policies pledged as collateral excluding certain specified life insurance policies | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit borrowing base percentage | 50.00% | 50.00% | |||||
White Eagle | Revolving Credit Facility | Securities Pledged as Collateral | |||||||
Debt Instrument [Line Items] | |||||||
Revolving Credit facility, current borrowing capacity | $ 300,000,000 | $ 300,000,000 | $ 300,000,000 | ||||
Number of policies owned (contracts) | Contract | 439 | 439 | |||||
Life insurance policies with aggregate death benefit | $ 2,200,000,000 | $ 2,200,000,000 | |||||
Life insurance estimated fair value | $ 327,400,000 | $ 327,400,000 | |||||
White Eagle | Revolving Credit Facility | Floor Rate | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate | 1.50% | ||||||
White Eagle | Revolving Credit Facility | Applicable Margin | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate | 4.00% | ||||||
White Eagle | Revolving Credit Facility | Federal Funds Rate | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate | 0.75% | ||||||
White Eagle | White Eagle Asset Portfolio, LLC | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Proceeds to be paid to White Eagle after payment of loan | $ 76,100,000 | ||||||
Percentage of remaining proceeds | 50.00% |
Red Falcon Revolving Credit F49
Red Falcon Revolving Credit Facility (Details) | Jul. 16, 2015USD ($)Contract | Sep. 30, 2015USD ($)Contract | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)Contract | Sep. 30, 2014USD ($) | Jun. 30, 2015USD ($) | Dec. 31, 2014USD ($)Contract |
Debt Instrument [Line Items] | |||||||
Number of policies owned (contracts) | Contract | 634 | 634 | 607 | ||||
Life insurance policies with aggregate death benefit | $ 2,997,903,000 | $ 2,997,903,000 | $ 2,931,066,000 | ||||
Life insurance estimated fair value | 457,810,000 | 457,810,000 | 388,886,000 | ||||
Interest expense | 8,614,000 | $ 4,303,000 | 21,491,000 | $ 11,165,000 | |||
Interest payment and fees withheld from borrowings by lender | 5,566,000 | 4,962,000 | |||||
Cash paid for interest during the period | 12,143,000 | 4,496,000 | |||||
Revolving Credit Facility debt, at estimated fair value | $ 145,831,000 | ||||||
Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Borrowings from revolving credit facility | 36,880,000 | 36,004,000 | |||||
Revolving Credit Facility debt, at estimated fair value | 157,946,000 | 157,946,000 | $ 157,946,000 | ||||
Red Falcon Trust | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Revolving credit facility effective date | Jul. 16, 2015 | ||||||
Number of policies owned (contracts) | Contract | 157 | ||||||
Revolving Credit facility, current borrowing capacity | $ 110,000,000 | 55,200,000 | 55,200,000 | ||||
Line of credit facility, maximum borrowing capacity | 54,900,000 | 54,900,000 | |||||
Line of credit facility, remaining borrowing capacity | 110,000 | $ 110,000 | |||||
Line of credit, amortization percentage | 8.00% | 8.00% | |||||
Borrowings from revolving credit facility | $ 54,000,000 | $ 2,967,000 | $ 0 | ||||
Basis spread on variable rate | 0.50% | ||||||
Effective interest rate | 5.50% | ||||||
Interest expense | 3,800,000 | ||||||
Interest payment and fees withheld from borrowings by lender | 3,200,000 | ||||||
Cash paid for interest during the period | 601,000 | ||||||
Revolving Credit Facility debt, at estimated fair value | 55,700,000 | $ 55,700,000 | |||||
Revolving Credit Facility debt, outstanding | $ 55,100,000 | $ 55,100,000 | |||||
Yield maintenance provision. | 5.00% | 5.00% | |||||
Red Falcon Trust | Revolving Credit Facility | Applicable Margin | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate | 4.50% | ||||||
Red Falcon Trust | Revolving Credit Facility | Floor Rate | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate | 1.00% | ||||||
Red Falcon Trust | Revolving Credit Facility | Federal Funds Rate | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate | 0.75% | ||||||
Red Falcon Trust | Maintenance Costs | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit borrowing base percentage | 100.00% | ||||||
Red Falcon Trust | Policies pledged as collateral as determined by the lenders | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit borrowing base percentage | 60.00% | ||||||
Red Falcon Trust | Policies pledged as collateral excluding certain specified life insurance policies | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit borrowing base percentage | 45.00% | ||||||
Life insurance issuer concentrations that exceed 10% of total death benefit | Red Falcon Trust | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit, percentage of remaining outstanding balance | 65.00% | 65.00% | |||||
