Mandatorily Redeemable Preferred Stock |
6 Months Ended |
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Jun. 30, 2016 | |
| Equity [Abstract] | |
| Mandatorily Redeemable Preferred Stock |
Mandatorily Redeemable Preferred Stock
In February 2012, we completed a public offering of 1,540,000 shares of 7.125% Series C Cumulative Term Preferred Stock, par value $0.001 per share, or the Term Preferred Stock, at a public offering price of $25.00 per share. Gross proceeds of the offering totaled $38.5 million and net proceeds, after deducting offering expenses borne by us, were $36.7 million. The Term Preferred Stock is traded under the ticker symbol GOODN on the NASDAQ Global Select Market, or the NASDAQ. The Term Preferred Stock is not convertible into our common stock or any other security of ours. As of January 31, 2016, we may redeem the shares at a redemption price of $25.00 per share, plus any accumulated and unpaid dividends to and including the date of redemption. The shares of the Term Preferred Stock have a mandatory redemption date of January 31, 2017. We incurred $1.8 million in total offering costs related to these transactions, which have been recorded net of the Series C mandatorily redeemable preferred stock on the condensed consolidated balance sheet and will be amortized over the redemption period, ending August 19, 2016, see Note 11 for further information regarding the redemption of the Term Preferred Stock.
The Term Preferred Stock is recorded as a liability in accordance with ASC 480, “Distinguishing Liabilities from Equity,” which states that mandatorily redeemable financial instruments should be classified as liabilities and therefore the related dividend payments are treated as a component of interest expense in the condensed consolidated statements of operations.
During June 2016, we partially redeemed $25.0 million of our Term Preferred Stock and accordingly wrote-off $0.1 million of unamortized offering costs, which were recorded to interest expense in our condensed consolidated statements of operations.
Subsequent to the second quarter, we sent notices of redemption for the remaining 540,000 shares outstanding of our Term Preferred Stock. We intend to redeem these shares on August 19, 2016 at a redemption price of $25.00 per share, plus an amount equal to all accumulated and unpaid dividends.
The fair value of our Term Preferred Stock as of June 30, 2016, was $13.6 million, as compared to the carrying value of $13.4 million, which includes $0.1 million of unamortized deferred financing costs. The fair value is calculated based on the closing share price as of June 30, 2016 of $25.20. The fair value was calculated using Level 1 inputs of the hierarchy established by ASC 820, “Fair Value Measurements and Disclosures.”
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