Cover Page
Cover Page - shares | 9 Months Ended | |
Aug. 31, 2020 | Oct. 14, 2020 | |
Cover [Abstract] | ||
Entity Registrant Name | Emergent Capital, Inc. | |
Entity Central Index Key | 0001494448 | |
Current Fiscal Year End Date | --11-30 | |
Entity Filer Category | Non-accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Aug. 31, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Trading Symbol | EMGC | |
Entity Current Reporting Status | Yes | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Interactive Data Current | Yes | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Common Stock, Shares Outstanding | 158,655,140 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Aug. 31, 2020 | Nov. 30, 2019 | [1] |
ASSETS | |||
Cash and cash equivalents | $ 19,054 | $ 24,283 | |
Certificates of deposit | 517 | 511 | |
Prepaid expenses and other assets | 1,152 | 377 | |
Operating lease asset (Note 18) | 22 | ||
Deposits - other | 1,212 | 1,377 | |
Life settlements, at estimated fair value | 0 | 1,297 | |
Fixed assets, net | 0 | 18 | |
Investment in limited partnership, at estimated fair value (Note 11) | 152,450 | 137,849 | |
Total assets | 174,407 | 165,712 | |
Liabilities | |||
Accounts payable and accrued expenses | 1,337 | 1,651 | |
Other liabilities | 0 | 86 | |
Current tax liability | 2,623 | 3,195 | |
Total liabilities | 116,148 | 123,599 | |
Commitments and Contingencies (Note 18) | |||
Stockholders’ Equity | |||
Common stock (par value $0.01 per share, 415,000,000 authorized at August 31 ,2020 and November 30, 2019; 159,263,140 issued and 158,655,140 outstanding as of August 31, 2020; 158,365,275 issued and 157,757,275 outstanding as of November 30, 2019) | 1,593 | 1,584 | |
Preferred stock (par value $0.01 per share, 40,000,000 authorized; 0 issued and outstanding as of August 31, 2020 and November 30, 2019) | 0 | 0 | |
Treasury Stock, net of issuance cost 608,000 shares as of August 31, 2020 and November 30, 2019) | (2,534) | (2,534) | |
Additional paid-in-capital | 334,641 | 334,576 | |
Accumulated deficit | (275,441) | (291,513) | |
Total stockholders’ equity | 58,259 | 42,113 | |
Total liabilities and stockholders’ equity | 174,407 | 165,712 | |
5.0% Convertible Notes | |||
Liabilities | |||
Interest payable | 159 | 1,116 | |
5.0% Convertible Notes, net of discount and deferred debt costs (Note 14) | 64,420 | 71,022 | |
8.5% Senior Secured Notes | |||
Liabilities | |||
Interest payable | 1,118 | 854 | |
8.5% Senior Secured Notes, net of deferred debt costs (Note 15) | $ 46,491 | $ 45,675 | |
[1] | Derived from audited consolidated financial statements. |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Aug. 31, 2020 | Nov. 30, 2019 | [1] |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |
Common stock, shares authorized (in shares) | 415,000,000 | 415,000,000 | |
Common stock, shares issued (in shares) | 159,263,140 | 158,365,275 | |
Common stock, shares outstanding (in shares) | 158,655,140 | 157,757,275 | |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |
Preferred stock, shares authorized (in shares) | 40,000,000 | 40,000,000 | |
Preferred stock, shares issued (in shares) | 0 | 0 | |
Preferred stock, shares outstanding (in shares) | 0 | 0 | |
Treasury stock (in shares) | 608,000 | 608,000 | |
5.0% Convertible Notes | |||
Debt interest rate | 5.00% | 5.00% | |
8.5% Senior Secured Notes | |||
Debt interest rate | 8.50% | 8.50% | |
[1] | Derived from audited consolidated financial statements. |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | |
Income | ||||
Change in fair value of life settlements (Notes 10 & 16) | $ 0 | $ (42) | $ 0 | $ (37) |
Change in fair value of investment in limited partnership, net of distributions (Notes 11 and 16) | 4,250 | (5,821) | 20,601 | (5,821) |
Change in fair value of investment in deconsolidated subsidiaries (Notes 4 & 16) | 0 | 90,710 | 0 | 37,941 |
Gain on life settlements, net (Note 10) | 0 | 0 | 743 | 0 |
Other income | 57 | 2,052 | 10,875 | 2,145 |
Total income | 4,307 | 86,899 | 32,219 | 34,228 |
Expenses | ||||
Interest expense | 2,743 | 2,832 | 7,610 | 8,370 |
Extinguishment of debt | 0 | 0 | (2,815) | 0 |
Personnel costs | 444 | 694 | 2,833 | 1,001 |
Legal fees | 738 | 1,448 | 1,850 | 2,117 |
Professional fees | 619 | 1,142 | 2,034 | 1,470 |
Insurance | 519 | 270 | 1,360 | 666 |
Other selling, general and administrative expenses | 272 | 317 | 792 | 516 |
Total expenses | 5,335 | 6,703 | 13,664 | 14,140 |
Income (loss) from continuing operations before income taxes | (1,028) | 80,196 | 18,555 | 20,088 |
Provision (benefit) provision for income taxes | 0 | (5) | 2,428 | 3,213 |
Net income (loss) from continuing operations | (1,028) | 80,201 | 16,127 | 16,875 |
Discontinued Operations: | ||||
Income (loss) from discontinued operations before income taxes | 0 | 70 | (53) | 36 |
Provision (benefit) provision for income taxes | 0 | 0 | 0 | 0 |
Net income (loss) from discontinued operations | 0 | 70 | (53) | 36 |
Net income (loss) | $ (1,028) | $ 80,271 | $ 16,074 | $ 16,911 |
Basic income (loss) per common share: | ||||
Continuing operations (in dollars per share) | $ (0.01) | $ 0.51 | $ 0.10 | $ 0.11 |
Discontinued operations (in dollars per share) | 0 | 0 | 0 | 0 |
Net income (loss) - basic (in dollars per share) | (0.01) | 0.51 | 0.10 | 0.11 |
Diluted income (loss) per share: | ||||
Continuing operations (in dollars per share) | (0.01) | 0.41 | 0.09 | 0.10 |
Discontinued operations (in dollars per share) | 0 | 0 | 0 | 0 |
Net income (loss) - diluted (in dollars per share) | $ (0.01) | $ 0.41 | $ 0.09 | $ 0.10 |
Weighted average shares outstanding: | ||||
Basic (in shares) | 157,655,140 | 156,968,470 | 157,624,241 | 156,949,425 |
Diluted (in shares) | 157,655,140 | 195,979,957 | 206,696,703 | 194,867,908 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT/EQUITY (UNAUDITED) - USD ($) $ in Thousands | Total | Common Stock | Treasury Stock | Additional Paid-in Capital | Accumulated Deficit | |
Beginning Balance (in shares) at Nov. 30, 2018 | 158,733,928 | (608,000) | ||||
Beginning Balance at Nov. 30, 2018 | $ 27,242 | $ 1,587 | $ (2,534) | $ 334,198 | $ (306,009) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income/(loss) | (37,476) | (37,476) | ||||
Stock-based compensation | 98 | 98 | ||||
Ending Balance (in shares) at Feb. 28, 2019 | 158,733,928 | (608,000) | ||||
Ending Balance at Feb. 28, 2019 | (10,136) | $ 1,587 | $ (2,534) | 334,296 | (343,485) | |
Beginning Balance (in shares) at Nov. 30, 2018 | 158,733,928 | (608,000) | ||||
Beginning Balance at Nov. 30, 2018 | 27,242 | $ 1,587 | $ (2,534) | 334,198 | (306,009) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income/(loss) | 16,911 | |||||
Ending Balance (in shares) at Aug. 31, 2019 | 158,659,803 | (608,000) | ||||
Ending Balance at Aug. 31, 2019 | 44,443 | $ 1,587 | $ (2,534) | 334,488 | (289,098) | |
Beginning Balance (in shares) at Feb. 28, 2019 | 158,733,928 | (608,000) | ||||
Beginning Balance at Feb. 28, 2019 | (10,136) | $ 1,587 | $ (2,534) | 334,296 | (343,485) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income/(loss) | (25,884) | (25,884) | ||||
Stock-based compensation | 97 | 97 | ||||
Retirement of common stock (in shares) | (74,125) | |||||
Retirement of common stock | 0 | |||||
Ending Balance (in shares) at May. 31, 2019 | 158,659,803 | (608,000) | ||||
Ending Balance at May. 31, 2019 | (35,923) | $ 1,587 | $ (2,534) | 334,393 | (369,369) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income/(loss) | 80,271 | 80,271 | ||||
Stock-based compensation | 95 | 95 | ||||
Ending Balance (in shares) at Aug. 31, 2019 | 158,659,803 | (608,000) | ||||
Ending Balance at Aug. 31, 2019 | 44,443 | $ 1,587 | $ (2,534) | 334,488 | (289,098) | |
Beginning Balance (in shares) at Nov. 30, 2019 | 158,365,275 | (608,000) | ||||
Beginning Balance at Nov. 30, 2019 | 42,113 | [1] | $ 1,584 | $ (2,534) | 334,576 | (291,513) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income/(loss) | 12,438 | 12,438 | ||||
Stock-based compensation (in shares) | 1,000,000 | |||||
Stock-based compensation | 32 | $ 10 | 22 | |||
Retirement of common stock (in shares) | (87,309) | |||||
Retirement of common stock | (1) | $ (1) | ||||
Ending Balance (in shares) at Feb. 29, 2020 | 159,277,966 | (608,000) | ||||
Ending Balance at Feb. 29, 2020 | 54,582 | $ 1,593 | $ (2,534) | 334,598 | (279,075) | |
Beginning Balance (in shares) at Nov. 30, 2019 | 158,365,275 | (608,000) | ||||
Beginning Balance at Nov. 30, 2019 | 42,113 | [1] | $ 1,584 | $ (2,534) | 334,576 | (291,513) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income/(loss) | 16,074 | |||||
Ending Balance (in shares) at Aug. 31, 2020 | 159,263,140 | (608,000) | ||||
Ending Balance at Aug. 31, 2020 | 58,259 | $ 1,593 | $ (2,534) | 334,641 | (275,441) | |
Beginning Balance (in shares) at Feb. 29, 2020 | 159,277,966 | (608,000) | ||||
Beginning Balance at Feb. 29, 2020 | 54,582 | $ 1,593 | $ (2,534) | 334,598 | (279,075) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income/(loss) | 4,662 | 4,662 | ||||
Stock-based compensation | 22 | 22 | ||||
Retirement of common stock (in shares) | (14,826) | |||||
Retirement of common stock | 0 | |||||
Ending Balance (in shares) at May. 31, 2020 | 159,263,140 | (608,000) | ||||
Ending Balance at May. 31, 2020 | 59,266 | $ 1,593 | $ (2,534) | 334,620 | (274,413) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income/(loss) | (1,028) | (1,028) | ||||
Stock-based compensation | 21 | 21 | ||||
Ending Balance (in shares) at Aug. 31, 2020 | 159,263,140 | (608,000) | ||||
Ending Balance at Aug. 31, 2020 | $ 58,259 | $ 1,593 | $ (2,534) | $ 334,641 | $ (275,441) | |
[1] | Derived from audited consolidated financial statements. |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOW (UNAUDITED) - USD ($) $ in Thousands | 9 Months Ended | |
Aug. 31, 2020 | Aug. 31, 2019 | |
Cash flows from operating activities | ||
Net income/(loss) | $ 16,074 | $ 16,911 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 18 | 63 |
Change in fair value of investment in deconsolidated subsidiaries | 0 | (37,941) |
Extinguishment of debt | (2,815) | 0 |
Stock-based compensation expense | 74 | 290 |
Interest paid in kind on 8.5% Senior Secured Notes | 0 | 2,842 |
Change in fair value of life settlements | 0 | 37 |
Change in fair value of investment in limited partnership, net of distributions | (20,601) | 5,821 |
Gain on sale of life settlement | (743) | 0 |
Interest income | (311) | (311) |
Deferred tax asset | 0 | 576 |
Change in assets and liabilities: | ||
Deposits - other | 164 | 0 |
Prepaid expenses and other assets | (471) | 118 |
Accounts payable and accrued expenses | (316) | (394) |
Operating lease assets, net of liabilities | (22) | |
Other liabilities | (87) | (155) |
Increase (Decrease) in Income Taxes Payable | (572) | 2,642 |
Net cash (used in) provided by operating activities | (8,593) | (8,493) |
Cash flows from investing activities | ||
Purchase of fixed assets, net of disposals | 0 | (5) |
Premiums paid on life settlements | 0 | (118) |
Proceeds from sale of life settlements, net | 2,041 | 0 |
Distributions from investment in limited partnership | 6,000 | 0 |
Consolidation of subsidiaries (cash) | 0 | 10,905 |
Net cash (used in) provided by investing activities | 8,041 | 10,782 |
Cash flows from financing activities | ||
Proceeds from issue of 8.5% Senior Secured Notes | 0 | 6,476 |
Repayment of 8.5% Convertible Notes | (4,677) | (1,194) |
Net cash provided by financing activities | (4,677) | 5,282 |
Net increase (decrease) in cash and cash equivalents | (5,229) | 7,571 |
Cash and cash equivalents, at beginning of the period | 24,283 | 1,209 |
Cash and cash equivalents, at end of the period | 19,054 | 8,780 |
Supplemental disclosures of cash flow information: | ||
Cash paid for interest during the period | 6,594 | 4,430 |
8.5% Convertible Notes | ||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Amortization of discount and deferred costs | 0 | 21 |
Change in assets and liabilities: | ||
Interest payable | 0 | (37) |
5.0% Convertible Notes | ||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Amortization of discount and deferred costs | 891 | 955 |
Change in assets and liabilities: | ||
Interest payable | (957) | (948) |
8.5% Senior Secured Notes | ||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Amortization of discount and deferred costs | 817 | 554 |
Change in assets and liabilities: | ||
Interest payable | $ 264 | $ 463 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOW (UNAUDITED) (Parenthetical) | Aug. 31, 2020 | Nov. 30, 2019 | [1] | Aug. 31, 2019 | Jul. 28, 2017 | Apr. 18, 2017 |
8.5% Convertible Notes | ||||||
Debt interest rate | 8.50% | 8.50% | ||||
5.0% Convertible Notes | ||||||
Debt interest rate | 5.00% | 5.00% | 5.00% | 5.00% | ||
8.5% Senior Secured Notes | ||||||
Debt interest rate | 8.50% | 8.50% | 8.50% | 8.50% | ||
[1] | Derived from audited consolidated financial statements. |
Description of Business
Description of Business | 9 Months Ended |
Aug. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | Description of Business Emergent Capital, Inc. was founded in December 2006 as a Florida limited liability company, Imperial Holdings, LLC, and converted into Imperial Holdings, Inc. on February 3, 2011, in connection with our initial public offering. Effective September 1, 2015, the name was changed to Emergent Capital, Inc. (with its subsidiary companies, the "Company" or "Emergent Capital"). Risks and Uncertainties The outbreak of COVID-19, which is a rapidly evolving situation, has adversely impacted global commercial activities. The Company does not believe that there is any significant impact to the Financial Statements as of August 31, 2020 as a result of the COVID-19 pandemic. The Company is monitoring the developments relating to COVID-19 and is coordinating its operational response based on existing business continuity plans and ongoing guidance from global health organizations, relevant governments, and general pandemic response best practices. Equity Investment in White Eagle Asset Portfolio Emergent Capital indirectly owns a 27.5% equity investment, having an estimated fair value of approximately $152.5 million at August 31, 2020, in White Eagle Asset Portfolio, LP ("White Eagle"), which was previously a wholly-owned subsidiary of the Company that holds a portfolio of life settlements. The Company primarily earns income through change in fair value and distributions from its equity investment in White Eagle. On August 16, 2019, the Company entered into a subscription agreement (the "Subscription Agreement") with Lamington Road Designated Activity Company (formerly known as Lamington Road Limited) ("Lamington" or "Class B Limited Partner"), White Eagle, White Eagle General Partner, LLP ( "WEGP" or "Withdrawing General Partner"), and Palomino JV, L.P. ("Palomino" or "Class A Limited Partner"), pursuant to which White Eagle sold to Palomino 72.5% of its limited partnership interests, consisting of all of the newly issued and outstanding Class A and Class D interests, and WEGP sold to an affiliate (the "Manager") of Jade Mountain Partners, LLC ("Jade Mountain"), all of its general partnership interests (collectively, the "WE Investment") for a purchase price of approximately $366.2 million and $8.0 million for the Class A and Class D interests, respectively. Pursuant to the Subscription Agreement, Lamington retained 27.5% of the limited partnership interests of White Eagle, consisting of all of the newly issued and outstanding Class B interests in exchange for all of its previously owned White Eagle limited partnership interests with a value of approximately $138.9 million on the closing date. The consummation of the transaction under the Subscription Agreement resulted in the Company being a minority owner in White Eagle, as a result the entity is treated as an equity investment. Activities for our investment in White Eagle are included in Note 11 "Investment in Limited Partnership" of the accompanying consolidated financial statements for further information. Litigation Settlement and Disposal of Life Settlement On December 4, 2019, the Company and certain of its subsidiaries entered into a Settlement Agreement and Mutual Release (the "Settlement Agreement") with Sun Life Assurance Company of Canada ("Sun Life") and Wilmington Trust, N.A. as securities intermediary ("Wilmington Trust"). Pursuant to the Settlement Agreement, 31 life insurance policies with face value totaling $163.5 million issued by Sun Life were canceled in exchange for a lump sum payment of $36.1 million. The settlement included two policies held by the Company outside of White Eagle with an aggregate face value of $12.0 million, 28 policies held by White Eagle with an aggregate face value of $141.5 million and one policy with a face value of $10.0 million in receivable for maturity for White Eagle. Of this amount, approximately $12.7 million was received by the Company, $13.4 million was paid to White Eagle and $10.0 million was paid to Wilmington Trust for the maturity receivable. With this settlement, the Company no longer directly owns any life insurance policies. Subsequent Event Sale of Imperial Life Settlements, LLC On September 15, 2020, the Company sold its wholly-owned subsidiary, Imperial Life Settlements, LLC ("ILS"), to an unrelated third party. Included in the sale were viatical and/or life settlement provider licenses, permits and authorizations issued to ILS by 12 states. In connection with the sale of ILS and such licenses, the Company voluntarily surrendered licenses issued to ILS by 17 other states. Such licenses are required in connection with the purchase of existing life settlements, but are not required for ownership of life settlements. The Company no longer acquires life settlements, and therefore does not need to maintain the licenses and their related deposits and expenses. Voluntary Petitions for Reorganization On October 15, 2020 (the "2020 Petition Date"), Emergent Capital and its wholly-owned subsidiary Red Reef Alternative Investment, LLC ("Red Reef") filed voluntary petitions for relief (the "2020 Chapter 11 Cases") under chapter 11 of title 11 of the United States Code (the "Bankruptcy Code") in the United States Bankruptcy Court for the District of Delaware (the "Bankruptcy Court"). Emergent Capital and Red Reef will continue to operate their business as "debtors-in-possession" under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and the orders of the Bankruptcy Court. On October 14, 2020, Emergent Capital entered into two substantially identical Restructuring Support Agreements (together with all exhibits and schedules thereto, the "RSAs") with certain holders of the 8.5% Senior Secured Notes and with certain holders of the 5.0% Convertible Notes (such holders collectively, the "Supporting Holders"). In the aggregate, the Supporting Holders hold at least a majority of each of the 8.5% Senior Secured Notes and the 5.0% Convertible Notes. See Note 21, "Subsequent Events", to the accompanying consolidated financial statements for further information. |
Principles of Consolidation and
Principles of Consolidation and Basis of Presentation | 9 Months Ended |
Aug. 31, 2020 | |
Accounting Policies [Abstract] | |
Principles of Consolidation and Basis of Presentation | Principles of Consolidation and Basis of Presentation The accompanying consolidated financial statements include the accounts of the Company, all of its wholly-owned subsidiary companies and its special purpose entities, with the exception of the Deconsolidated Entities (as defined below), White Eagle , an unconsolidated equity investment effective August 17, 2019, which is accounted for using fair value and Imperial Settlements Financing 2010, LLC ("ISF 2010"), an unconsolidated special purpose entity which is accounted for using the measurement alternative, which is measured at cost less impairment. The special purpose entity was to fulfill specific objectives. All significant intercompany balances and transactions, except those related to Lamington after November 13, 2018 to August 16, 2019 (see Note 4) have been eliminated in consolidation, including income from services performed by subsidiary companies in connection with the White Eagle Revolving Credit Facility, as detailed herein. The unaudited consolidated financial statements have been prepared in conformity with the rules and regulations of the SEC for Form 10-Q and therefore do not include certain information, accounting policies, and footnote disclosure information or footnotes necessary for a complete presentation of financial position, results of operations and cash flows in conformity with generally accepted accounting principles. However, all adjustments (consisting of normal recurring accruals), which, in the opinion of management, are necessary for a fair presentation of the financial statements, have been included. Operating results for the three months ended August 31, 2020 and nine months ended August 31, 2020 are not necessarily indicative of the results that may be expected for future periods or for the year ending November 30, 2020. These interim financial statements should be read in conjunction with the Consolidated Financial Statements and Notes thereto included in Emergent Capital's Report on Form 10-K for the fiscal year ended November 30, 2019. Going Concern Historically, the Company has incurred substantial losses, which has resulted in an accumulated deficit of approximately $275.4 million as of August 31, 2020. Cash flows used in operating activities were $8.6 million for the nine months ended August 31, 2020 and $8.5 million for the nine months ended August 31, 2019. As of August 31, 2020, the Company had approximately $19.1 million of cash and cash equivalents and certificates of deposit of $517,000. The Company’s ability to continue as a going concern is dependent on its ability to meet its liquidity needs through a combination of factors including but not limited to, the receipt of distributions from its investment in its equity investment in White Eagle, cash on hand and pending approval of its prenegotiated Chapter 11 reorganization plan by the Bankruptcy Court. As of the filing date of this Form 10-Q, we had approximately $19.0 million of cash and cash equivalents inclusive of certificates of deposit of $519,000. The Company's 8.5% Senior Secured Notes, which have outstanding principal of approximately $47.6 million, currently mature on July 15, 2021. In considering our forecast for the next twelve months, including the scheduled repayment of this debt, the Company does not have sufficient liquidity to meet it's obligations. Subsequent to the quarter end, the Company filed a Chapter 11 petition, including a prenegotiated reorganization plan with the support of the holders of a majority of the 8.5% Senior Secured Notes holders which plan would convert the 8.5% Senior Secured Notes into a security with a later maturity date. The plan is pending approval by the Bankruptcy Court. These facts create a substantial doubt of the Company’s ability to meet its financial needs and continue as a going concern. During the bankruptcy process, management plans to continue to operate our business in accordance with the applicable provisions of the Bankruptcy Code and the orders of the Bankruptcy Court. See Note 21, "Subsequent Events", to the accompanying consolidated financial statements for further information. The accompanying consolidated financial statements are prepared on a going concern basis and do not include any adjustments that might result from uncertainty about the Company’s ability to continue as a going concern. Reorganization and Consolidation On November 14, 2018 (the "Petition Date"), Lamington and WEGP filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware (the "Bankruptcy Court"). Lamington was the limited partner and owned 99.99%, and WEGP was the general partner and owned 0.01%, of White Eagle. In its capacity as general partner, WEGP managed the affairs of White Eagle. Lamington and its subsidiaries' (White Eagle and WEGP) filing of the Chapter 11 Cases was a reconsideration event for Emergent Capital to reevaluate whether consolidation of Lamington and its subsidiaries (White Eagle, WEGP and Lamington Road Bermuda Limited) (collectively, and with Lamington, the "Deconsolidated Entities") continued to be appropriate. Under ASC 810, Consolidation , specifically ASC 810-10-15, consolidation of a majority-owned subsidiary is precluded where control does not rest with the majority owners, for instance, where the subsidiary is in legal reorganization or bankruptcy. Accordingly, when a subsidiary files for bankruptcy, it is appropriate for the parent to deconsolidate the subsidiary. Under ASC 810, this loss of control would likely trigger a gain or loss for the parent as the parent would remeasure its retained noncontrolling investment at fair value. We assessed the inherent uncertainties associated with the outcome of the Chapter 11 reorganization process and the anticipated duration thereof, and concluded that it was appropriate to deconsolidate Lamington and its subsidiaries effective on the Petition Date. On June 19, 2019, the Bankruptcy Court entered an order confirming the Plan of Reorganization for the Chapter 11 Cases. The Plan of Reorganization implemented the Settlement Agreement and the DIP Financing. In addition, the Plan of Reorganization provided for the payment of all other allowed third party creditor claims in full, including allowed professional fees and taxes. The effective date of the Plan of Reorganization was June 19, 2019. On August 16, 2019, the White Eagle Revolving Credit Facility was paid in full and terminated, and additionally, payment was made to all White Eagle vendors and intercompany liabilities were contributed by Emergent. Lamington and WEGP had pledged their respective interests in White Eagle to secure its obligations under the White Eagle Revolving Credit Facility. With the termination of the facility, this pledge was released. There were no outstanding third party liabilities for either Lamington or WEGP at August 16, 2019 besides intercompany obligations to Emergent. Pursuant to ASC 810, Consolidation , management took the position that given that all third party claims had been satisfied in the case, consolidation of Lamington and WEGP as of August 17, 2019 was appropriate. However, the consummation of the transaction pursuant to the Subscription Agreement resulted in the Company being a minority owner in White Eagle. Accordingly, White Eagle was not reconsolidated but rather treated as an equity investment. On September 16, 2019, the Bankruptcy Court entered an order and a final decree closing the White Eagle Chapter 11 Case and the Lamington WEGP cases were closed on November 25, 2019. Related Party Relationship Upon filing for Chapter 11 and the subsequent deconsolidation, transactions with Lamington were no longer eliminated in consolidation and are treated as related party transactions for Emergent Capital. On August 17, 2019 Lamington was reconsolidated and its transactions are eliminated in consolidation. See Note 5 "Condensed and Consolidated Financial Statements For Entities in Bankruptcy" for all transactions between Emergent Capital and Lamington while Lamington was deconsolidated. Discontinued Operations On October 25, 2013, the Company sold substantially all of the assets comprising its structured settlement business. As a result, the Company has discontinued segment reporting and classified its operating results of the structured settlement business, net of income taxes, as discontinued operations. The accompanying consolidated statements of operations for the three months and nine months ended August 31, 2020 and August 31, 2019, and the related notes to the consolidated financial statements, reflect the classification of its structured settlement business operating results, net of tax, as discontinued operations. See Note 9, "Discontinued Operations," of the accompanying consolidated financial statements for further information. Unless otherwise noted, the following notes refer to the Company’s continuing operations. Foreign Currency The Company owns certain foreign subsidiary companies formed under the laws of Ireland, the Bahamas and Bermuda. These foreign subsidiary companies utilize the U.S. dollar as their functional currency. The foreign subsidiary companies' financial statements are denominated in U.S. dollars and therefore, there are no translation gains and losses resulting from translating the financial statements at exchange rates other than the functional currency. Any gains and losses resulting from foreign currency transactions (transactions denominated in a currency other than the subsidiary companies' functional currency) are included in income. These gains and losses are immaterial to the Company’s financial statements. Use of Estimates The preparation of consolidated financial statements, in conformity with accounting principles generally accepted in the United States of America ("GAAP"), requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from these estimates and such differences could be material. Significant estimates made by management include income taxes, the valuation of life settlements, the valuation of equity awards and the valuation of our investment in limited partnership. Reclassifications Certain reclassifications of the prior period amounts and presentation have been made to conform to the presentation for the current period. These reclassifications relate primarily to change in fair value of investment in deconsolidated subsidiaries and sublease income. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 9 Months Ended |
Aug. 31, 2020 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In August 2018, the FASB issued ASU 2018-13, "Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement" which modifies the disclosure requirements on fair value measurements in Topic 820, Fair Value Measurement, based on the concepts in the Concepts Statement, including the consideration of costs and benefits. The following disclosure requirements were removed from Topic 820 among others: 1) The amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy 2) The policy for timing of transfers between levels. The following disclosure requirements were part of the modifications in Topic 820:1) For investments in certain entities that calculate net asset value, an entity is required to disclose the timing of liquidation of an investee’s assets and the date when restrictions from redemption might lapse only if the investee has communicated the timing to the entity or announced the timing publicly. The amendments also clarify that the measurement uncertainty disclosure is to communicate information about the uncertainty in measurement as of the reporting date. Lastly, the following disclosure requirements were added to Topic 820:1) the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period; 2) the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. For certain unobservable inputs, an entity may disclose other quantitative information (such as the median or arithmetic average) in lieu of the weighted average if the entity determines that other quantitative information would be a more reasonable and rational method to reflect the distribution of unobservable inputs used to develop Level 3 fair value measurements. The amendments in this Update are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. We are currently evaluating the methods and impact of adopting this new standard on our consolidated financial statements. In October 2018, the FASB issued ASU No. 2018-17, Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities ("ASU 2018-17"). ASU 2018-17 provides that indirect interests held through related parties in common control arrangements should be considered on a proportional basis for determining whether fees paid to decision makers and service providers are variable interests. ASU 2018-17 is effective for public companies for annual and interim periods beginning after December 15, 2019, with early adoption permitted. We are currently evaluating the methods and impact of adopting this new standard on our consolidated financial statements. In May 2019, the FASB issued ASU No. 2019- 05 which amends ASU 2016-13 to allow companies to irrevocably elect, upon adoption of ASU 2016-13, the fair value option on financial instruments that (1) were previously recorded at amortized cost and (2) are within the scope of ASC 326-203 if the instruments are eligible for the fair value option under ASC 825-10.4 The fair value option election does not apply to