Scenario 3 | Red Falcon Trust | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit, percentage of remaining outstanding balance | 35.00% | 35.00% | |||||
Minimum | 10% of total fair value of our investments in life settlements | Red Falcon Trust | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit, loan to value ratio | 50.00% | 50.00% | |||||
Minimum | Life insurance issuer concentrations that exceed 10% of total death benefit | Red Falcon Trust | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit, loan to value ratio | 25.00% | 25.00% | |||||
Maximum | Life insurance issuer concentrations that exceed 10% of total death benefit | Red Falcon Trust | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit, loan to value ratio | 50.00% | 50.00% | |||||
Maximum | Scenario 3 | Red Falcon Trust | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit, loan to value ratio | 25.00% | 25.00% | |||||
Securities Pledged as Collateral | Red Falcon Trust | |||||||
Debt Instrument [Line Items] | |||||||
Number of policies owned (contracts) | Contract | 157 | 157 | |||||
Life insurance policies with aggregate death benefit | $ 604,800,000 | $ 604,800,000 | |||||
Life insurance estimated fair value | $ 117,400,000 | $ 117,400,000 | |||||
Securities Pledged as Collateral | Red Falcon Trust | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Number of policies owned (contracts) | Contract | 157 | 157 | |||||
Life insurance policies with aggregate death benefit | $ 604,800,000 | $ 604,800,000 | |||||
Life insurance estimated fair value | $ 117,400,000 | $ 117,400,000 |
8.50% Senior Unsecured Conver50
8.50% Senior Unsecured Convertible Notes - Additional Information (Detail) | Jul. 16, 2015USD ($) | Jun. 05, 2014USD ($) | Feb. 21, 2014 | Feb. 28, 2014USD ($)dDirector$ / shares | Sep. 30, 2015USD ($) | Jun. 30, 2015$ / sharesshares | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Dec. 31, 2014USD ($) | [1] |
Debt Instrument [Line Items] | |||||||||||
Common stock issued for rights offering, net of costs | shares | 6,688,433 | ||||||||||
Fair Value Assumptions and Methodology for Assets and Liabilities [Abstract] | |||||||||||
Expected Volatility | 40.00% | ||||||||||
Convertible Notes, net of discount (Note 11) | $ 57,867,000 | $ 57,867,000 | $ 55,881,000 | ||||||||
Debt instrument origination cost | 1,907,000 | 1,907,000 | $ 3,936,000 | ||||||||
Interest | $ 5,200,000 | ||||||||||
Amortizing debt discounts | 1,700,000 | ||||||||||
Debt issuance cost | $ 1,700,000 | ||||||||||
Change in fair value of conversion derivative liability | 0 | $ 0 | $ 0 | $ 6,759,000 | |||||||
8.50% Senior Unsecured Convertible Notes Due 2019 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt instrument issued | $ 70,700,000 | ||||||||||
Stated interest rate | 8.50% | ||||||||||
Debt instrument, due date | 2,019 | ||||||||||
Debt instrument, issuance date | Feb. 21, 2014 | ||||||||||
Number of board of directors | Director | 2 | ||||||||||
Debt instrument, maturity date | Feb. 15, 2019 | ||||||||||
Debt instrument, frequency of periodic payment | semi-annually in arrears on August 15 and February 15 of each year | ||||||||||
Debt instrument, convertible, conversion rate | 147.9290 | 151.7912 | |||||||||
Debt Instrument, Convertible, Conversion Price | $ / shares | $ 6.76 | $ 6.59 | |||||||||
Common stock issued for rights offering, net of costs | shares | 6,688,433 | ||||||||||
Debt instrument, redemption start date | Feb. 15, 2017 | ||||||||||
Debt instrument, convertible, minimum percentage of common stock price | 130.00% | ||||||||||
Debt instrument, convertible, threshold trading days | d | 20 | ||||||||||
Debt instrument, convertible, threshold consecutive trading days | 30 days | ||||||||||
Debt instrument, redemption price, percentage | 100.00% | ||||||||||
Fair Value Assumptions and Methodology for Assets and Liabilities [Abstract] | |||||||||||
Conversion derivative liability, at estimated fair value | $ 23,700,000 | ||||||||||
Convertible Notes, net of discount (Note 11) | 57,900,000 | $ 57,900,000 | |||||||||
Unamortized debt discount | 12,800,000 | 12,800,000 | |||||||||
Debt instrument origination cost | 1,900,000 | 1,900,000 | |||||||||
Interest expense of notes | 2,300,000 | 2,200,000 | 6,800,000 | $ 5,300,000 | |||||||
Interest | 1,500,000 | 1,500,000 | 4,500,000 | 3,700,000 | |||||||
Amortizing debt discounts | 711,000 | 605,000 | 2,000,000 | 1,400,000 | |||||||
Debt issuance cost | $ 105,000 | $ 90,000 | $ 294,000 | 239,000 | |||||||
