Annual report pursuant to Section 13 and 15(d)

Stockholders' Equity

v2.4.0.6
Stockholders' Equity
 12 Months Ended
Dec. 31, 2012
Mandatorily Redeemable Preferred Stock and Stockholders' Equity [Abstract]  
Stockholders' Equity

8. Stockholders’ Equity

Distributions

Our Board of Directors declared the following distributions per share for the years ended December 31, 2012, 2011 and 2010:

 

                         
    For the year ended December 31,  
    2012     2011     2010  

Common Stock

   $ 1.50     $ 1.50     $ 1.50  

Senior Common Stock

     1.05       1.05       0.7875  

Series A Preferred Stock

     1.9374996       1.9374996       1.9374996  

Series B Preferred Stock

     1.8750       1.8750       1.8750  

Series C Preferred Stock

     1.6328       N/A (1)       N/A (1)  

 

(1) 

There was no Series C Preferred Stock outstanding during the years ended December 31, 2011 and 2010.

For federal income tax purposes, distributions paid to stockholders may be characterized as ordinary income, capital gains, return of capital or a combination of the foregoing. There were no capital gains during the last three years. The characterization of distributions during each of the last three years is reflected in the table below:

 

                 
    Ordinary Income     Return of Capital  

Common Stock

                

For the year ended December 31, 2010

     15.76540 %      84.23460 % 

For the year ended December 31, 2011

     16.62560 %      83.37440 % 

For the year ended December 31, 2012

     0.00000 %      100.00000 % 

Senior Common Stock

                

For the year ended December 31, 2010

     100.00000 %      0.00000 % 

For the year ended December 31, 2011

     100.00000 %      0.00000 % 

For the year ended December 31, 2012

     0.00000 %      100.00000 % 

Series A Preferred Stock

                

For the year ended December 31, 2010

     100.00000 %      0.00000 % 

For the year ended December 31, 2011

     100.00000 %      0.00000 % 

For the year ended December 31, 2012

     91.70830 %      8.29170 % 

Series B Preferred Stock

                

For the year ended December 31, 2010

     100.00000 %      0.00000 % 

For the year ended December 31, 2011

     100.00000 %      0.00000 % 

For the year ended December 31, 2012

     91.70830 %      8.29170 % 

Series C Preferred Stock

                

For the year ended December 31, 2010

     N/A       N/A (1)  

For the year ended December 31, 2011

     N/A       N/A (1)  

For the year ended December 31, 2012

     91.70830 %      8.29170 % 

 

(1)

There was no Series C Preferred Stock outstanding during the years ended December 31, 2011 and 2010.

 

Ongoing Activity

We have an open market sale agreement, or the Open Market Sale Agreement, with Jefferies & Company, Inc., or Jefferies, under which we may, from time to time, offer to sell shares of our common stock with an aggregate sales price of up to $25.0 million on the open market through Jefferies, as agent, or to Jefferies, as principal. As of December 31, 2012, we had sold 330,570 shares with gross proceeds of $6.1 million, and have a remaining capacity to sell up to $18.9 million of common stock under the Open Market Sale Agreement with Jefferies.

In March 2011, we commenced an offering of an aggregate of 3,500,000 shares of our senior common stock, par value $0.001 per share, at a price to the public of $15.00 per share, of which 3,000,000 shares are intended to be offered pursuant to the primary offering and 500,000 shares are intended to be offered pursuant to our senior common distribution reinvestment plan, or the DRIP. We, however, reserve the right to reallocate the number of shares being offered between the primary offering and the DRIP. As of December 31, 2012 we have sold 118,738 shares of senior common stock in this ongoing offering, for gross proceeds of $1.8 million, and issued an additional 1,395 shares of senior common stock under the DRIP program.

Notes to Employees

The following table is a summary of all outstanding notes issued to employees of the Adviser for the exercise of stock options (dollars in thousands):

 

                                                         

Date Issued

   Number of
Options
Exercised		     Strike Price
of Options
Exercised		     Amount of
Promissory Note
Issued to Employees		     Outstanding Balance
of Employee Loans at
December 31, 2012		     Outstanding Balance
of Employee Loans at
December 31, 2011		     Maturity Date
of Note		     Interest Rate
on Note		  

Sep 2004

     25     $ 15.00     $ 375     $ —       $ 11       Sep 2013       5.00 % 

Apr 2006

     12       16.10       193       3       4       Apr 2015       7.77 % 

May 2006

     2       16.10       32       32       32       May 2016       7.87 % 

Nov 2006

     25       15.00       375       375       375       Nov 2015       8.15 % 
   

 

 

            

 

 

    

 

 

    

 

 

                  
      64             $ 975     $ 410     $ 422                  
   

 

 

            

 

 

    

 

 

    

 

 

                  

In accordance with ASC 505-10-45-2, “Equity,” receivables from employees for the issuance of capital stock to employees prior to the receipt of cash payment should be reflected in the balance sheet as a reduction to stockholders’ equity. Therefore, these notes were recorded as full recourse loans to employees and are included in the equity section of the accompanying consolidated balance sheets. As of December 31, 2012, each loan maintained its full recourse status.