held-to-maturity debt securities. Entities are required to make this election on an instrument-by-instrument basis. ASU 2019-05’s amendments should be applied "on a modified-retrospective basis by means of a cumulative-effect adjustment to the opening balance of retained earnings balance in the statement of financial position as of the date that an entity adopted the amendments in ASU 2016-13." Certain disclosures are required. For entities that have adopted ASU 2016-13, the amendments in ASU 2019-05 are effective for fiscal years beginning after December 15, 2019, including interim periods therein. An entity may early adopt the ASU in any interim period after its issuance if the entity has adopted ASU 2016-13. For all other entities, the effective date will be the same as the effective date in ASU 2016-13.We are currently evaluating the methods and impact of adopting this new standard on our consolidated financial statements. In May 2019, the FASB issued ASU No 2019-04 which clarifies certain aspects of accounting for credit losses, hedging activities, and financial instruments. The ASU’s amendments apply to all entities within the scope of the affected guidance. Accrued interest - Amortized cost basis is defined in ASU 2016-13 as "the amount at which a financing receivable or investment is originated or acquired, adjusted for applicable accrued interest, accretion or amortization of premium, discount, and net deferred fees or costs, collection of cash, write offs, foreign exchange, and fair value hedge accounting adjustments". To address stakeholders’ concerns that the inclusion of accrued interest in the definition of amortized cost basis could make application of the credit loss guidance operationally burdensome, ASU 2019-04 provides certain alternatives for the measurement of the allowance for credit losses (ALL) on accrued interest receivable (AIR). These measurement alternatives include (1) measuring an ALL on AIR separately, (2) electing to provide separate disclosure of the AIR component of amortized cost as a practical expedient, and (3) making accounting policy elections to simplify certain aspects of the presentation and measurement of such AIR. For entities that have adopted ASU 2016-13, the amendments in ASU 2019-04 related to ASU 2016-13 are effective for fiscal years beginning after December 15, 2019, and interim periods therein. ASU 2019-04’s amendments should be applied "on a modified-retrospective basis by means of a cumulative-effect adjustment to the opening retained earnings balance in the statement of financial position as of the date an entity adopted the amendments in ASU 2016-13." Certain disclosures are also required. For all other entities, the effective date will be the same as the effective date in ASU 2016-13. We are currently evaluating the methods and impact of adopting this new standard on our consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740) - Simplifying the Accounting for Income Taxes. The ASU enhances and simplifies various aspects of the income tax accounting guidance in ASC 740, including requirements related to the following: (1) hybrid tax regimes; (2) tax basis step-up in goodwill obtained in a transaction that is not a business combination; (3) separate financial statements of entities not subject to tax; (4) intra-period tax allocation exception to the incremental approach; (5) ownership changes in investments; (6) interim-period accounting for enacted changes in tax law; (7) year-to-date loss limitation in interim-period tax accounting. The amendments in ASU 2019-12 are effective for public business entities for fiscal years beginning after December 15, 2020, including interim periods therein. Early adoption of the standard is permitted, including adoption in interim or annual periods for which financial statements have not yet been issued. We are currently evaluating the methods and impact of adopting this new standard on our consolidated financial statements. In January 2020, the FASB issued ASU 2020-01, Clarifying the Interactions between Topic 321, Topic 323, and Topic 815. The amendments in this Update clarify certain interactions between the guidance to account for certain equity securities under Topic 321, the guidance to account for investments under the equity method of accounting in Topic 323, and the guidance in Topic 815, which could change how an entity accounts for an equity security under the measurement alternative or a forward contract or purchased option to purchase securities that, upon settlement of the forward contract or exercise of the purchased option, would be accounted for under the equity method of accounting or the fair value option in accordance with Topic 825, Financial Instruments. These amendments improve current GAAP by reducing diversity in practice and increasing comparability of the accounting for these interactions. For public business entities, the amendments in this Update are effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. Early adoption is permitted, including early adoption in an interim period, (1) for public business entities for periods for which financial statements have not yet been issued and (2) for all other entities for periods for which financial statements have not yet been made available for issuance. The amendments in this Update should be applied prospectively. Under a prospective transition, an entity should apply the amendments at the beginning of the interim period that includes the adoption date. We are currently evaluating the methods and impact of adopting this new standard on our consolidated financial statements. In June 2020, the FASB issued ASU 2020-06 which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity. ASU 2020-06 also amends certain guidance in ASC 260 on the computation of EPS for convertible instruments and contracts on an entity’s own equity. Under ASU 2020-06, entities must apply the if-converted method to all convertible instruments because the treasury stock method will no longer be available. In instances where the principal amount must be paid in cash and only the conversion spread is settled in shares, the if-converted method is modified so that interest expense is not added back to the numerator, and the denominator only includes the net number of incremental shares that would be issued upon conversion. ASU 2020-06 clarifies that the "average market price should be used to calculate the diluted EPS denominator" when the exercise price or the number of shares that may be issued is variable, except for certain contingently issuable shares. For public business entities that are not smaller reporting companies, the amendments in this update are effective for fiscal years beginning after December 15, 2021, and interim periods within those fiscal years. For all other entities, the guidance will be effective for the fiscal years beginning after December 15, 2023, and interim periods within those fiscal years. The guidance may be early adopted for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. We are currently evaluating the methods and impact of adopting this new standard on our consolidated financial statements. Adopted Accounting Pronouncements Change in Accounting Principle and Accounting for Lease The Company adopted ASU No. 2016-02, Leases (Topic 842) which now requires recognition of right-of-use (ROU) asset and lease liability on the balance sheet. As part of the transition to the new standard, the Company measured its operating lease commitment at December 1, 2019 and recognized a right-of-use asset and operating lease liability on its balance sheet. The adoption of this ASU did not result in any significant changes to the consolidated statements of operations, stockholders' equity, or statement of cash flows. In transitioning the application of this guidance, retrospective application to all periods presented in the consolidated financial statements has been performed as follows (in thousands): As reported under previous accounting guidance As reported under ASU 2016-02 Effect of change Balance Sheet - November 30, 2019 Assets Prepaid and other assets $ 377 $ 353 $ 24 Operating lease assets — 132 132 Total assets $ 165,712 $ 165,868 $ 156 Liabilities Other liabilities $ 86 $ 39 $ (47) Operating lease liability — 203 203 Total liabilities 123,599 123,755 156 Total stockholders' equity 42,113 42,113 — Total liabilities and stockholders' equity $ 165,712 $ 165,868 $ 156 Net effect $ — $ — $ — In February 2018, the FASB issued ASU 2018-02, "Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income" to address stakeholder concerns about the guidance in current generally accepted accounting principles (GAAP) that requires deferred tax liabilities and assets |
Deconsolidation of Subsidiaries
Deconsolidation of Subsidiaries | 9 Months Ended |
Aug. 31, 2020 | |
Reorganizations [Abstract] | |
Deconsolidation of Subsidiaries | Deconsolidation of Subsidiaries On the Petition Date, Lamington and WEGP filed the November Chapter 11 Cases in the Bankruptcy Court. As of such date, Lamington was the limited partner and owned 99.99%, and WEGP was the general partner and owned 0.01%, of White Eagle. In its capacity as general partner, WEGP managed the affairs of White Eagle. Lamington and WEGP continued to operate their businesses as "debtors-in-possession" under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and orders of the Bankruptcy Court. Emergent Capital (exclusive of its subsidiaries) is a separate entity, and did not file for bankruptcy relief and continues to operate in the ordinary course. The Deconsolidated Entities' financial results are included in the Company’s consolidated results through November 13, 2018, the day prior the Petition Date. However, under ASC 810, Consolidation , specifically ASC 810-10-15, consolidation of a majority-owned subsidiary is precluded where control does not rest with the majority owners, for instance, where the subsidiary is in legal reorganization or bankruptcy. Accordingly, when a subsidiary files for bankruptcy, it is appropriate for the parent to deconsolidate the subsidiary. Under ASC 810, this loss of control would likely trigger a gain or loss for the parent as the parent would remeasure its retained noncontrolling investment at fair value. We assessed the inherent uncertainties associated with the outcome of the Chapter 11 reorganization process and the anticipated duration thereof, and concluded that it was appropriate to deconsolidate Lamington and its subsidiaries effective on the Petition Date. ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities was effective for calendar year-end public business entities in 2018. Under the new guidance, a reporting entity should account for its equity investments that are not consolidated or accounted for under the equity method at fair value, with changes to fair value recorded in current earnings. Lamington's main subsidiary, White Eagle, carries its life settlements policies and debt under the White Eagle Revolving Credit Facility at fair value, these valuations are based on inputs that are both significant to the fair value measurement and unobservable. As a result, the Company adopted ASU 2016-01 to value its investment in Lamington. The calculation was performed consistent with ASC 820 with changes in fair value recorded in current earnings. On August 16, 2019, the White Eagle Revolving Credit Facility was paid in full and terminated. In addition, payment was made to all White Eagle vendors and intercompany liabilities were contributed by Emergent. Lamington and WEGP had pledged their respective interests in White Eagle to secure its obligations under the White Eagle Revolving Credit Facility. With the termination of the facility, this pledge was released. There were no outstanding third party liabilities for either Lamington or WEGP at August 16, 2019 besides intercompany obligations. On September 16, 2019, the Bankruptcy Court entered an order and a final decree closing the White Eagle Chapter 11 Case and the Lamington and WEGP cases were closed on November 25, 2019. However pursuant to ASC 810, Consolidation , management took the position that given that all third party claims had been satisfied in the case, consolidation of Lamington and WEGP as of August 17, 2019 was appropriate. Effective August 17, 2019, Lamington and WEGP are no longer deconsolidated. The fair value of the investment in Lamington at August 16, 2019 was calculated as follows: Investment in Lamington at December 1, 2018 $ 128,795 Less: Change in fair value 37,941 Investment in Lamington at August 16, 2019 $ 166,736 The table below summarizes the composition of the Company's investment in the deconsolidated entities at August 31, 2019: Change in Fair Value November 30, 2018 December 1, 2018 to August 16, 2019 August 31, 2019 Equity investment $ 66,251 $ (45,847) $ 20,404 Promissory notes 56,596 89,736 146,332 Other liabilities 5,948 (5,948) — Total investment $ 128,795 $ 37,941 $ 166,736 |
Condensed and Consolidated Fina
Condensed and Consolidated Financial Statements for Entities in Bankruptcy | 9 Months Ended |
Aug. 31, 2020 | |
Condensed Financial Information of Debtor-in-Possession Disclosure [Abstract] | |
Condensed and Consolidated Financial Statements for Entities in Bankruptcy | Condensed and Consolidated Financial Statements for Entities in Bankruptcy Condensed consolidated financial information for Lamington Road DAC is set forth below, presented at historical cost basis. Lamington Road DAC (Debtor-in-Possession) Condensed and Consolidated Statements of Operations Three Months Ended Three Months Ended Nine Months Ended August 31, Nine Months Ended August 31, 2020 2019 2020 2019 Change in fair value of life settlements (Notes 11 & 16) $ — $ 12,985 $ — $ (16,841) Change in fair value of investment in limited partnership (Note 10 &15) — 15,352 — 15,352 Realized Gain on Life Settlements, Net — 21,336 — 21,336 Other income — 345 — 709 Total income — 50,018 — 20,556 Interest expense — 23,331 — 28,331 Change in fair value of White Eagle Revolving Credit Facility (Notes 12 & 16) — (26,586) — 17,094 Loss on extinguishment of debt — 7,360 — 7,360 Reorganization cost — 4,769 — 13,954 Legal fees — 158 — 890 Professional fees — 659 — 1,549 Administrative service fees - affiliate — — — 2,765 Other general and administrative expenses — (71) — 469 Total expenses — 9,620 — 72,412 Income taxes — — — — (Loss) income $ — $ 40,398 $ — $ (51,856) Lamington Road DAC (Debtor-in-Possession) Condensed and Consolidated Statements of Cash Flows Nine Months Ended August 31, Nine Months Ended August 31, 2020 2019 Net cash used in operating activities $ — $ (58,793) Cash flows from investing activities Premiums paid on life settlements — (69,827) Proceeds from maturity of life settlements — 92,505 Net cash provided by/(used in) investing activities $ — $ 22,678 Cash flows from financing activities Repayment of borrowings under White Eagle Revolving Credit Facility — (1,804) Borrowings from White Eagle Revolving Credit Facility — 4,221 Cash distributed to Parent Company — (21) Net cash provided by financing activities $ — $ 2,396 Net increase (decrease) in cash and cash equivalents — (33,719) Cash and cash equivalents, at beginning of the period — 33,719 Cash and cash equivalents, at end of the period $ — $ — Supplemental disclosures of cash flow information: Cash paid for interest during the period $ — $ 28,331 Supplemental disclosures of non-cash financing activities: Repayment of White Eagle Revolving Credit Facility by third party from proceeds of sale of life settlement $ — $ 366,821 White Eagle early extinguishment fees paid by third party from proceeds of Class D Shares $ — $ 7,360 Related Party Transactions Certain related party transactions had been eliminated in consolidation. Due to the deconsolidation of Lamington, transactions after November 13, 2018 were no longer eliminated until the discharge of the Chapter 11 Cases, effective August 17, 2019 after which related party transactions are again eliminated in consolidation. The below is a description of related party transactions for the period. Administrative Services Fees In 2014, White Eagle entered into an Administrative Service Agreement with Imperial Finance and Trading ("IFT"). Under the agreement, IFT will perform certain non-discretionary, administrative or ministerial services to assist with certain reporting, compliance and document retention duties and obligations arising under or in connection with the Amended and Restated Loan and Securities Agreement. IFT shall recover all cost incurred in performing these services, with billings quarterly or annually. Bills will be based on actual cost or an appropriate allocation methodology. White Eagle incurred post-petition administrative service expenses of approximately $0 and $2.8 million during the nine months ended August 31, 2020 and 2019, respectively. Amounts due from White Eagle resulting from the administrative services during nine months ended August 31, 2019 were contributed on August 16, 2019 consistent with the Master Termination Agreement. Promissory Notes Receivables Effective May 16, 2014, Lamington entered into a 10 year, $59.3 million unsecured Promissory Note ("the 8.5% Promissory Note") in favor of its parent company, Markley Asset Portfolio, LLC ("Markley"). The amount was used by Lamington as the partial purchase price of Markley’s interest in White Eagle. The annual interest rate on the Promissory Note is 8.5% and is due to be paid at the end of each calendar year; provided that any interest accrued at the end of a calendar year which is not paid within seven Effective July 28, 2017, Lamington issued an unsecured Promissory Note to Markley, in a principal amount of $57.0 million. The amount represents distributions of earnings from Lamington's share of profits of White Eagle, to satisfy Profit Participating Notes issued by Markley to Lamington (the "Special Dividend Note").The Special Dividend Note matures on July 28, 2027 and bears interest at an annual rate of 5.0% provided that any interest accrued at the end of a calendar year which is not paid within seven At August 16, 2019, the notes were fair valued in accordance with ASC 820, with a fair value of approximately $146.3 million, resulting in a change in fair value of approximately $89.7 million for the period up to August 16, 2019, which is included in change in fair value of investment in deconsolidated subsidiaries. The Company stopped accruing interest on both notes during the Chapter 11 cases, effective August 17, 2019 the notes are consolidated, and interest expense has been eliminated on consolidation. |