Change in fair value of conversion derivative liability | $ 6,800,000 | ||||||||||
8.50% Senior Unsecured Convertible Notes Due 2019 | Reclassifications to Additional Paid in Capital | |||||||||||
Fair Value Assumptions and Methodology for Assets and Liabilities [Abstract] | |||||||||||
Unamortized transaction costs | 756,000 | ||||||||||
Deferred tax asset, conversion derivative liability | $ 8,800,000 | ||||||||||
8.50% Senior Unsecured Convertible Notes Due 2019 | Bulldog Investors Llc | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt instrument issued | $ 9,200,000 | ||||||||||
Conversion derivative liability | 8.50% Senior Unsecured Convertible Notes Due 2019 | |||||||||||
Fair Value Assumptions and Methodology for Assets and Liabilities [Abstract] | |||||||||||
Expected Term in Years | 4 years 8 months 12 days | ||||||||||
Risk Free Rate | 1.50% | ||||||||||
[1] | Derived from audited consolidated financial statements. |
12.875% Senior Secured Notes -
12.875% Senior Secured Notes - Additional Information (Detail) | Jul. 16, 2015USD ($)Contract | Jan. 21, 2015USD ($) | Nov. 10, 2014USD ($) | Sep. 30, 2015USD ($)Contract | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)Contract | Sep. 30, 2014USD ($) | Dec. 31, 2014Contract |
Debt Instrument [Line Items] | ||||||||
Extinguishment of Secured Notes | $ 8,800,000 | $ 8,782,000 | $ 0 | $ 8,782,000 | $ 0 | |||
Number of policies owned (contracts) | Contract | 634 | 634 | 607 | |||||
Interest | 5,200,000 | |||||||
Unused fees of debt | 171,000 | |||||||
Amortizing debt discounts | 1,700,000 | |||||||
Debt issuance cost | $ 1,700,000 | |||||||
12.875% Senior Secured Notes Due 2017 | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, maturity date | Nov. 10, 2017 | |||||||
Percentage of first tier foreign subsidiaries equity interests pledge to secure debt | 65.00% | |||||||
Debt instrument, redemption price, percentage | 106.00% | |||||||
Number of policies owned (contracts) | Contract | 159 | |||||||
Interest expense | $ 4,000,000 | |||||||
Interest | 3,200,000 | |||||||
Unused fees of debt | 265,000 | |||||||
Amortizing debt discounts | 264,000 | |||||||
Debt issuance cost | $ 277,000 | |||||||
12.875% Senior Secured Notes Due 2017 | Indaba Capital Management Lp | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 25,000,000 | $ 25,000,000 | ||||||
Secured notes issuance price as percentage of face amount | 96.00% | 96.00% | ||||||
Payments of debt issuance costs | $ 305,000 | $ 1,800,000 | ||||||
12.875% Senior Secured Notes Due 2017 | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 100,000,000 | |||||||
12.875% Senior Secured Notes Due 2017 | Securities Pledged as Collateral | ||||||||
Debt Instrument [Line Items] | ||||||||
Stated interest rate | 12.875% | 12.875% |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Detail) $ in Thousands | Jul. 16, 2015Contract | Sep. 30, 2015USD ($)Contractpolicycarrier | Jun. 30, 2015USD ($) | Dec. 31, 2014USD ($)Contract | |
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Mortality rate | 100.00% | ||||
Number of life insurance policies (contracts) | Contract | 634 | 607 | |||
Life insurance estimated fair value | $ 457,810 | $ 388,886 | |||
Weighted average discount rate | 17.00% | ||||
Settlements with estimated fair value | $ 0 | 384 | [1] | ||
Revolving Credit Facility debt, at estimated fair value | $ 145,831 | ||||
Red Falcon Trust | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Life insurance estimated fair value | $ 55,685 | ||||
Discount rates | 11.18% | ||||
Revolving Credit Facility debt, at estimated fair value | $ 55,685 | ||||
Securities Pledged as Collateral | Red Falcon Trust | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Number of life insurance policies (contracts) | Contract | 157 | ||||
Life insurance estimated fair value | $ 117,400 | ||||
Noninvestment grade | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Number of non-investment grate life insurance polices issued | policy | 18 | ||||
Number of carriers related to non-investment grade policies | carrier | 2 | ||||
Additional basis point risk premium | 3.00% | ||||
Premium Financed | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Number of life insurance policies (contracts) | Contract | 547 | ||||
Premium Financed | Minimum | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Discount rates | 16.00% | ||||
Premium Financed | Maximum | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Discount rates | 24.75% | ||||
Non Premium Financed | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Number of life insurance policies (contracts) | Contract | 87 | ||||
