Quarterly report pursuant to Section 13 or 15(d)

EQUITY AND EARNINGS PER SHARE

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EQUITY AND EARNINGS PER SHARE
 3 Months Ended
Mar. 31, 2014
Equity And Earnings Per Share  
EQUITY AND EARNINGS PER SHARE
13.   EQUITY AND EARNINGS PER SHARE
 
A. Stockholder's Equity
 

In connection with the spin-off of New Media on February 13, 2014, the strike price of each Newcastle option was reduced by $0.89 to reflect the adjusted value of Newcastle’s shares as a result of the spin-off. The adjusted value was calculated based on the five day average closing price of the New Media‘s shares subsequent to the spin-off date.
Newcastle’s outstanding options at March 31, 2014 consisted of the following:
 
Number of Options
 
Strike Price (A)
 
Maturity Date
 
343,275

 
$
10.28

 
5/25/2014
 
162,500

 
12.84

 
11/22/2014
 
330,000

 
12.03

 
1/12/2015
 
2,000

 
12.62

 
8/1/2015
 
170,000

 
11.95

 
11/1/2016
 
242,000

 
12.80

 
1/23/2017
 
456,000

 
11.19

 
4/11/2017
 
1,580,166

 
1.51

 
3/29/2021
 
2,424,833

 
0.86

 
9/27/2021
 
2,000

 
1.07

 
12/20/2021
 
1,867,167

 
1.61

 
4/3/2022
 
2,265,000

 
1.84

 
5/21/2022
 
2,499,167

 
1.83

 
7/31/2022
 
5,750,000

 
3.03

 
1/11/2023
 
2,300,000

 
3.54

 
2/15/2023
 
4,025,000

 
3.76

 
6/17/2023
 
5,795,095

 
4.04

 
11/22/2023
Total W/A
30,214,203

 
$
3.31

 
 
 
(A)
The strike prices are subject to adjustment in connection with return of capital dividends. In the first quarter of 2014 strike prices were adjusted by $0.32 reflecting the portion of Newcastle’s 2013 dividends which was deemed return of capital.

 
As of March 31, 2014, Newcastle’s outstanding options were summarized as follows:
Held by the Manager
25,653,733

Issued to the Manager and subsequently transferred to certain of the Manager's employees
4,556,470

Issued to the independent directors
4,000

Total
30,214,203

On March 14, 2014, Newcastle declared a quarterly dividend of $0.10 per common share, and declared dividends of $0.609375, $0.503125 and $0.523438 per share on the 9.750% Series B, 8.050% Series C and 8.375% Series D preferred stock, respectively, for the quarter ended March 31, 2014. Dividends totaling $36.5 million were paid in April 2014.
 
B. Earnings Per Share
 
Newcastle is required to present both basic and diluted earnings per share (“EPS”). Basic EPS is calculated by dividing net income available for common stockholders by the weighted average number of shares of common stock outstanding during each period. Diluted EPS is calculated by dividing net income available for common stockholders by the weighted average number of shares of common stock outstanding plus the additional dilutive effect of common stock equivalents during each period. Newcastle’s common stock equivalents are its outstanding stock options. As of March 31, 2014, Newcastle had 1,705,775 antidilutive options. During the three months ended March 31, 2014 and 2013, based on the treasury stock method, Newcastle had 11,613,274 and 4,942,388 dilutive common stock equivalents, respectively, resulting from its outstanding options. Net income available for common stockholders is equal to net income less preferred dividends and net income attributable to noncontrolling interest.