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RECENT ACTIVITIES
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9 Months Ended |
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Sep. 30, 2014
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| Subsequent Events [Abstract] | |
| RECENT ACTIVITIES |
19. RECENT
ACTIVITIES
These financial statements include a discussion of material events, if any, that have occurred subsequent to September 30, 2014 (referred to as “subsequent events”) through the issuance of these consolidated financial statements. Events subsequent to that date have not been considered in these financial statements.
On October 7, 2014, Newcastle entered into a new loan agreement in the total amount of $115.0 million, which carries an interest rate of LIBOR plus 3.25% and has an initial maturity date of October 6, 2017. The loan is secured by the senior housing triple net lease properties acquired by Newcastle on June 30, 2014 and consist of six properties.
On October 16, 2014, Newcastle's board of directors approved a 1-for-2 reverse stock split. The reverse stock split was effective
after the close of trading on October 22, 2014 and shares of Newcastle's common stock began trading on a reverse split-adjusted
basis on the New York Stock Exchange beginning at the opening of trading on October 23, 2014. No fractional shares were issued
in connection with the reverse stock split. Each stock holder who would otherwise be entitled to receive a fractional share
of Newcastle's common stock was entitled to receive a cash payment in lieu of a fractional share. The reverse stock split
was not subject to stockholder approval and did not change the authorized number of shares of Newcastle or the par value of
Newcastle's common stock or preferred stock.
On
October 27, 2014, the SEC declared effective New Seniors registration statement on Form 10. The spin-off of New Senior will
be effected as a distribution of all of the outstanding shares of common stock of New Senior to the holders of Newcastle
common stock. Newcastle will distribute one share of New Senior common stock for each share of Newcastle common stock held by
Newcastle stockholders of record as of the record date, October 27, 2014. The distribution is expected to occur on November
6, 2014. The distribution ratio is based on the number of Newcastle shares outstanding following the 1-for-2 reverse stock
split. In connection with the spin-off, Newcastle contributed to New Senior all of its investments in senior housing
properties, any liabilities relating to these properties (including the loan noted above) and a cash and cash equivalents
balance of approximately $243 million. The spin-off will be effected as a distribution of all of the outstanding shares of
common stock of New Senior to the holders of Newcastle common stock. Newcastle will distribute one share of New Senior common
stock for each share of Newcastle common stock held by Newcastle stockholders of record as of the record date, October 27,
2014. The distribution is expected to occur on November 6, 2014. The distribution ratio is based on the number of
Newcastle shares outstanding following the 1-for-2 reverse stock split.
On October 28, 2014, Newcastle entered into a lease termination agreement for its Golf course located in Killearn, Florida. The lease was originally scheduled to expire on February 28, 2020 and was projected to generate negative cash flow for the remainder of the lease term. Under the terms of the agreement, Newcastle paid $0.8 million to the landlord as lease termination charges. After termination, Newcastle has no significant remaining commitments under the lease.
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