Non Premium Financed | Minimum | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Discount rates | 15.00% | ||||
Non Premium Financed | Maximum | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Discount rates | 21.00% | ||||
Impaired life bearing | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Mortality rate | 200.00% | ||||
Revolving Credit Facility | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Revolving Credit Facility debt, at estimated fair value | $ 157,946 | $ 157,946 | |||
Revolving Credit Facility | Red Falcon Trust | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Number of life insurance policies (contracts) | Contract | 157 | ||||
Revolving Credit Facility debt, at estimated fair value | 55,700 | ||||
Revolving Credit Facility debt, outstanding | $ 55,100 | ||||
Yield maintenance provision. | 5.00% | 5.00% | |||
Line of credit, amortization percentage | 8.00% | 8.00% | |||
Revolving Credit Facility | White Eagle Asset Portfolio, LLC | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Percentage of remaining proceeds | 50.00% | ||||
Proceeds to be paid to White Eagle after payment of loan | $ 76,100 | ||||
Revolving Credit Facility | Securities Pledged as Collateral | Red Falcon Trust | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Number of life insurance policies (contracts) | Contract | 157 | ||||
Life insurance estimated fair value | $ 117,400 | ||||
Scenario 3 | Revolving Credit Facility | Red Falcon Trust | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Line of credit, percentage of remaining outstanding balance | 35.00% | 35.00% | |||
Scenario 3 | Revolving Credit Facility | Red Falcon Trust | Maximum | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Line of credit, loan to value ratio | 25.00% | 25.00% | |||
Life insurance issuer concentrations that exceed 10% of total death benefit | Revolving Credit Facility | Red Falcon Trust | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Line of credit, percentage of remaining outstanding balance | 65.00% | 65.00% | |||
Life insurance issuer concentrations that exceed 10% of total death benefit | Revolving Credit Facility | Red Falcon Trust | Minimum | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Line of credit, loan to value ratio | 25.00% | 25.00% | |||
Life insurance issuer concentrations that exceed 10% of total death benefit | Revolving Credit Facility | Red Falcon Trust | Maximum | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Line of credit, loan to value ratio | 50.00% | 50.00% | |||
10% of total fair value of our investments in life settlements | Revolving Credit Facility | Red Falcon Trust | Minimum | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Line of credit, loan to value ratio | 50.00% | 50.00% | |||
White Eagle | Revolving Credit Facility | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Revolving Credit Facility debt, at estimated fair value | $ 157,900 | ||||
Revolving Credit Facility debt, outstanding | $ 159,900 | ||||
White Eagle | Revolving Credit Facility | White Eagle Asset Portfolio, LLC | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Percentage of remaining proceeds | 50.00% | ||||
Proceeds to be paid to White Eagle after payment of loan | $ 76,100 | ||||
White Eagle | Revolving Credit Facility | Securities Pledged as Collateral | |||||
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Number of life insurance policies (contracts) | Contract | 439 | ||||
Life insurance estimated fair value | $ 327,400 | ||||
[1] | Derived from audited consolidated financial statements. |
Fair Value Measurements - Asset
Fair Value Measurements - Assets And Liabilities Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Life settlements | $ 457,810 | $ 388,886 | |
Structured settlement receivables | 0 | 384 | [1] |
Total assets | 457,810 | 389,270 | |
Revolving Credit Facility debt, at estimated fair value | 145,831 | ||
Total Liabilities | 213,631 | 145,831 | |
Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Life settlements | 0 | 0 | |
Structured settlement receivables | 0 | ||
Total assets | 0 | 0 | |
Revolving Credit Facility debt, at estimated fair value | 0 | ||
Total Liabilities | 0 | 0 | |
Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Life settlements | 0 | 0 | |
Structured settlement receivables | 0 | ||
Total assets | 0 | 0 | |
Revolving Credit Facility debt, at estimated fair value | 0 | ||
Total Liabilities | 0 | 0 | |
Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Life settlements | 457,810 | 388,886 | |
Structured settlement receivables | 384 | ||