Consolidation of Variable Inter
Consolidation of Variable Interest Entities | 9 Months Ended |
Aug. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Consolidation of Variable Interest Entities | Consolidation of Variable Interest Entities The Company evaluates its interests in variable interest entities ("VIEs") on an ongoing basis and consolidates those VIEs in which it has a controlling financial interest and is thus deemed to be the primary beneficiary. A controlling financial interest has both of the following characteristics: (i) the power to direct the activities of the VIE that most significantly impact its economic performance; and (ii) the obligation to absorb losses of the VIE that could potentially be significant to it or the right to receive benefits from the VIE that could be potentially significant to the VIE. The following table presents the consolidated assets and consolidated liabilities of VIEs for which the Company has concluded that it is the primary beneficiary and which are consolidated in the Company’s financial statements as of August 31, 2020 and November 30, 2019, as well as non-consolidated VIEs for which the Company has determined it is not the primary beneficiary (in thousands): Not Primary Not Primary Non-consolidated VIE Non-consolidated VIE- White Eagle Total Maximum Total Maximum August 31, 2020 $ — $ — $ 152,450 $ 152,450 November 30, 2019 $ — $ — $ 137,849 $ 137,849 Imperial Settlements Financing 2010, LLC ("ISF 2010"), which was formed as an affiliate of the Company to serve as a special purpose financing entity to allow the Company to sell structured settlements and assignable annuities, it is a non-consolidated special purpose financing entity, as well as a non-consolidated VIE for which the Company has determined it is not the primary beneficiary. During the twelve months ended November 30, 2019, the investment was fully written off and the Company incurred change in fair value loss on its investment in affiliates of approximately $2.4 million, the amount is included in loss from discounted operations. This investment was held by our structured settlement subsidiary whose activities were discontinued in 2013 with the sale of the structured settlement assets and the amount was written off as part of the restructuring transactions of the Company. See Note 9, "Discontinued Operations," of the accompanying consolidated financial statements for further information. In connection with the WE Investment, the Limited Partnership Agreement of White Eagle was amended and restated (the "A&R LPA") to provide for the issuance of the Class A, B and D limited partnership interests, and for funding of an "Advance Facility" evidenced by the Class D limited partnership interests, to maintain reserves sufficient to fund premiums, certain operating expenses of White Eagle and certain minimum payments to Lamington as the holder of the Class B interests. The A&R LPA provides generally that the Class A and Class B Interests receive distributions of proceeds of the assets of White Eagle based on their 72.5% and 27.5% ownership. The limited partnership is a non-consolidated VIE for which the Company has determined it is not the primary beneficiary. The Company accounts for its equity investment at fair value with changes in fair included in current earnings. Approximately $152.5 million is included as investment in limited partnership in the accompanying consolidated balance sheet as of August 31, 2020. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Aug. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share As of August 31, 2020 and 2019, there were 159,263,140 and 158,659,803 shares of common stock issued, respectively, and 158,655,140 and 158,051,803 shares of common stock outstanding, respectively. Outstanding shares as of August 31, 2020 and 2019 have been adjusted to reflect 608,000 treasury shares. Basic net income per share is computed by dividing the net earnings attributable to common shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income attributable to common shareholders by the weighted average number of common shares outstanding, increased to include the number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued. Conversion or exercise of the potential common shares is not reflected in diluted earnings per share unless the effect is dilutive. The dilutive effect, if any, of outstanding common share equivalents is reflected in diluted earnings per share by application of the treasury stock method, and if-converted method as applicable. The following table reconciles actual basic and diluted earnings per share for the three months and nine months ended August 31, 2020 and 2019 (in thousands except per share data). Three Months Ended August 31, Nine Months Ended August 31, 2020(1) 2019(2) 2020(3) 2019(4) Income (loss) per share: Numerator: Net income (loss) from continuing operations $ (1,028) $ 80,201 $ 16,127 $ 16,875 Net income (loss) from discontinued operations — 70 (53) 36 Numerator for basic EPS - net income (loss) attributable to common stockholders $ (1,028) $ 80,271 $ 16,074 $ 16,911 Add back convertible notes interest — 1,095 2,996 3,270 Numerator for diluted earnings per share - net income (loss) attributable to common stockholders $ (1,028) $ 81,296 $ 19,123 $ 20,145 Basic income (loss) per common share: Basic income (loss) from continuing operations $ (0.01) $ 0.51 $ 0.10 $ 0.11 Basic income (loss) from discontinued operations — — — — Basic income (loss) per share available to common shareholders $ (0.01) $ 0.51 $ 0.10 $ 0.11 Diluted income (loss) per common share: Diluted income (loss) from continuing operations $ (0.01) $ 0.41 $ 0.09 $ 0.10 Diluted income (loss) from discontinued operations — — — — Diluted income (loss) per share available to common shareholders $ (0.01) $ 0.41 $ 0.09 $ 0.10 Denominator: Basic 157,655,140 156,968,470 157,624,241 156,949,425 Diluted 157,655,140 195,979,957 206,696,703 194,867,908 (1) The computation of diluted EPS does not include 100,000 shares underlying stock appreciation rights, 1,000,000 shares of restricted stock, 42,500,000 shares of common stock underlying warrants and 33,918,483 shares of common stock issuable upon conversion of the 5% Convertible Notes as the effect of their inclusion would have been anti-dilutive. (2) The computation of diluted EPS does not include 85,000 shares of common stock underlying options, 100,000 shares of stock appreciation rights and 2,000,000 shares of common stock underlying warrants, as the effect of their inclusion would have been anti-dilutive. (3) The computation of diluted EPS does not include 100,000 shares underlying stock appreciation rights as the effect of their inclusion would have been anti-dilutive. (4) The computation of diluted EPS does not include 85,000 shares of common stock underlying options, 100,000 shares of stock appreciation rights, 1,083,333 shares of restricted stock and 44,500,000 shares of common stock underlying warrants, as the effect of their inclusion would have been anti-dilutive. |
Stock-based Compensation
Stock-based Compensation | 9 Months Ended |
Aug. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock-based Compensation | Stock-based Compensation On June 27, 2017, the shareholders of the Company voted to amend, and the Company amended, the Amended and Restated 2010 Omnibus Incentive Plan (as amended, the "Omnibus Plan") to increase the number of shares authorized for issuance thereunder by 9,900,000 shares. Awards under the Omnibus Plan may consist of incentive awards, stock options, stock appreciation rights, performance shares, performance units, and shares of common stock, restricted stock, restricted stock units or other stock-based awards as determined by the compensation committee of the Company's board of directors. The Omnibus Plan has an aggregate of 12,600,000 shares of common stock authorized for issuance thereunder, subject to adjustment as provided therein. Options As of November 30, 2019, all options to purchase shares of common stock issued by the Company were fully vested with 85,000 exercisable. There was no stock-based compensation expense relating to stock options granted under the Omnibus Plan during the three months and nine months ended August 31, 2020 and August 31, 2019, respectively. During the three months ended August 31, 2020, options to purchase 85,000 shares of common stock under the Omnibus Plan expired. The options were issued on June 6, 2013 and expired seven years after the date of grant which was June 6, 2020. The following table presents the activity of the Company’s stock options for the nine months ended August 31, 2020: Common Stock Options Number of Weighted Weighted Aggregate Outstanding Balance, December 1, 2019 85,000 $ 6.94 0.56 $ — Options granted — — — Options exercised — — — Options forfeited — $ — — Options expired (85,000) 6.94 — Options outstanding, August 31, 2020 — $ — — $ — Exercisable at August 31, 2020 — $ — — Unvested at August 31, 2020 — — — $ — Restricted Stock The Company incurred stock-based compensation expense of approximately $21,000 and $95,000 relating to restricted stock granted to certain employees during the three months ended August 31, 2020 and 2019, respectively, and $74,000 and $290,000 during the nine months ended August 31, 2020 and 2019, respectively. During the year ended December 31, 2017, the Company granted 2,000,000 shares of restricted stock units to certain employees under the Omnibus Plan, which are subject to a two year vesting period that commenced on the date of grant. The fair value of the unvested restricted stock was valued at approximately $745,000 based on the closing price of the Company's shares on the day prior to the grant date. Approximately 750,000 shares of restricted stock vested during the eleven months ended November 30, 2018, 1,000,000 during the during the twelve months ended November 30, 2019 and 250,000 during the nine months ended August 31, 2020 with 0 unvested at August 31, 2020. The Company incurred stock-based compensation expense of approximately $0 and $89,000 during the three months ended August 31, 2020 and 2019, respectively, with $0 and $271,000 during the nine months ended August 31, 2020 and 2019, respectively, related to these 2,000,000 shares of restricted stock. During the eleven months ended November 30, 2018, the Company granted 150,000 shares of restricted stock units to certain employees under the Omnibus Plan, with 100,000 shares and 50,000 subject to a two During the nine months ended August 31, 2020, the Company, granted 1,000,000 shares of restricted common stock to its Chief Executive Officer, vesting in thirds upon the first three The following table presents the activity of the Company’s unvested shares of restricted stock for the three months ended August 31, 2020: Common Unvested Shares Number of Outstanding Balance, December 1, 2019 333,333 Granted 1,000,000 Vested (333,333) Forfeited — Outstanding August 31, 2020 1,000,000 The aggregate intrinsic value of the award of these 1,000,000 shares is $340,000 and the remaining weighted average life of these awards is 2.41 years as of August 31, 2020. As of August 31, 2020, a total of $200,000 in stock based compensation remained unrecognized. Stock Appreciation Rights (SARs) During the twelve months ended November 30, 2018, the Company issued 100,000 SARs to the sole non-employee member of the ad hoc Capital Structure Committee of the Board, which will expire 10 years after the date the SARs were granted. The SARs will vest on the later of (i) September 30, 2018 and (ii) termination of the director's service on the Committee and had a fair value of $9,000 on the grant date. Each SAR entitles the holder to receive, upon exercise, an amount equal to the excess of (a) the fair market value per share of stock on the exercise date, over (b) the exercise price, which is $1.00, being not less than the fair market value per share of stock on the grant date. Upon exercise of the SARs, the stock appreciation amount shall be paid, as determined solely at the discretion of the Company, in (a) whole shares, (b) cash, or (c) a combination of both cash and shares. The 100,000 SARs vested during the eleven months November 30, 2018 and remain unexercised at August 31, 2020. |
Discontinued Operations
Discontinued Operations | 9 Months Ended |
Aug. 31, 2020 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | Discontinued Operations On October 25, 2013, the Company sold substantially all of the operating assets comprising its structured settlement business to Majestic Opco LLC pursuant to an Asset Purchase Agreement. No structured settlement receivables were sold and no on-balance sheet liabilities were transferred in connection with the sale. On August 18, 2015, the Company sold its remaining structured settlement receivables asset to the buyer of its operating assets. As a result of the sale of its structured settlements business, the Company reclassified its structured settlement business operating results as discontinued operations in the accompanying Consolidated Statements of Operations for all periods presented. Operating results related to the Company’s discontinued structured settlement business are as follows: Three Months Ended Nine Months Ended 2020 2019 2020 2019 (in thousands) Total income $ — $ — $ — $ — Total expenses — (70) 53 (36) Income (loss) before income taxes — 70 (53) 36 (Benefit) provision for income taxes — — — — Net income (loss) from discontinued operations, net of income taxes $ — $ 70 $ (53) $ 36 |
Life Settlements (Life Insuranc
Life Settlements (Life Insurance Policies) | 9 Months Ended |
Aug. 31, 2020 | |
Investments, All Other Investments [Abstract] | |
