Annual report pursuant to Section 13 and 15(d)

EQUITY AND EARNINGS PER SHARE - Outstanding Options (Details 2)

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EQUITY AND EARNINGS PER SHARE - Outstanding Options (Details 2) (USD $)
In Thousands, except Share data, unless otherwise specified
 1 Months Ended 12 Months Ended
Nov. 30, 2013
Jun. 30, 2013
Feb. 28, 2013
Jan. 31, 2013
Jul. 31, 2012
May 31, 2012
Apr. 30, 2012
Sep. 30, 2011
Mar. 31, 2011
Dec. 31, 2013
Dec. 31, 2012
Stock Options outstanding                   30,542,553 13,409,275
Options Exercisable                   13,737,462  
Options Exercised
                      
Date of Exercise                   Prior to 2008  
Options Exercised                   (1,043,118) [1]  
Exercises - Weighted Average Strike Price                   $ 15.70 [2]  
Options Exercised
                      
Date of Exercise                   Oct 12  
Options Exercised                   (95,834) [3]  
Exercises - Weighted Average Strike Price                   $ 5.28 [2]  
Options Exercised
                      
Date of Exercise                   Sep 13  
Options Exercised                   (307,833) [4]  
Exercises - Weighted Average Strike Price                   $ 2.56 [2]  
Options Expired Unexercised
                      
Date of Grant                   2002-2003  
Options expired unexercised                   (464,484)  
Directors
                      
Stock Options outstanding                   4,000 12,000
Options Exercised                   4,000  
Directors | Stock Options
                      
Recipient                   Directors  
Date of Grant                   Various  
Stock Options outstanding                   20,000  
Options Exercisable                   4,000  
Weighted Average Strike Price                   $ 8.06 [2]  
Intrinsic Value                   $ 4,800  
Manager | Stock Options
                      
Recipient                   Manager  
Date of Grant                   2002 - 2007  
Stock Options outstanding                   3,523,727 [5]  
Options Exercisable                   2,032,125 [5]  
Weighted Average Strike Price                   $ 12.66 [2]  
Fair Value at Date of Grant                   $ 6,400 [6]  
Intrinsic Value                   8,900  
Manager | Stock Options
                      
Recipient                   Manager  
Date of Grant                   Mar 11  
Stock Options outstanding                   1,725,000 [5]  
Options Exercisable                   1,580,166 [5]  
Weighted Average Strike Price                   $ 2.72 [2]  
Fair Value at Date of Grant                   $ 7,000 [6],[7]  
Intrinsic Value                   5,500  
Manager | Stock Options
                      
Recipient                   Manager  
Date of Grant                   Sep 11  
Stock Options outstanding                   2,587,500 [5]  
Options Exercisable                   2,165,361 [5]  
Weighted Average Strike Price                   $ 2.07 [2]  
Fair Value at Date of Grant                   $ 5,600 [6],[8]  
Intrinsic Value                   6,100  
Manager | Stock Options
                      
Recipient                   Manager  
Date of Grant                   Apr 12  
Stock Options outstanding                   1,897,500 [5]  
Options Exercisable                   1,244,778 [5]  
Weighted Average Strike Price                   $ 2.82 [2]  
Fair Value at Date of Grant                   $ 5,600 [6],[9]  
Intrinsic Value                   6,700  
Manager | Stock Options
                      
Recipient                   Manager  
Date of Grant                   May 12  
Stock Options outstanding                   2,300,000 [5]  
Options Exercisable                   1,421,667 [5]  
Weighted Average Strike Price                   $ 3.05 [2]  
Fair Value at Date of Grant                   $ 7,600 [10],[6]  
Intrinsic Value                   8,600  
Manager | Stock Options
                      
Recipient                   Manager  
Date of Grant                   Jul 12  
Stock Options outstanding                   2,530,000 [5]  
Options Exercisable                   1,416,195 [5]  
Weighted Average Strike Price                   $ 3.04 [2]  
Fair Value at Date of Grant                   $ 8,300 [11],[6]  
Intrinsic Value                   2,300  
Manager | Stock Options
                      
Recipient                   Manager  
Date of Grant                   Jan 13  
Stock Options outstanding                   5,750,000 [5]  
Options Exercisable                   2,108,333 [5]  
Weighted Average Strike Price                   $ 4.24 [2]  
Fair Value at Date of Grant                   $ 18,000 [12],[6]  
Intrinsic Value                   3,100  
Manager
                      