Total assets | 457,810 | 389,270 | |
Revolving Credit Facility debt, at estimated fair value | 145,831 | ||
Total Liabilities | 213,631 | $ 145,831 | |
White Eagle Revolving Credit Facility | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Revolving Credit Facility debt, at estimated fair value | 157,946 | ||
White Eagle Revolving Credit Facility | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Revolving Credit Facility debt, at estimated fair value | 0 | ||
White Eagle Revolving Credit Facility | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Revolving Credit Facility debt, at estimated fair value | 0 | ||
White Eagle Revolving Credit Facility | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Revolving Credit Facility debt, at estimated fair value | 157,946 | ||
Red Falcon Revolving Credit Facility | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Revolving Credit Facility debt, at estimated fair value | 55,685 | ||
Red Falcon Revolving Credit Facility | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Revolving Credit Facility debt, at estimated fair value | 0 | ||
Red Falcon Revolving Credit Facility | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Revolving Credit Facility debt, at estimated fair value | 0 | ||
Red Falcon Revolving Credit Facility | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Revolving Credit Facility debt, at estimated fair value | $ 55,685 | ||
[1] | Derived from audited consolidated financial statements. |
Fair Value Measurements - Quant
Fair Value Measurements - Quantitative Information about Level 3 Fair Value Measurements (Detail) - USD ($) $ in Thousands | 9 Months Ended | |||
Sep. 30, 2015 | Jun. 30, 2015 | Dec. 31, 2014 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Life settlements | $ 457,810 | $ 388,886 | ||
Structured settlement receivables | 0 | 384 | [1] | |
Revolving Credit Facility debt | 145,831 | |||
Life settlements | $ 2,997,903 | 2,931,066 | ||
Weighted average discount rate | 17.00% | |||
Revolving Credit Facility | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Revolving Credit Facility debt | $ 157,946 | $ 157,946 | ||
Minimum | Non Premium Financed | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Discount Rate | 15.00% | |||
Minimum | Premium Financed | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Discount Rate | 16.00% | |||
Maximum | Non Premium Financed | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Discount Rate | 21.00% | |||
Maximum | Premium Financed | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Discount Rate | 24.75% | |||
Level 3 | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Life settlements | $ 457,810 | 388,886 | ||
Structured settlement receivables | 384 | |||
Revolving Credit Facility debt | $ 145,831 | |||
Level 3 | Life Finance | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Life settlements | 457,810 | |||
Life settlements | $ 2,997,903 | |||
Valuation Technique | Discounted cash flow | |||
Weighted average life expectancy valuation period | 10 years | |||
Weighted average discount rate | 17.00% | |||
Level 3 | Life Finance | Non Premium Financed | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Life settlements | $ 97,022 | |||
Life settlements | $ 343,803 | |||
Valuation Technique | Discounted cash flow | |||
Weighted average life expectancy valuation period | 6 years 7 months 6 days | |||
Level 3 | Life Finance | Premium Financed | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Life settlements | $ 360,788 | |||
Life settlements | $ 2,654,100 | |||
Valuation Technique | Discounted cash flow | |||
Weighted average life expectancy valuation period | 10 years 6 months | |||
Level 3 | Minimum | Life Finance | Non Premium Financed | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Discount Rate | 15.00% | |||
Level 3 | Minimum | Life Finance | Premium Financed | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Discount Rate | 16.00% | |||
Level 3 | Maximum | Life Finance | Non Premium Financed | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Discount Rate | 21.00% | |||
Level 3 | Maximum | Life Finance | Premium Financed | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Discount Rate | 24.75% | |||
Red Falcon | Level 3 | Revolving Credit Facility | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Revolving Credit Facility debt | $ 55,685 | |||
Valuation Technique | Discounted cash flow | |||
Weighted average life expectancy valuation period | 9 years 6 months | |||
Discount Rate | 11.18% | |||