Life Settlements (Life Insurance Policies) | Life Settlements (Life Insurance Policies) The Company accounts for policies it acquires using the fair value method in accordance with ASC 325-30-50 Investments-Other-Investment in Insurance Contracts . Under the fair value method, the Company recognizes the initial investment at the purchase price. For policies that were relinquished in satisfaction of premium finance loans at maturity, the initial investment is the loan carrying value. For policies purchased in the secondary or tertiary markets, the initial investment is the amount of cash outlay at the time of purchase. At each reporting period, the Company re-measures the investment at fair value in its entirety and recognizes changes in the Statements of Operations in the periods in which the changes occur. At August 31, 2020 and November 30, 2019, the Company, through its subsidiaries, owns zero and two life insurance policies, also referred to as life settlements, with a fair value of $0 and $1.3 million, respectively and an aggregate death benefit of approximately $0 and $12.0 million, respectively. On December 4, 2019 the Company and certain of its subsidiaries entered into a Settlement Agreement and Mutual Release (the "Settlement Agreement") with Sun Life Assurance Company of Canada ("Sun Life") and Wilmington Trust, N.A. as securities intermediary ("Wilmington Trust"). Pursuant to the Settlement Agreement, 31 life insurance policies with face totaling $163.5 million issued by Sun Life were canceled in exchange for a lump sum payment of $36.1 million. The settlement included two policies held by the Company outside of White Eagle with an aggregate face value of $12.0 million, 28 policies held by White Eagle with an aggregate face value of $141.5 million and one policy with a face value of $10.0 million in receivable for maturity for White Eagle. Of this amount, approximately $12.7 million was received by the Company, $13.4 million was paid to White Eagle and $10.0 million was paid to Wilmington Trust for the maturity receivable. With this settlement, the Company no longer owns any life insurance policies. Of the $12.7 million received by the Company, approximately $2.0 million was allocated to the two policies that were owned by the Company outside of White Eagle, which resulted in a gain on disposal of approximately $743,000, with approximately $10.6 million allocated to other income as settlement of legal fees previously incurred. The weighted average life expectancy calculated based on death benefit of insureds in the policies owned by the Company at November 30, 2019 was 11.4 years. Remaining Life Expectancy (In Years)* Number of Life Settlement Contracts Fair Value Face Value 0-1 — $ — $ — 1-2 — — — 2-3 — — — 3-4 — — — 4-5 — — — Thereafter 2 1,297 12,000 Total 2 $ 1,297 $ 12,000 |
Investment in Limited Partnersh
Investment in Limited Partnership | 9 Months Ended |
Aug. 31, 2020 | |
Investments in and Advances to Affiliates [Abstract] | |
Investment in Limited Partnership | Investment in Limited Partnership Subscription Agreement On August 16, 2019 (the "Effective Date"), the Company entered into a subscription agreement (the "Subscription Agreement") with Lamington ("Class B Limited Partner"), White Eagle, WEGP ("Withdrawing General Partner"), and Palomino JV, L.P. ("Palomino" or "Class A Limited Partner") pursuant to which White Eagle sold to Palomino 72.5% of its limited partnership interests, consisting of all of the newly issued and outstanding Class A and Class D interests, and WEGP sold to an affiliate (the "Manager") of Jade Mountain Partners, LLC ("Jade Mountain") all of its general partnership interests (collectively, the "WE Investment"). Pursuant to the Subscription Agreement, Lamington retained 27.5% of the limited partnership interests of White Eagle, consisting of all of the newly issued and outstanding Class B interests in exchange for all of its previously owned White Eagle limited partnership interests. The proceeds of the WE Investment and certain funds then held in accounts of White Eagle were used to satisfy in full (i) the White Eagle Revolving Credit Facility and (ii) the DIP Financing, each in connection with the termination of the White Eagle Revolving Credit Facility and the release of the related liens on the collateral thereunder pursuant to the Master Termination Agreement. The repayment and termination of the White Eagle Revolving Credit Facility and the termination of the DIP Financing, which had not been drawn against, were in accordance with the Plan of Reorganization. The WE Investment was consummated, and the White Eagle Revolving Credit Facility was paid off in full and terminated, on August 16, 2019. The payoff totaled $402.5 million, which included payment directly to CLMG by Palomino of $374.2 million and payment to CLMG by White Eagle of $28.3 million, collectively sufficient to repay, under the White Eagle Revolving Credit Facility, the outstanding principal of $368.0 million, accrued and unpaid interest of $21.3 million plus, under the Plan of Reorganization, an early payment amount due to LNV of $7.4 million and lender allowed claims of $5.8 million. Of the $374.2 million purchase price, $8.0 million was allocated to the Class D interests which amount is to be repaid in accordance with the distribution terms of the A&R LPA. On August 16, 2019, Lamington also entered into (i) the Pledge Agreement pursuant to which it pledged the 27.5% limited partnership interests of White Eagle owned by it to Palomino and certain other secured parties in support of the payment and indemnification obligations described above, and (ii) the Assumption Agreement pursuant to which Lamington assumed all liabilities and obligations of White Eagle and WEGP as of the closing date of the Transactions, and Lamington, the Company and WEGP agreed to terminate, waive and release any intercompany debt, obligations and liabilities of White Eagle to Lamington, the Company and WEGP. On August 16, 2019, Emergent entered into the Indemnification Agreement pursuant to which it indemnified Wilmington Trust, National Association against claims and liabilities that may arise in relation to policies that have matured prior to the Closing Date but as to which Wilmington Trust, National Association has historically held title as securities intermediary. Amended and Restated Limited Partnership Agreement of White Eagle In connection with the WE Investment, the Limited Partnership Agreement of White Eagle was amended and restated (the "A&R LPA") to provide for the issuance of the Class A, B and D limited partnership interests, for funding of an "Advance Facility" evidenced by the Class D limited partnership interests and to maintain reserves sufficient to fund premiums, certain operating expenses of White Eagle and certain minimum payments to Lamington as the holder of the Class B interests. The A&R LPA provides generally that holders of the Class A and Class B Interests receive distributions of proceeds of the assets of White Eagle based on their 72.5% and 27.5% ownership, respectively, after certain expenses and reserves are funded (including such minimum payments to Lamington totaling approximately $8.0 million per year for the first three (3) years and $4.0 million for the subsequent seven (7) years, provided that commencing after year three (3), such minimum payments will be utilized to repay the Class D Return of $8.0 million, which was advanced at closing, plus the greater of $2.0 million or 11% per annum on such $8.0 million to the extent necessary to fully repay such Class D Return. The minimum payments to the Company will occur regardless of maturities with payments through the premium/expense reserve account when there are no maturity proceeds available for distribution as described below). However, the A&R LPA also provides that all payments to holders of the Class B interests (other than such minimum payments to Lamington during the first eight (8) years following the Closing Date) are fully subordinated to payments in respect of the minimum returns to holders of the Class A and Class D interests (including repayment of all amounts advanced in respect of the Advance Facility) and to any indemnification payments, if any, due to such holders and related indemnified persons pursuant to the indemnities afforded them in and in relation to the A&R LPA, Subscription Agreement, Master Termination Agreement and related documents. As of the closing of the WE Investment, Lamington Road Bermuda, LTD resigned as manager of the portfolio and was replaced by an affiliate of Jade Mountain. On August 16, 2019, White Eagle , Palomino JV GP Limited, ("the General Partner") and the Manager entered into the Management Agreement, setting forth the terms and conditions pursuant to which the General Partner has delegated certain of its management rights and obligations under the A&R LPA to the Manager. Advance Facility . The facility under which the Class A Limited Partner or its Affiliates from time to time advance to the Class B Limited Partner (or, as a matter of convenience only, provides the proceeds of any such advance directly to the Partnership on behalf of the Class B Limited Partner, provided that, for the avoidance of doubt, any such advance distributed directly to the Partnership shall not be deemed to be an incurrence of an obligation of the Partnership for the repayment thereof) the portion of the premium/expense reserve account owed by the Class B Limited Partner under the Agreement. Essentially, this is the aggregate amount owed by the Class B Limited Partner to the Class A Limited Partner thereunder as a result of such advances. Class A Minimum Return Cumulative Amount. An amount equal to 11% per annum, compounded quarterly and accruing from the Effective Date, on the sum of (i) 100% of the initial contribution by the Class A Limited Partner on its own behalf to the premium/expense reserve account, accruing from the Effective Date until repaid (as reduced by any repayment thereof) (but for the avoidance of doubt excluding any advances made by the Class A Limited Partner under the Advance Facility), (ii) 100% of the amounts funded into the premium/expense reserve account by the Class A Limited Partner on its own behalf after the Effective Date (as reduced by any repayment thereof), accruing from the date of funding until repaid (but for the avoidance of doubt excluding any advances made by the Class A Limited Partner under the Advance Facility), and (iii) the Purchase Price of $374.2 million (as reduced by any portion thereof repaid by the Class B Interest Monthly Distribution, as defined below, (v) that reflects amortization of principal, all sale proceeds received by the Class A Limited Partner and any reductions thereof as contemplated by the permitted disposition of policies, (plus (x) the amount necessary to reduce the principal balance to the targeted principal balance hereto for such Distribution Date, plus (y) later contributions by the Class A Limited Partner (excluding any advances made by the Class A Limited Partner under the Advance Facility but, for the avoidance of doubt, including amounts funded into the premium/expense reserve account by the Class A Limited Partner on its own behalf), plus (z) the Class D Return. At August 16, 2019, the target principal balance was $406.0 million, including, $366.2 million for the asset purchase price, $21.8 million for Class A premium reserve funding, $8.3 million Class B Advance Facility, $8.0 million for Class D interests and $1.8 million for facility expenses. On December 4, 2019 the Company and certain of its subsidiaries entered into a Settlement Agreement and Mutual Release (the "Settlement Agreement") with Sun Life Assurance Company of Canada ("Sun Life") and Wilmington Trust, N.A. as securities intermediary ("Wilmington Trust"). Pursuant to the Settlement Agreement, 31 life insurance policies with face value totaling $163.5 million issued by Sun Life were canceled in exchange for a lump sum payment of $36.1 million. The settlement included two policies held by the Company outside of White Eagle with an aggregate face value of $12.0 million, 28 policies held by White Eagle with an aggregate face value of $141.5 million and one policy with a face value of $10.0 million in receivable for maturity for White Eagle. Of this amount, approximately $12.7 million was received by the Company, $13.4 million was paid to White Eagle and $10.0 million was paid to Wilmington Trust for the maturity receivable. With this settlement, the Company no longer owns any life insurance policies directly. With this settlement, the target principal balance for the Class A Partner was reduced by the proceeds from the Sun Life settlement of $13.4 million with $392.6 million outstanding at August 31, 2020. During the nine months ended August 31, 2020, approximately $10.0 million was distributed to the Class A Partner to satisfy the Class A minimum return. Class A True Up Payment . As of the applicable Distribution Date, (i) the excess (if positive) of (x) 72.5% of the total return distributions over (y) the sum of cumulative amounts actually received by the Class A Limited Partner prior to such Distribution Date on account of clauses (w), (x) and (y) of the Class A Minimum Return Cumulative Amount, any Class A true up payments and amounts paid to the Class A Limited Partner pursuant plus (ii) the amount necessary such that the Class A Limited Partner shall have received 72.5% of total return distributions after giving effect to the amounts to be paid to the Class A Limited Partner on such Distribution Date. Class B True Up Payment . As of the applicable Distribution Date, (i) the excess (if positive) of (x) 27.5% of the Total Return Distributions over (y) the sum of cumulative amounts actually received by the Class B Limited Partners prior to such Distribution Date on account of the Minimum Class B Interest Monthly Distributions, the Class B True Up Payments and amounts paid to the Class B Limited Partners pursuant to Section 3.2(b)(v) (plus the cumulative amounts that were paid to the Class A Limited Partner in repayment of the Advance Facility, to the Class D Limited Partner on account of the Class D Return, or to the Purchaser Indemnified Parties to satisfy (in whole or in part) the indemnity obligations of Parent, Lamington or the Class B Limited Partner) plus (ii) the amount necessary such that the Class B Limited Partners shall have received 27.5% of Total Return Distributions after giving effect to the amounts to be paid to the Class B Limited Partner on account of the Minimum Class B Interest Monthly Distributions and amounts paid to the Class B Limited Partners on such Distribution Date in the priority of payments after payment of any Class A True Up Payments and Class B True Up Payments (plus the cumulative amounts that would have been distributed to the Class B Limited Partners but that were paid to the Class A Limited Partner in repayment of the Advance Facility, to the Class D Limited Partner on account of the Class D Return, or to the Purchaser Indemnified Parties to satisfy (in whole or in part) the indemnity obligations of Parent, Lamington or the Class B Limited Partner). At August 31, 2020 there was no Class B true up payment outstanding. Class D Return . The aggregate repayment amount of approximately $8.0 million ( as described above) owed by the Class B Limited Partner to the Class D Limited Partner, payable in accordance with the terms herein, which shall equal the greater of (x) 125% of the Class D Payment Amount (which is $10.0 million), and (y) the Class D Payment Amount plus the total amount of unpaid interest accruing on the Class D Payment Amount at a rate equal to 11% per annum compounded quarterly from the Effective Date through the date on which the Class D payment amount and all accrued and unpaid interest is repaid in full. At August 31, 2020, accrued and unpaid interest on the Class D Return was approximately $934,000 with outstanding principal of $8.0 million. The amount is to be repaid through the waterfall distribution as stated above. There was no payment made during the nine months ended August 31, 2020. Distribution Date. The 5th Business Day of each month. Minimum Class B Interest Monthly Distribution. The monthly amount equal to (i) for each month commencing prior to the third anniversary of the Effective Date, the greater of $667,000 and 1/12th of 1.50% of the Net Asset Value as determined by the most recent valuation report obtained on or prior to such Distribution Date and (ii) for each month commencing on or after the third anniversary of the Effective Date and prior to the tenth anniversary