Quarterly report pursuant to Section 13 or 15(d)

Stockholders' Equity

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Stockholders' Equity
 9 Months Ended
Sep. 30, 2014
Equity [Abstract]  
Stockholders' Equity

10. Stockholders’ Equity

The following table summarizes the changes in our stockholders’ equity for the nine months ended September 30, 2014 (dollars in thousands):

 

                                       Distributions in        
                          Additional      Notes     Excess of     Total  
     Preferred      Senior Common      Common      Paid in      Receivable     Accumulated     Stockholders’  
     Stock      Stock      Stock      Capital      from Employees     Earnings     Equity  

Balance at December 31, 2013

    $ 2       $ —         $ 16       $ 298,751       $ (375 )    $ (115,248 )    $ 183,146   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

    

 

 

    

 

 

  

Issuance of senior common stock and common stock, net

      —           1         2         40,332         —          —          40,335   

Distributions declared to common, senior common and preferred stockholders

      —           —           —           —           —          (22,219 )      (22,219 ) 

Net loss

      —           —           —           —           —          (12,066 )      (12,066 ) 
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

    

 

 

    

 

 

  

Balance at September 30, 2014

    $ 2       $ 1       $ 18       $ 339,083       $ (375 )    $ (149,533 )    $ 189,196   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

    

 

 

    

 

 

  

Distributions

Our Board of Directors declared the following distributions per share for the three and nine months ended September 30, 2014 and 2013:

 

     For the three months ended September 30,      For the nine months ended September 30,  
     2014      2013      2014      2013  

Common Stock

    $ 0.375       $ 0.375       $ 1.125       $ 1.125   

Senior Common Stock

      0.2625         0.2625         0.7875         0.7875   

Series A Preferred Stock

      0.4843749         0.4843749         1.4531247         1.4531247   

Series B Preferred Stock

      0.4688         0.4688         1.4063         1.4063   

Series C Preferred Stock

      0.4453         0.4453         1.3359         1.3359   

Recent Activity

On June 6, 2014, we completed a public offering of 1,610,000 shares of our common stock at a public offering price of $17.00 per share. Gross proceeds of the offering totaled $27.4 million and net proceeds, after deducting offering expenses borne by us, were $26.0 million, which we used to acquire real estate.

 

Ongoing Activity

On September 2, 2014, we entered into an open market sale arrangement, or the ATM Program, with Cantor Fitzgerald & Co., or Cantor Fitzgerald, pursuant to which we may, from time to time, offer to sell shares of our common stock with an aggregate sales price of up to $100.0 million on the open market through Cantor Fitzgerald, acting as sales agent and/or principal. Under the open market sales arrangement, Cantor Fitzgerald is entitled to compensation equal to up to 2.0% of the gross proceeds of the common shares it sells. During the three months ended September 30, 2014, we sold a total of 0.2 million shares with aggregate net proceeds of $3.3 million, and have a remaining capacity to sell up to $96.6 million of common stock under the ATM program with Cantor Fitzgerald.

On August 26, 2014, we provided notice of our termination of our prior open market sale arrangement, or the Prior ATM program, with Jefferies LLC, or Jefferies, under which we offered 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. From November 2009 through August 2014, we issued and sold $21.8 million in gross proceeds under the Prior ATM program. During the nine months ended September 30, 2014, we raised approximately $7.6 million in net proceeds under the Prior ATM program.

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 September 30, 2014, we had sold 593,659 shares of senior common stock in this ongoing offering, for gross proceeds of $8.9 million, and issued an additional 18,479 shares of senior common stock under the DRIP program.

Note to Employee

The following table is a summary of the outstanding note receivable from an employee of the Adviser for the exercise of stock options (dollars in thousands):

 

Date Issued

    Outstanding Balance
of Employee Loan at
September 30, 2014		      Outstanding Balance
of Employee Loan at
December 31, 2013		      Maturity Date
of Note		      Interest Rate
on Note		  

Nov 2006

    $ 375       $ 375         Nov 2015         8.15 % 

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, this note was recorded as a full recourse loan to the employee and is included in the equity section of the accompanying condensed consolidated balance sheets. As of September 30, 2014, this loan maintained its full recourse status.