White Eagle | Revolving Credit Facility | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Revolving Credit Facility debt | $ 157,900 | |||
White Eagle | Level 3 | Revolving Credit Facility | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Revolving Credit Facility debt | $ 157,946 | |||
Valuation Technique | Discounted cash flow | |||
Weighted average life expectancy valuation period | 9 years 10 months 24 days | |||
Discount Rate | 23.55% | |||
White Eagle | Level 3 | Revolving Credit Facility | Structured settlements | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Weighted average discount rate | 23.55% | |||
[1] | Derived from audited consolidated financial statements. |
Fair Value Measurements - Chang
Fair Value Measurements - Changes in Life Expectancy Used to Estimate Fair Value (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Value | $ 457,810 | $ 457,810 | $ 388,886 | ||
Change in Value | 0 | $ 0 | 0 | $ (426) | |
+6 Life Expectancy Months Adjustment | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Value | 384,990 | 384,990 | |||
Change in Value | (72,820) | ||||
-6 Life Expectancy Months Adjustment | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Value | 536,666 | 536,666 | |||
Change in Value | 78,856 | ||||
Red Falcon Trust | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Value | 55,685 | 55,685 | |||
Change in Value | 0 | ||||
Red Falcon Trust | +6 Life Expectancy Months Adjustment | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Value | 53,734 | 53,734 | |||
Change in Value | (1,951) | ||||
Red Falcon Trust | -6 Life Expectancy Months Adjustment | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Value | $ 57,236 | 57,236 | |||
Change in Value | $ 1,551 |
Fair Value Measurements - Life
Fair Value Measurements - Life Insurance Issuer concentrations (Detail) - Credit Concentration Risk [Member] - Moody's, A1 Rating - Standard & Poor's, AA- Rating | 9 Months Ended |
Sep. 30, 2015 | |
Lincoln National Life Insurance Company | 10% of total fair value of our investments in life settlements | |
Concentration Risk [Line Items] | |
Concentrations risk percentage | 20.60% |
Lincoln National Life Insurance Company | Life insurance issuer concentrations that exceed 10% of total death benefit | |
Concentration Risk [Line Items] | |
Concentrations risk percentage | 20.50% |
Transamerica Occidental Life Insurance Company | 10% of total fair value of our investments in life settlements | |
Concentration Risk [Line Items] | |
Concentrations risk percentage | 21.60% |
Transamerica Occidental Life Insurance Company | Life insurance issuer concentrations that exceed 10% of total death benefit | |
Concentration Risk [Line Items] | |
Concentrations risk percentage | 19.60% |
Fair Value Measurements - Cha57
Fair Value Measurements - Changes in Weighted Average Discount Rate Used to Estimate Fair Value (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Weighted Average Rate | 17.00% | ||||
Value | $ 457,810 | $ 457,810 | $ 388,886 | ||
Change in Value | 0 | $ 0 | $ 0 | $ (426) | |
.50% Decrease in Discount Rate | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Weighted Average Rate | 16.50% | ||||
Value | 469,610 | $ 469,610 | |||
Change in Value | $ 11,800 | ||||
.50% Increase in Discount Rate | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Weighted Average Rate | 17.50% | ||||
Value | $ 446,512 | $ 446,512 | |||
Change in Value | $ (11,298) |
Fair Value Measurements - Cha58
Fair Value Measurements - Changes in Life Expectancy Used to Estimate Fair Value of Revolving Credit Facility (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Dec. 31, 2014 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Value | $ 145,831 | |||
Change in Value | $ 0 | |||
Revolving Credit Facility | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Value | $ 157,946 | $ 157,946 | ||
+6 Life Expectancy Months Adjustment | Revolving Credit Facility | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Value | 132,093 | |||
Change in Value | $ (25,853) | |||
-6 Life Expectancy Months Adjustment | Revolving Credit Facility | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Value | $ 182,793 | |||
Change in Value | $ 24,847 |
Fair Value Measurements - Cha59
Fair Value Measurements - Changes in Weighted Average Discount Rate Used to Estimate Fair Value of Revolving Credit Facility (Detail) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2015 | Jun. 30, 2015 | Dec. 31, 2014 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Value | $ 145,831 | ||
Change in Value | $ 0 | ||
Revolving Credit Facility | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Value | $ 157,946 | $ 157,946 | |