of the Effective Date, the greater of $333,000 and 1/12th of 0.75% of the net asset value as determined by the most recent valuation report obtained on or prior to such Distribution Date. During the three months and nine months ended August 31, 2020, approximately $2.0 million and $6.0 million, respectively, were received by the Company for the minimum Class B interest monthly distribution. These amounts are included in change in fair value of investment in limited partnership, net of distributions on the consolidated statements of operations. Expense . On August 16, 2019, the Class A Limited Partner contributed $21.8 million to the premium/expense reserve account in satisfaction of its obligations to fund the premium/expense reserve account as of the Effective Date, and (ii) advanced under the Advance Facility $8.3 million by deposit into the premium/expense reserve account on behalf of the Class B Limited Partner, in satisfaction of the Class B Limited Partner’s obligations to fund the premium/reserve fund as of the Effective Date. This $8.3 million is to be repaid through the waterfall distribution from amounts to be distributed to the Company. Total initial premium/expense reserve was approximately $30.0 million on August 16, 2019. The Class A Limited Partner also contributed $1.8 million towards expenses on August 16, 2019. At August 31, 2020, approximately $1.0 million in accrued and unpaid interest was outstanding on the $8.3 million advanced on behalf of the Class B Limited Partner, the amount is to be repaid through the waterfall distribution as stated above. There was no payment during the three months ended August 31, 2020. If at any time prior to a Distribution Date, the amount in the premium/expense reserve account is less than an amount sufficient to cover the next month of premiums and expenses, as set forth in the budget or as otherwise determined by the General Partner based upon advice of the Manager, the Class A Limited Partner will (i) contribute its percentage interest of 72.5%, and (ii) make advances under the Advance Facility of the Class B Limited Partner’s percentage interest of 27.5%, for the aggregate amount of additional capital needed to increase the balance of the premium/expense reserve account to an amount sufficient to cover the next three months of premiums and expenses, as set forth in the budget. All advances made by the Class A Limited Partner under the Advance Facility, whether prior to, on or after the Effective Date, shall accrue interest at the rate of 11% per annum, compounded quarterly, until repaid, and all such amounts (including any accrued but unpaid interest) shall be secured by the Class B Partnership Units pursuant to the Pledge Agreement. After the Effective Date, the General Partner will use commercially reasonable efforts to obtain financing proposals for premiums and expenses on terms more favorable to the Class B Limited Partner than the Advance Facility, if and to the extent available, and in the event such financing is obtained, the Class A Limited Partner shall no longer have any obligation to fund advances under the Advance Facility. Funds in the premium/expense reserve account shall be used or otherwise distributed in the following order of priority (in thousands): Premium/Expense Reserve Account Three Months Ended August 31, 2020 Nine Months Ended August 31, 2020 Amount Amount Use of Proceeds First $ 28,289 $ 79,241 Premiums, Expenses and Manager Fees Second 2,000 6,000 Minimum Class B Interest Monthly Distribution - after three years, Class D Returns takes priority until paid in full Third — — Minimum Class B Interest Monthly Distribution Fourth — — Retained for Premium/Expense to Cover Three Months of Transactions, excess to be sent to the Collection Account $ 30,289 $ 85,241 During the three months ended August 31, 2020, approximately $30.3 million was distributed from the premium/expense reserve inclusive of approximately $26.6 million utilized to pay premiums, approximately $1.7 million in facility related expenses and approximately $2.0 million utilized for distribution to the Company to satisfy the requirements of the Class B monthly distribution. During the nine months ended August 31, 2020, approximately $85.2 million was distributed from the premium/expense reserve inclusive of approximately $74.0 million utilized to pay premiums, approximately $5.3 million in facility related expenses and approximately $6.0 million utilized for distribution to the Company to satisfy the requirements of the Class B monthly distribution. Premium/Expense Reserve Account Three Months Ended August 31, 2019 Nine Months Ended August 31, 2019 Amount Amount Use of Proceeds First $ 8,210 $ 8,210 Premiums, Expenses and Manager Fees Second — — Minimum Class B Interest Monthly Distribution - after three years, Class D Returns takes priority until paid in full Third — — Minimum Class B Interest Monthly Distribution Fourth — — Retained for Premium/Expense to Cover Three Months of Transactions, excess to be sent to the Collection Account $ 8,210 $ 8,210 During the three months and nine months ended August 31, 2019, approximately $8.2 million was distributed from the premium/expense reserve with the balance of approximately $21.8 million remaining in the account at August 31, 2019. During the three months and nine months ended August 31, 2020, the premium/expense reserve account received approximately $34.2 million and $107.2 million, respectively from the collection account through maturity proceeds collected. The account balance was approximately $26.1 million at August 31, 2020. Approximately $3.8 million was in the collection account pending distributions to the premium/expense account at August 31, 2020. The below is a reconciliation of the premium/expense reserve account for the three months and nine months ended August 31, 2020 (in thousands). Three Months Ended August 31, 2020 Nine Months Ended August 31, 2020 Beginning balance $ 22,224 $ 4,195 Distributions received Collections account 34,188 107,169 Total distribution received $ 56,412 $ 111,364 Less Payments: Premiums and expenses 28,289 79,241 Class B monthly distribution 2,000 6,000 Total payments $ 30,289 $ 85,241 Balance at August 31, 2020 $ 26,123 $ 26,123 Approximately $667,000 was due for distribution to the Company to cover the period ended August 31, 2020 and the amount was received subsequent to the quarter end. Distribution . The General Partner has established a separate bank account on behalf of, and in the name of, the Partnership to hold, and shall direct all death benefits and other cash received by the Partnership (other than capital contributions, proceeds of the Advance Facility, and death benefits from matured policies which shall be distributed in accordance with Section 2.02(b) of the Subscription Agreement) into such account (the "Collections Account"). On each Distribution Date, funds on deposit in the Collections Account shall be distributed by the Paying Agent ("Wilmington Trust, N.A") pursuant to the Waterfall Notice in the following order of priority: Collection Account Three Months Ended August 31, 2020 Nine Months Ended August 31, 2020 Priority Amount Use of Proceeds First $ 34,188 $ 107,169 Premium/Expense Reserve Account - to cover next three months of premiums and expense Second — 9,969 Class A Minimum Return Cumulative Amount* Third — — Minimum Class B Interest Monthly Distribution Fourth — — Re-balancing the Total Return Distributions with 72.5% to the Class A Limited Partner and 27.5% to Class B Limited Partner Fifth — — 72.5% to the Class A Limited Partner and 27.5% to the Class B Limited Partner $ 34,188 $ 117,138 * Second - To pay the Class A Limited Partner the amount necessary such that the Class A Limited Partner shall have received the Class A Minimum Return Cumulative Amount (applied first which is 11%), second to the amounts necessary to reduce the principal balance from $406.0 million on the Effective Date to April 2039 when it is expected to be paid in full (the A&R LPA stipulate the expected monthly reduction in target principal commencing in April 2021), third to later contributions by the Class A Limited Partner, excluding Advance Facility but includes funded into premium/expense account on its own behalf and fourth the Class D Return, in each case of the definition of Class A Minimum Return Cumulative Amount as of the last day of the month immediately prior to such Distribution Date. The below is a reconciliation of funds received in and distributed from the collection account for the three months ended August 31, 2020 and nine months ended August 31, 2020 (in thousands). Three Months Ended August 31, 2020 Nine Months Ended August 31, 2020 Beginning balance $ 5,643 $ 13,007 Maturity proceeds received - face 32,050 107,276 Proceeds received - other* 272 632 Total receipts 37,965 120,915 Less distribution Premium/expense account 34,188 107,169 Class A — 9,969 Total distributions 34,188 117,138 Balance at August 31, 2020 $ 3,777 $ 3,777 *Includes refund of premiums and interest earned on maturity proceeds During the three months ended August 31, 2020, the portfolio experienced maturities of 13 policies with face value of approximately $43.2 million, gain on maturity of $30.0 million, weighted average age of 88.9 years and weighted average remaining life expectancy of 4.5 years. The ratio of realized gain to face value was approximately 69%. Approximately $32.1 million was collected during the three months ended August 31, 2020. During the nine months ended August 31, 2020, the portfolio experienced maturities of 33 policies with face value of approximately $133.3 million , gain on maturity of $78.5 million, weighted average age of 88.6 years and weighted average remaining life expectancy of 4.1 years. The ratio of realized gain to face value was approximately 58.9%. Approximately $107.3 million was collected during the nine months ended August 31, 2020 with $39.7 million pending collection at August 31, 2020. The below is a reconciliation of receivable for maturity of life settlement held by the limited partnership for the three months and nine months ended August 31, 2020 (in thousands). Three Months Ended August 31, 2020 Nine Months Ended August 31, 2020 Balance at start $ 28,550 $ 13,726 Maturities 43,225 133,275 Less: proceeds received 32,050 107,276 Receivable at August 31, 2020 $ 39,725 $ 39,725 The Company performed a valuation at August 31, 2020 resulting in a fair value of approximately $152.5 million compared to $137.8 million at November 30, 2019, resulting in a change in fair value of approximately $4.3 million and $20.6 million for the three months and nine months ended August 31, 2020. See Note 16, "Fair Value Measurements" , to the accompanying consolidated financial statements for further information. At August 31, 2020, there were 500 policies in the White Eagle portfolio with death benefits of approximately $2.4 billion and the weighted average remaining life expectancy calculated based on death benefit of the insureds in the policies was 6.6 years. Remaining Life Expectancy (In Years)* Number of Life Settlement Contracts Face Value 0-1 9 $ 40,780 1-2 30 114,006 2-3 30 121,696 3-4 54 281,198 4-5 54 253,239 Thereafter 323 1,556,622 Total 500 $ 2,367,541 *Based on remaining life expectancy at August 31, 2020, as derived from reports of third party life expectancy providers, and does not indicate the timing of expected death benefits. Estimated premiums to be paid for each of the five succeeding fiscal years and thereafter to keep the life insurance policies in force as of August 31, 2020, are as follows (in thousands): Year Expected Premiums 2020 $ 25,197 2021 104,768 2022 100,021 2023 93,316 2024 87,998 Thereafter 572,074 $ 983,374 The amount of $1.0 billion noted above represents the estimated total future premium payments required to keep the life insurance policies in force during the life expectancies of all the underlying insured lives and does not give effect to projected receipt of death benefits. The estimated total future premium payments could increase or decrease significantly to the extent that insurance carriers increase the cost of insurance on their issued policies or that actual mortalities of insureds differs from the estimated life expectancies. See Note 16, "Fair Value Measurements" , to the accompanying consolidated financial statements for further information. |
White Eagle Revolving Credit Fa
White Eagle Revolving Credit Facility | 9 Months Ended |
Aug. 31, 2020 | |
White Eagle | Revolving Credit Facility | |
Debt Instrument [Line Items] | |
Credit Facility | 65% N/A 100% —% —% 50%-65% N/A 70% 16.5% 13.5% 35%-50% N/A 55% 24.8% 20.3% 0%-35% N/A 45% 30.3% 24.8% Provided that (i) if (a) the Company failed to maintain a cash interest coverage ratio of at least 2.0:1 at any time during the immediately preceding calendar quarter or (b) the Company fails to take steps to improve its solvency in a manner acceptable to the required lenders (as determined in their sole and absolute discretion), then the cash flow sweep percentage to the lenders shall equal one-hundred percent (100%) and (ii) if such distribution date occurs on or after December 29, 2025, then the cash flow sweep percentage shall equal one-hundred percent (100%). The cash interest coverage ratio is the ratio of (i) consolidated cash and cash equivalents maintained by the Company to (ii) the aggregate interest amounts that will be due and payable in cash on (x) the $47.6 million 8.5% Senior Secured Notes due July 15, 2021 (and any notes issued by the Company or any of its Affiliates in connection with refinancing, replacing, substituting or any similar action with respect to any such notes), the $75.8 million 5.0% Convertible Notes due February 15, 2023 (and any notes issued by the Company or any of its Affiliates in connection with refinancing, replacing, substituting or any similar action with respect to any such notes), and the $1.2 million 8.5% Convertible Notes due February 15, 2019 which was fully repaid during the year ended November 30, 2019 (and any notes issued by the Company or any of its Affiliates in connection with refinancing, replacing, substituting or any similar action with respect to any such notes) and (y) any additional indebtedness issued by the Company after December 29, 2016, in each case, during the twelve month period following such date of determination. See Note 13, "8.50% Senior Unsecured Convertible Notes" , Note 14, "5.0% Senior Unsecured Convertible Notes" and Note 15, "8.5% Senior Secured Notes" , to the accompanying consolidated financial statements for further information. With respect to approximately 25% of the face amount of policies pledged as collateral under the White Eagle Revolving Credit Facility, White Eagle has agreed that if policy proceeds that are otherwise due are not paid by an insurance carrier, the foregoing distributions will be altered such that the lenders will receive any "catch-up" payments with respect to amounts that they would have received in the waterfall prior to distributions being made to White Eagle. During the continuance of events of default or unmatured events of default, the amounts from collections of policy proceeds that might otherwise be paid to White Eagle will instead be held in a designated account controlled by the lenders and may be applied to fund operating and third party expenses, interest and principal, "catch-up" payments or percentage payments that would go to the lenders as described above. The below is a reconciliation of proceeds collected by the White Eagle Revolving Credit Facility and distributed from the collection account in accordance with the budget approved by the Bankruptcy court and the White Eagle Revolving Credit Facility termination agreement (in thousands): Nine Months Ended August 31, 2019 Collection account balance at December 1, 2018 $ 28,059 Face value collected in current quarter 60,163 Face value collected in prior quarters 32,342 Other collections * 2,575 $ 123,139 Expenses paid from the collection account Post-Petition Premiums paid 2019 $ (65,905) Interest expenses (28,331) Payment toward principal (1,804) White Eagle credit facility expenses (9,304) Refund of premium payments advanced by parent (3,000) Lender allowed claim-Beal (5,839) Transfers of remaining funds to Lamington (8,956) $ (123,139) Collection account balance at August 16, 2019** $ — *Includes refund of premiums and interest earned on maturity proceeds ** Collection account was closed on August 16, 2019 in connection with the termination of the White Eagle Revolving Credit Facility. During the three months and nine months ended August 31, 2019, advances for premium payments and fees to service providers amounted to (in thousands): Three Months Ended August 31, Nine Months Ended August 31, 2019 2019 Amount drawn for premium payments $ — $ 4,221 Total amount drawn $ — $ 4,221 Interest. Borrowings under the White Eagle Revolving Credit Facility bear interest at a rate equal to LIBOR or, if LIBOR is unavailable, the base rate, in each case plus an applicable margin of 4.50%, which was increased from 4.00% pursuant to the November 9, 2015 amendment, and subject to a rate floor component equal to the greater of LIBOR (or the applicable rate) and 1.5%. The base rate under the White Eagle Revolving Credit Facility equals the sum of (i) the weighted average of the interest rates on overnight federal funds transactions or, if unavailable, the average of three federal funds quotations received by the Agent plus 0.75% and (ii) 0.5%. Based on the loan agreement, the LIBOR portion of the interest rate will re-adjust annually, once the floor has exceeded 1.5%. The applicable rate will be dependent on the rate at the last business day of the preceding calendar year. On December 31, 2018, the LIBOR floor increased from 2.11% to 3.01%. The effective rate at August 15, 2019 and August 31, 2018 was 9.51% and 6.61%, respectively. In the event that an Event of Default has occurred and is continuing, the interest rate will be equal to the sum of (i) the greater of (a) (1) LIBOR or, if LIBOR is unavailable, (2) the Base Rate and (b) one and a half percent (1.5%) plus (ii) six and a half percent (6.5%). Interest of approximately $23.3 million and $28.3 million was paid during the three months and nine months ended August 31, 2019. Maturity. Effective with the White Eagle Second Amendment, the term of the White Eagle Revolving Credit Facility expires December 31, 2031, which is also the scheduled commitment termination date (though the lenders’ commitments to fund borrowings may terminate earlier in an event of default). The lenders’ interests in and rights to a portion of the proceeds of the policies does not terminate with the repayment of the principal borrowed and interest accrued thereon, the termination of the White Eagle Revolving Credit Facility or expiration of the lenders’ commitments. Covenants/Events of Defaults . The White Eagle Revolving Credit Facility contains covenants and events of default that are customary for asset-based credit agreements of this type, but also include cross defaults under the servicing, account control, contribution and pledge agreements entered into in connection with the White Eagle Revolving Credit Facility (including in relation to breaches by third parties thereunder), certain changes in law, changes in control of or insolvency or bankruptcy of the Company and relevant subsidiary companies and performance of certain obligations by certain relevant subsidiary companies, White Eagle and third parties. Effective with the White Eagle Second Amendment, and as described above in "Amortization and Distributions", the White Eagle Revolving Credit Facility contains a financial covenant requiring White Eagle to maintain a cash interest coverage ratio of at least 1.75:1 commencing after June 30, 2019. Failure to maintain this ratio for 60 consecutive days after June 30, 2019 constitutes an event of default. There is no cash interest coverage ratio requirement that would result in an event of default prior to this date; however, any failure to maintain a cash interest coverage ratio of at least 2.0:1 does impact the cash flow sweep percentage for proceeds distributed through the waterfall. Remedies. The White Eagle Revolving Credit Facility and ancillary transaction documents afford the lenders a high degree of discretion in their selection and implementation of remedies, including strict foreclosure, in relation to any event of default, including a high degree of discretion in determining whether to foreclose upon and liquidate all or any pledged policies, the interests in White Eagle, and the manner of any such liquidation. White Eagle has limited ability to cure events of default through the sale of policies or the procurement of replacement financing. The Company elected to account for the debt under the White Eagle Revolving Credit Facility in accordance with ASC 820, Fair Value Measurements and Disclosures , which includes the 45% interest in policy proceeds to the lender, using the fair value method. The fair value of the debt is the amount the Company would have to pay to transfer the debt to a market participant in an orderly transaction. The Company calculated the fair value of the debt using a discounted cash flow model taking into account the stated interest rate of the credit facility and probabilistic cash flows from the pledged policies. Considerable judgment is required in interpreting market data to develop the estimates of fair value. Accordingly, the Company’s estimates are not necessarily indicative of the amounts that the Company, or holders of the instruments, could realize in a current market exchange. The most significant assumptions are the estimates of life expectancy of the insured and the discount rate. The use of different assumptions and/or estimation methodologies could have a material effect on the estimated fair values. Voluntary Petitions for Relief Under Chapter 11 On the Petition Date, Lamington and WEGP filed the November Chapter 11 Cases in the Bankruptcy Court. Lamington was the limited partner and owned 99.99%, and WEGP was the general partner and owned 0.01% of White Eagle. In its capacity as general partner, WEGP managed the affairs of White Eagle. The Lamington and WEGP filings are referred to as the "November Chapter 11 Cases." The commencement of the November Chapter 11 Cases constitutes an event of default under the White Eagle Revolving Credit Facility, resulting in the principal and accrued interest due from White Eagle thereunder becoming immediately due and payable. Lamington and WEGP have pledged their respective interests in White Eagle to secure its obligations under the White Eagle Revolving Credit Facility. Any efforts of CLMG to enforce such pledges by Lamington and WEGP of their respective interests in White Eagle in connection with the White Eagle Revolving Credit Facility are automatically stayed as a result of the commencement of the November Chapter 11 Cases and LNV’s and CLMG’s rights of enforcement in respect of the White Eagle Revolving Credit Facility are subject to the applicable provisions of the Bankruptcy Code. In addition, on November 15, 2018, White Eagle, LNV and CLMG entered into an Agreement Regarding Rights and Remedies (the "Standstill Agreement"), pursuant to which LNV and CLMG agreed to refrain from exercising their rights and remedies in connection with the White Eagle Revolving Credit Facility, subject to the terms and provisions of the Standstill Agreement, until 12:00 p.m. noon Pacific time on November 26, 2018, to facilitate negotiations. The effective period under the Standstill Agreement was extended several times, finally to December 13, 2018. On September 16, 2019, the Bankruptcy Court entered an order and final decree closing the White Eagle Chapter 11 Case. The Lamington and WEGP Chapter 11 Cases were closed on November 25, 2019. On December 13, 2018, White Eagle filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code in the Bankruptcy Court. The Chapter 11 case is being administered under case number 18-12808 (the "White Eagle Chapter 11 Case" and, together with the November Chapter 11 Cases, the "Chapter 11 Cases"). The commencement of the White Eagle Chapter 11 Case would constitute a default and event of default under the terms of the Amended and Restated Senior Note Indenture relating to the Company’s Amended and Restated Senior Secured Indenture and the New Convertible Note Indenture. However, such defaults and events of default and their consequences were waived in advance of the White Eagle Chapter 11 Case by holders of all of the outstanding principal amount of the 8.5% Senior Secured Notes and by holders of a majority of the outstanding principal amount of the outstanding New Convertible Notes, and consequently, the Company believes that no defaults, events of default or acceleration of the payment obligations thereunder, including principal or accrued interest, occurred under either the Company’s Amended and Restated Senior Secured Indenture or the New Convertible Note Indenture. The commencement of the White Eagle Chapter 11 Case, together with the related Chapter 11 Cases, constitutes an event of default under the White Eagle Revolving Credit Facility, resulting in the principal and accrued interest due from White Eagle thereunder becoming immediately due and payable. Lamington and WEGP have pledged their respective interests in White Eagle to secure its obligations under the White Eagle Revolving Credit Facility. Any efforts by LNV to enforce repayment by White Eagle and/or such pledges by Lamington and WEGP of their respective interests in White Eagle in connection with the White Eagle Revolving Credit Facility are automatically stayed as a result of the commencement of the Chapter 11 Cases and LNV’s and CLMG’s rights of enforcement in respect of the White Eagle Revolving Credit Facility are subject to the applicable provisions of the Bankruptcy Code. On September 16, 2019, the Bankruptcy Court entered an order and final decree closing the White Eagle Chapter 11 Case. The Lamington and WEGP Chapter 11 Cases were closed on November 25, 2019. Deconsolidation and Subsequent Measurement of the Deconsolidated Entities Lamington and its subsidiaries' (White Eagle, WEGP and Lamington Bermuda) financial results were excluded from the Company’s consolidated results for the period from November 14, 2018, the Petition Date, to August 16, 2019, the day the date the White Eagle Revolving Credit Facility was terminated. ASC 810, Consolidation require that an entity whose financial statements were previously consolidated with those of its parent that files for protection under the U.S. Bankruptcy Code, whether solvent or insolvent, generally must be prospectively deconsolidated from the parent and presented as an equity investment (deconsolidation applies to Lamington and all subsidiaries owned, directly or indirectly, by Lamington, including WEGP, White Eagle and Lamington Bermuda which collectively are referred to herein as the ("Deconsolidated Entities" or the "Debtors"). Therefore, our 2019 results are not comparable with our 2018 results. Under ASC 810, this loss of control would likely trigger a gain or loss for the parent as the parent would remeasure its retained noncontrolling investment at fair value each reporting period. We assessed the inherent uncertainties associated with the outcome of the Chapter 11 reorganization process and the anticipated duration thereof, and concluded that it was appropriate to deconsolidate Lamington and its subsidiaries effective on the Petition Date. Effective August 17, 2019, the entities were deemed to have emerged from bankruptcy and were no longer deconsolidated. See Note 2, "Summary of Significant Accounting Policies - Reorganization and Consolidation" to the accompanying consolidated financial statements. Beal Litigation On January 25, 2019, the Company, White Eagle, Lamington, and WEGP (collectively the "Plaintiffs" filed the Suit against LNV, Silver Point and GWG the "Defendants") in the Bankruptcy Court where the Suit will be administered together with the previously filed Chapter 11 Cases. LNV, a subsidiary of Beal, is the lender under the White Eagle Revolving Credit Facility. In the Suit, the Plaintiffs allege that the Defendants engaged in a scheme to coerce the Plaintiffs into selling their valuable portfolio of life insurance policies to defendants for well below its true value. Pursuant to the White Eagle Revolving Credit Facility, LNV agreed to lend $370 million to White Eagle, and in connection therewith received a 45% equity stake in White Eagle. That equity stake, and LNV’s significant control over White Eagle under the White Eagle Revolving Credit Facility, creates a joint venture, and gives rise to fiduciary duties to White Eagle and Emergent, on the part of LNV. The Plaintiffs further allege that LNV has been engaged in a concerted campaign to "squeeze" White Eagle and Emergent by improperly restricting their cash flow, in the hopes that White Eagle and Emergent will have no choice but to sell the valuable policy portfolio to LNV or one of its proxies, including Silver Point and/or GWG, at below its true value. In connection with the White Eagle Chapter 11 Case, on January 15, 2019, the Court authorized the Debtors to use the proceeds of pre-petition cash collateral for a period of twenty (20) weeks (the "Cash Collateral"), which allowance was extended in May 2019 for another nine (9) weeks. The Cash Collateral may be used solely for the purposes permitted under the budget approved by the Court, including (i) to provide working capital needs of the Debtors and general corporate purposes of the Debtors, (ii) to make the payments or fund amounts otherwise permitted in the final order that authorized such uses and such budget, (iii) to fund amounts necessary to pay certain fees; and (iv) to fund amounts necessary to pay certain professional fees in accordance with such Budget. Global Settlement Agreement in Principle in Bankruptcies On May 7, 2019, the Proposed Settlement, a global settlement in principle of the Chapter 11 Cases and the Suit, was announced on the record to, and filed with, the Bankruptcy Court jointly by the Debtors and Defendants. The Proposed Settlement would be effected together with the plan of reorganization, in accordance with the following schedule: (x) the Proposed Settlement and plan of reorganization, and other relevant documents, would be filed with the Bankruptcy Court by May 24, 2019, (y) the parties would use their best efforts to have the Proposed Settlement approved by the Bankruptcy Court by June 7, 2019, and (z) the parties would use their best efforts to have a confirmation hearing for approval of the plan of reorganization by the Bankruptcy Court held on or before June 21, 2019. Pursuant to the Proposed Settlement, among other things: • White Eagle shall have up to and including September 17, 2019 to satisfy any and all obligations to LNV under the Credit Facility by paying LNV 102% of its outstanding principal plus accrued interest at the relevant default rate, accrued fees and costs, which aggregate amount would include the resolution of the 45% participation interest element of the Credit Facility which was part of the subject matter of the Suit; • If White Eagle satisfies such obligations after September 17, 2019 and by December 30, 2019, the amount due on the outstanding principal would increase to 104%; • In the event LNV has not received the payoff described above by September 17, 2019, the court-appointed liquidation trustee, together with investment banking assistance from Maple Life Financial, LLC, shall have full authority to sell White Eagle’s life insurance policy portfolio (which constitutes collateral under the Credit Facility) for the maximum amount achievable through an orderly sale process, taking into account that the transaction must be closed no later than December 30, 2019; in connection with this authority, the liquidation trustee and the investment banker may work prior to September 17, 2019 to prepare the portfolio for sale, but may not take actions to actually commence a sale including, but not limited to, marketing the portfolio or contacting potential buyers about the portfolio, prior to such date; • If the portfolio is sold in whole or in part, LNV shall only have the right to step in to bid for such sale if, and to the extent, the total amounts generated through the sale thereof do not fully satisfy the payoff amount; and • If the sale of any portion of the Collateral has not closed or the proceeds of such sale(s) have not