Date of Grant                   Feb 13  
Stock Options outstanding                   2,300,000 [5]  
Options Exercisable                   766,667 [5]  
Weighted Average Strike Price                   $ 4.75 [2]  
Intrinsic Value                   $ 2,800  
Manager | Stock Options
                      
Recipient                   Manager  
Fair Value at Date of Grant                   $ 8,400 [13],[6]  
Manager | Stock Options
                      
Recipient                   Manager  
Date of Grant                   Jun 13  
Stock Options outstanding                   4,025,000 [5]  
Options Exercisable                   805,000 [5]  
Weighted Average Strike Price                   $ 4.97 [2]  
Fair Value at Date of Grant                   $ 3,800 [14],[6]  
Manager | Stock Options
                      
Recipient                   Manager  
Date of Grant                   Nov 13  
Stock Options outstanding                   5,795,095 [5]  
Options Exercisable                   193,170 [5]  
Weighted Average Strike Price                   $ 5.25 [2]  
Fair Value at Date of Grant                   $ 6,000 [15],[6]  
Manager
                      
Stock Options outstanding                   27,492,983 9,685,338
Options Exercised                   8,030  
Fair Value at Date of Grant $ 6,000 [16] $ 3,800 [16] $ 8,400 [16] $ 18,000 [16] $ 8,300 [16] $ 7,600 [16] $ 5,600 [16] $ 5,600 [16] $ 7,000 [16]    
[1] 670,620 of the total options exercised were by the Manager. 368,498 of the total options exercised were by employees of Fortress subsequent to their assignment. 4,000 of the total options exercised were by directors.
[2] The strike prices are subject to adjustment in connection with return of capital dividends and spin-offs. A portion of Newcastle's 2008 dividends was deemed return of capital dividends. The effect on the strike prices was not significant. The strike prices were adjusted for the New Residential spin-off as described above. As of December 31, 2013, the weighted average strike price of the outstanding options issued prior to 2011 was $12.66.
[3] Exercised by employees of Fortress subsequent to their assignment. The options exercised had an intrinsic value of $0.2 million.
[4] Exercised by employees of Fortress subsequent to their assignment. The options exercised had an intrinsic value of $0.9 million.
[5] The Manager assigned certain of its options to Fortress's employees as follows: (See Schedule of Outstanding Options)
[6] The fair value of the options was estimated using an option valuation model. Since the Newcastle Option Plan and 2012 Plan have characteristics significantly different from those of traded options, and since the assumptions used in such model, particularly the volatility assumption, are subject to significant judgment and variability, the actual value of the options could vary materially from management's estimate. The volatility assumption for these options was estimated based primarily on the historical volatility of Newcastle's common stock and management's expectations regarding future volatility. The expected life assumption for options issued prior to 2011 was estimated based on the simplified term method. This simplified method was used because Newcastle did not have sufficient historical data to conclude on the appropriate expected life of its options and because historical data to date was consistent with the simplified term method. The expected life assumption for options issued in 2011 and thereafter was estimated based primarily on the historical expected life of applicable previously issued options.
[7] The assumptions used in valuing the options were: a 1.7% risk-free rate, 107.8% volatility and a 3.3 year expected term.
[8] The assumptions used in valuing the options were: a 1.13% risk-free rate, 13.2% dividend yield, 151.1% volatility and a 4.6 year expected term.
[9] The assumptions used in valuing the options were: a 1.3% risk-free rate, 12.9% dividend yield, 149.4% volatility and a 4.7 year expected term.
[10] The assumptions used in valuing the options were: a 1.05% risk-free rate, 11.9% dividend yield, 148.4% volatility and a 4.8 year expected term.
[11] The assumptions used in valuing the options were: a 0.75% risk-free rate, 11.9% dividend yield, 147.5% volatility and a 4.8 year expected term.
[12] The assumptions used in valuing the options were: a 2.0% risk-free rate, 8.8% dividend yield, 56.2% volatility and a 10 year term.
[13] The assumptions used in valuing the options were: a 2.1% risk-free rate, 7.8% dividend yield, 55.5% volatility and a 10 year term.
[14] The assumptions used in valuing the options were: a 2.5% risk-free rate, 8.8% dividend yield, 36.9% volatility and a 10 year term.
[15] The assumptions used in valuing the options were: a 2.8% risk-free rate, 6.7% dividend yield, 32.0% volatility and a 10 year term.
[16] In connection with these offerings, Newcastle granted options to the Manager for the purpose of compensating the Manager for its successful efforts in raising capital for Newcastle.