.50% Decrease in Discount Rate | Revolving Credit Facility | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Discount Rate | 23.05% | ||
Value | $ 160,730 | ||
Change in Value | $ 2,784 | ||
.50% Increase in Discount Rate | Revolving Credit Facility | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Discount Rate | 24.05% | ||
Value | $ 155,255 | ||
Change in Value | $ (2,691) | ||
Red Falcon Trust | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Discount Rate | 11.18% | ||
Value | $ 55,685 | ||
Change in Value | $ 0 | ||
Red Falcon Trust | .50% Decrease in Discount Rate | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Discount Rate | 10.68% | ||
Value | $ 56,523 | ||
Change in Value | $ 838 | ||
Red Falcon Trust | .50% Increase in Discount Rate | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Discount Rate | 11.68% | ||
Value | $ 54,868 | ||
Change in Value | $ (817) |
Fair Value Measurements - Cha60
Fair Value Measurements - Changes in Fair Value for All Assets and Liabilities Using Material Level of Unobservable (Level 3) Inputs (Detail) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Life Finance | ||
Fair Value, Assets, Unobservable Input Reconciliation [Roll Forward] | ||
Balance, January 1, 2015 | $ 388,886 | $ 302,961 |
Purchase of policies | 30,534 | 3,488 |
Change in fair value | 43,582 | 19,313 |
Matured/lapsed/sold policies | (53,435) | (15,957) |
Premiums paid | 48,243 | 40,578 |
Transfers into level 3 | 0 | 0 |
Transfer out of level 3 | 0 | 0 |
Balance, September 30, 2015 | 457,810 | 350,383 |
Changes in fair value included in earnings for the period relating to assets held at September 30, 2015 | 2,805 | 8,627 |
White Eagle Revolving Credit Facility: | ||
Changes in fair value included in earnings for the period relating to liabilities held at September 30, 2015 | 0 | |
Conversion derivative liability | ||
White Eagle Revolving Credit Facility: | ||
Balance, January 1, 2015 | 16,901 | |
Reclassified to equity | (23,660) | |
Transfers into level 3 | 0 | |
Transfer out of level 3 | 0 | |
Balance, September 30, 2015 | 0 | |
Changes in fair value included in earnings for the period relating to liabilities held at September 30, 2015 | 6,759 | |
White Eagle | Revolving Credit Facility | ||
White Eagle Revolving Credit Facility: | ||
Balance, January 1, 2015 | 145,831 | 123,847 |
Draws under the White Eagle Revolving Credit Facility | 42,448 | 40,965 |
Payments on credit facility | (43,241) | (17,595) |
Unrealized change in fair value | 12,908 | (4,556) |
Transfers into level 3 | 0 | 0 |
Transfer out of level 3 | 0 | 0 |
Balance, September 30, 2015 | 157,946 | 142,661 |
Changes in fair value included in earnings for the period relating to liabilities held at September 30, 2015 | 12,908 | $ (4,556) |
Red Falcon Trust | Revolving Credit Facility | ||
White Eagle Revolving Credit Facility: | ||
Balance, January 1, 2015 | 0 | |
Draws under the White Eagle Revolving Credit Facility | 54,000 | |
Subsequent draws under the Red Falcon Revolving Credit Facility | 2,967 | |
Payments on credit facility | (1,863) | |
Unrealized change in fair value | 581 | |
Transfers into level 3 | 0 | |
Transfer out of level 3 | 0 | |
Balance, September 30, 2015 | 55,685 | |
Changes in fair value included in earnings for the period relating to liabilities held at September 30, 2015 | $ 581 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) | Jul. 29, 2013USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Oct. 30, 2014 | Apr. 18, 2013Contract |
Commitments and Contingencies [Line Items] | |||||||
Lease expiration date | Sep. 30, 2020 | ||||||
Annual base rent | $ 225,100 | ||||||
Percentage of annual increase of base rent | 3.00% | ||||||
Rent expense under operating lease | $ 122,000 | $ 126,000 | $ 319,000 | $ 377,000 | |||
Operating leases, remainder of year ended december 31, 2015 | 58,000 | 58,000 | |||||
Indemnification expenses | 998,000 | 500,000 | $ 2,500,000 | 1,500,000 | |||
Non-prosecution agreement terms | 3 years | ||||||
Percentage of outstanding shares to be obtained written consent | 3.00% | ||||||
Pending Litigation | |||||||
Commitments and Contingencies [Line Items] | |||||||
Litigation-related fees | $ 2,800,000 | $ 1,200,000 | $ 7,000,000 | $ 3,200,000 | |||
Number of policies | Contract | 28 | ||||||
Pending Litigation | Minimum | |||||||
Commitments and Contingencies [Line Items] | |||||||
Compensatory damages sought in addition to an award of punitive damages | $ 30,000,000 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2014 | Sep. 30, 2015 | Dec. 31, 2014 | Sep. 01, 2015 | Sep. 30, 2014 | Feb. 28, 2014 | ||
Stockholders Equity [Line Items] | |||||||||
Rights offering shares | 400.00% | 400.00% | |||||||
Common stock, par value | $ 5.75 | ||||||||
Number of common stock reserved for issuance | 1,337,686 | ||||||||
Common stock issued for rights offering, net of costs | 6,688,433 | ||||||||
Options Outstanding (shares) | 774,394 | 774,394 | 807,949 | ||||||
Increase in additional paid-in-capital due to reclassification of embedded derivative | $ 14,100,000 | ||||||||
Estimated Fair Value Of Warrants | $ 5,400,000 | $ 5,400,000 | |||||||
Common stock warrants term | 5 years | ||||||||
Exercise price of warrants | $ 10.75 | $ 10.75 | |||||||
Additional paid-in-capital | $ 305,389,000 | $ 305,389,000 | 266,705,000 | [1] | |||||
Share and note repurchase program, authorized amount | $ 10,000,000 | ||||||||
Cost of shares acquired | $ 348,000 | 348,000 | $ 0 | [1] | |||||
Average cost per share (usd per share) | $ 5.30 | ||||||||
Remaining authorized amount | $ 9,700,000 | $ 9,700,000 | |||||||
Restricted Stock | |||||||||
Stockholders Equity [Line Items] | |||||||||
Stock granted (shares) | 41,259 | ||||||||
Performance Shares | |||||||||
Stockholders Equity [Line Items] | |||||||||
Stock granted (shares) | 0 | ||||||||
Minimum | |||||||||
Stockholders Equity [Line Items] | |||||||||
Average daily trading closing price | $ 8.50 | $ 8.50 | |||||||
Average daily trading closing price, period | 45 days | ||||||||
Common Stock | |||||||||
Stockholders Equity [Line Items] | |||||||||
Common stock issued for rights offering, net of costs | 6,688,433 | ||||||||
Treasury Stock | |||||||||
Stockholders Equity [Line Items] | |||||||||
Antidilutive securities excluded from computation of diluted earnings per share (shares) | 65,621 | ||||||||
Shares repurchased | (65,621,000) | ||||||||
Accounting Standards Update 2013-11 | |||||||||
Stockholders Equity [Line Items] | |||||||||
Additional paid-in-capital | $ 6,300,000 | $ 6,300,000 | |||||||
Derivative Actions | Common Stock | |||||||||
Stockholders Equity [Line Items] | |||||||||
Common stock issued for legal settlement | 125,628 | ||||||||
Omnibus Plan | |||||||||
Stockholders Equity [Line Items] | |||||||||
Securities remaining for future issuance | 1,808,735 | 1,808,735 | |||||||
Omnibus Plan | Stock Option | |||||||||
Stockholders Equity [Line Items] | |||||||||
Shares of common stock reserved for future grant | 2,700,000 | 2,700,000 | |||||||
Options Outstanding (shares) | 774,394 | 774,394 | |||||||
Omnibus Plan | Restricted Stock | |||||||||
Stockholders Equity [Line Items] | |||||||||
Number of common stock reserved for issuance | 103,112 | 103,112 | |||||||
Stock vesting period | 1 year | ||||||||
Omnibus Plan | Performance Shares | |||||||||
Stockholders Equity [Line Items] | |||||||||
Stock granted (shares) | 323,500 | 323,500 | |||||||
Stock granted, subject to shareholders' approval of an amendment and restatement | 150,000 | 150,000 | |||||||
Stock vesting period | 1 year | ||||||||
Omnibus Plan | Minimum | Performance Shares | |||||||||
Stockholders Equity [Line Items] | |||||||||
Actual shares to be issued | 0.00% | 0.00% | |||||||
Omnibus Plan | Maximum | Performance Shares | |||||||||
Stockholders Equity [Line Items] | |||||||||
Actual shares to be issued | 150.00% | 150.00% | |||||||
Omnibus Plan | Common Stock | Restricted Stock | |||||||||
Stockholders Equity [Line Items] | |||||||||
Stock granted (shares) | 41,259 | ||||||||
8.50% Senior Unsecured Convertible Notes Due 2019 | |||||||||
Stockholders Equity [Line Items] | |||||||||
Common stock issued for rights offering, net of costs | 6,688,433 | ||||||||
Stated interest rate | 8.50% | ||||||||
[1] | Derived from audited consolidated financial statements. |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2015 | Sep. 30, 2014 | Mar. 31, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | [1] | |
Income Taxes [Line Items] | |||||||
Annual effective tax rate | 35.00% | 36.90% | |||||
Deferred tax assets valuation allowance | $ 2,000 | $ 2,000 | |||||
Tax benefit from tax rate changes | 927 | ||||||
(Benefit) provision for income taxes | (4,721) | $ (2,235) | (6,981) | $ (2,452) | |||
Additional paid-in-capital | $ 305,389 | $ 305,389 | $ 266,705 | ||||
Accounting Standards Update 2013-11 | |||||||
Income Taxes [Line Items] | |||||||
Unrecognized tax benefits | $ 6,300 | ||||||
(Benefit) provision for income taxes | 3,700 | ||||||
Valuation allowance (decrease) increase | 2,600 | ||||||
Additional paid-in-capital | $ 6,300 | $ 6,300 | $ 6,300 | ||||
[1] | Derived from audited consolidated financial statements. |