been received by CLMG by December 30, 2019, (i) if the Payoff Amount has not then been paid in cash in full, such Collateral shall be transferred on or before Noon Eastern on December 31, 2019 to CLMG (or its designee) in full satisfaction of the remaining unpaid portion of the amounts due to LNV. In addition, in order to provide sufficient cash flow to the Company during this period, and subject to negotiation of mutually-agreed upon terms and conditions, the Debtors shall have the right to use proceeds from the maturity of any portfolio policy and resolution of certain claims, and LNV will provide the Debtors a revolving $15.0 million of debtor-in-possession financing (which amount may be increased if found to be insufficient) through December 30, 2019 (the "DIP Financing"). Plan of Reorganization On June 5, 2019, the Bankruptcy Court approved the Settlement Agreement memorializing the Proposed Settlement and the DIP Financing. The Plan of Reorganization for the Chapter 11 Cases, which implements the Settlement Agreement and the DIP Financing, was confirmed by the Bankruptcy Court on June 19, 2019. On July 18, 2019, the Company entered into the Commitment Letter with Lamington, White Eagle and Jade Mountain in connection with the Plan of Reorganization. The Commitment Letter provided for a transaction in which Jade Mountain and/or certain of its affiliates and/or certain investors would acquire 72.5% of the equity interests of White Eagle in exchange for $384.3 million as may be adjusted in accordance with the final documentation. The Commitment Letter and its terms and the transactions contemplated thereby were approved by the Bankruptcy Court on July 22, 2019. Repayment and Termination of the White Eagle Revolving Credit Facility On August 16, 2019, the Company entered into the Subscription Agreement, in connection with the Commitment Letter, pursuant to which White Eagle sold to Palomino 72.5% of its limited partnership interests, consisting of all of the newly issued and outstanding Class A and Class D interests, and WEGP sold to an affiliate of Jade Mountain all of its general partnership interests for a purchase price of approximately $366.2 million and $8.0 million for the Class A and Class D interests, respectively. Pursuant to the Subscription Agreement, Lamington retained 27.5% of the limited partnership interests of White Eagle, consisting of all of the newly issued and outstanding Class B interests in exchange for all of its previously owned White Eagle limited partnership interests with a value of approximately $138.9 million on the closing date. The proceeds of the WE Investment were used to satisfy in full (i) the White Eagle Revolving Credit Facility, and (ii) the DIP Financing extended by CLMG, as agent, and LNV, as lender, to White Eagle, each in connection with the termination of the White Eagle Revolving Credit Facility and the release of the related liens on the collateral thereunder pursuant to the Master Termination Agreement. The repayment and termination of the White Eagle Revolving Credit Facility and the termination of the DIP Financing, which had not been drawn against, were in accordance with the Plan of Reorganization." id="sjs-B5">White Eagle Revolving Credit Facility Effective April 29, 2013, White Eagle entered into a 15-year revolving credit agreement with LNV Corporation, as initial lender, Imperial Finance & Trading, LLC, as servicer and portfolio manager and CLMG Corp., as administrative agent. Proceeds from the initial advance under the facility were used, in part, to retire a bridge facility and to fund a payment to the lender protection insurance provider to release subrogation rights in certain of the policies pledged as collateral for the White Eagle Revolving Credit Facility. On May 16, 2014, White Eagle Asset Portfolio, LLC converted from a Delaware limited liability company to White Eagle Asset Portfolio, LP, a Delaware limited partnership (the "Conversion") and all of its ownership interests were transferred to an indirect, wholly-owned Irish subsidiary of the Company. In connection with the Conversion, the White Eagle Revolving Credit Facility was amended and restated among White Eagle, as borrower, Imperial Finance and Trading, LLC, as the initial servicer, the initial portfolio manager and guarantor, Lamington Road Bermuda Ltd., as portfolio manager, LNV Corporation, as initial lender, the other financial institutions party thereto as lenders, and CLMG Corp., as administrative agent for the lenders. The White Eagle Revolving Credit Facility was amended on November 9, 2015, December 29, 2016 and January 31, 2017. General & Security . The White Eagle Revolving Credit Facility provides for an asset-based revolving credit facility backed by White Eagle’s portfolio of life insurance policies with an aggregate lender commitment of up to $370.0 million, subject to borrowing base availability. Borrowing Base. Borrowing availability under the White Eagle Revolving Credit Facility is subject to a borrowing base, which at any time is equal to the lesser of (A) the sum of all of the following amounts that have been funded or are to be funded through the next distribution date: (i) the initial advance and all additional advances to acquire additional pledged policies that are not for ongoing maintenance advances, plus (ii) 100% of the sum of the ongoing maintenance costs, plus (iii) 100% of fees and expense deposits and other fees and expenses funded and to be funded as approved by the required lenders, less (iv) any required payments of principal and interest previously distributed and to be distributed through the next distribution date; (B) 75% of the valuation of the policies pledged as collateral as determined by the lenders; (C) 50% of the aggregate face amount of the policies pledged as collateral (excluding certain specified life insurance policies); and (D) the then applicable facility limit. Amortization & Distributions. Proceeds from the maturity of the policies pledged as collateral under the White Eagle Revolving Credit Facility are distributed pursuant to a waterfall. After distributions for premium payments, fees to service providers and payments of interest, a percentage of the collections from policy proceeds are to be paid to the Company, which will vary depending on the then LTV ratio as illustrated below where the valuation is determined by the lenders: LTV Premiums, Interest & Other Fees Principal Distribution to White Eagle - 55% Lender Participation - 45% N/A 100% —% —% —% >65% N/A 100% —% —% 50%-65% N/A 70% 16.5% 13.5% 35%-50% N/A 55% 24.8% 20.3% 0%-35% N/A 45% 30.3% 24.8% Provided that (i) if (a) the Company failed to maintain a cash interest coverage ratio of at least 2.0:1 at any time during the immediately preceding calendar quarter or (b) the Company fails to take steps to improve its solvency in a manner acceptable to the required lenders (as determined in their sole and absolute discretion), then the cash flow sweep percentage to the lenders shall equal one-hundred percent (100%) and (ii) if such distribution date occurs on or after December 29, 2025, then the cash flow sweep percentage shall equal one-hundred percent (100%). The cash interest coverage ratio is the ratio of (i) consolidated cash and cash equivalents maintained by the Company to (ii) the aggregate interest amounts that will be due and payable in cash on (x) the $47.6 million 8.5% Senior Secured Notes due July 15, 2021 (and any notes issued by the Company or any of its Affiliates in connection with refinancing, replacing, substituting or any similar action with respect to any such notes), the $75.8 million 5.0% Convertible Notes due February 15, 2023 (and any notes issued by the Company or any of its Affiliates in connection with refinancing, replacing, substituting or any similar action with respect to any such notes), and the $1.2 million 8.5% Convertible Notes due February 15, 2019 which was fully repaid during the year ended November 30, 2019 (and any notes issued by the Company or any of its Affiliates in connection with refinancing, replacing, substituting or any similar action with respect to any such notes) and (y) any additional indebtedness issued by the Company after December 29, 2016, in each case, during the twelve month period following such date of determination. See Note 13, "8.50% Senior Unsecured Convertible Notes" , Note 14, "5.0% Senior Unsecured Convertible Notes" and Note 15, "8.5% Senior Secured Notes" , to the accompanying consolidated financial statements for further information. With respect to approximately 25% of the face amount of policies pledged as collateral under the White Eagle Revolving Credit Facility, White Eagle has agreed that if policy proceeds that are otherwise due are not paid by an insurance carrier, the foregoing distributions will be altered such that the lenders will receive any "catch-up" payments with respect to amounts that they would have received in the waterfall prior to distributions being made to White Eagle. During the continuance of events of default or unmatured events of default, the amounts from collections of policy proceeds that might otherwise be paid to White Eagle will instead be held in a designated account controlled by the lenders and may be applied to fund operating and third party expenses, interest and principal, "catch-up" payments or percentage payments that would go to the lenders as described above. The below is a reconciliation of proceeds collected by the White Eagle Revolving Credit Facility and distributed from the collection account in accordance with the budget approved by the Bankruptcy court and the White Eagle Revolving Credit Facility termination agreement (in thousands): Nine Months Ended August 31, 2019 Collection account balance at December 1, 2018 $ 28,059 Face value collected in current quarter 60,163 Face value collected in prior quarters 32,342 Other collections * 2,575 $ 123,139 Expenses paid from the collection account Post-Petition Premiums paid 2019 $ (65,905) Interest expenses (28,331) Payment toward principal (1,804) White Eagle credit facility expenses (9,304) Refund of premium payments advanced by parent (3,000) Lender allowed claim-Beal (5,839) Transfers of remaining funds to Lamington (8,956) $ (123,139) Collection account balance at August 16, 2019** $ — *Includes refund of premiums and interest earned on maturity proceeds ** Collection account was closed on August 16, 2019 in connection with the termination of the White Eagle Revolving Credit Facility. During the three months and nine months ended August 31, 2019, advances for premium payments and fees to service providers amounted to (in thousands): Three Months Ended August 31, Nine Months Ended August 31, 2019 2019 Amount drawn for premium payments $ — $ 4,221 Total amount drawn $ — $ 4,221 Interest. Borrowings under the White Eagle Revolving Credit Facility bear interest at a rate equal to LIBOR or, if LIBOR is unavailable, the base rate, in each case plus an applicable margin of 4.50%, which was increased from 4.00% pursuant to the November 9, 2015 amendment, and subject to a rate floor component equal to the greater of LIBOR (or the applicable rate) and 1.5%. The base rate under the White Eagle Revolving Credit Facility equals the sum of (i) the weighted average of the interest rates on overnight federal funds transactions or, if unavailable, the average of three federal funds quotations received by the Agent plus 0.75% and (ii) 0.5%. Based on the loan agreement, the LIBOR portion of the interest rate will re-adjust annually, once the floor has exceeded 1.5%. The applicable rate will be dependent on the rate at the last business day of the preceding calendar year. On December 31, 2018, the LIBOR floor increased from 2.11% to 3.01%. The effective rate at August 15, 2019 and August 31, 2018 was 9.51% and 6.61%, respectively. In the event that an Event of Default has occurred and is continuing, the interest rate will be equal to the sum of (i) the greater of (a) (1) LIBOR or, if LIBOR is unavailable, (2) the Base Rate and (b) one and a half percent (1.5%) plus (ii) six and a half percent (6.5%). Interest of approximately $23.3 million and $28.3 million was paid during the three months and nine months ended August 31, 2019. Maturity. Effective with the White Eagle Second Amendment, the term of the White Eagle Revolving Credit Facility expires December 31, 2031, which is also the scheduled commitment termination date (though the lenders’ commitments to fund borrowings may terminate earlier in an event of default). The lenders’ interests in and rights to a portion of the proceeds of the policies does not terminate with the repayment of the principal borrowed and interest accrued thereon, the termination of the White Eagle Revolving Credit Facility or expiration of the lenders’ commitments. Covenants/Events of Defaults . The White Eagle Revolving Credit Facility contains covenants and events of default that are customary for asset-based credit agreements of this type, but also include cross defaults under the servicing, account control, contribution and pledge agreements entered into in connection with the White Eagle Revolving Credit Facility (including in relation to breaches by third parties thereunder), certain changes in law, changes in control of or insolvency or bankruptcy of the Company and relevant subsidiary companies and performance of certain obligations by certain relevant subsidiary companies, White Eagle and third parties. Effective with the White Eagle Second Amendment, and as described above in "Amortization and Distributions", the White Eagle Revolving Credit Facility contains a financial covenant requiring White Eagle to maintain a cash interest coverage ratio of at least 1.75:1 commencing after June 30, 2019. Failure to maintain this ratio for 60 consecutive days after June 30, 2019 constitutes an event of default. There is no cash interest coverage ratio requirement that would result in an event of default prior to this date; however, any failure to maintain a cash interest coverage ratio of at least 2.0:1 does impact the cash flow sweep percentage for proceeds distributed through the waterfall. Remedies. The White Eagle Revolving Credit Facility and ancillary transaction documents afford the lenders a high degree of discretion in their selection and implementation of remedies, including strict foreclosure, in relation to any event of default, including a high degree of discretion in determining whether to foreclose upon and liquidate all or any pledged policies, the interests in White Eagle, and the manner of any such liquidation. White Eagle has limited ability to cure events of default through the sale of policies or the procurement of replacement financing. The Company elected to account for the debt under the White Eagle Revolving Credit Facility in accordance with ASC 820, Fair Value Measurements and Disclosures , which includes the 45% interest in policy proceeds to the lender, using the fair value method. The fair value of the debt is the amount the Company would have to pay to transfer the debt to a market participant in an orderly transaction. The Company calculated the fair value of the debt using a discounted cash flow model taking into account the stated interest rate of the credit facility and probabilistic cash flows from the pledged policies. Considerable judgment is required in interpreting market data to develop the estimates of fair value. Accordingly, the Company’s estimates are not necessarily indicative of the amounts that the Company, or holders of the instruments, could realize in a current market exchange. The most significant assumptions are the estimates of life expectancy of the insured and the discount rate. The use of different assumptions and/or estimation methodologies could have a material effect on the estimated fair values. Voluntary Petitions for Relief Under Chapter 11 On the Petition Date, Lamington and WEGP filed the November Chapter 11 Cases in the Bankruptcy Court. Lamington was the limited partner and owned 99.99%, and WEGP was the general partner and owned 0.01% of White Eagle. In its capacity as general partner, WEGP managed the affairs of White Eagle. The Lamington and WEGP filings are referred to as the "November Chapter 11 Cases." The commencement of the November Chapter 11 Cases constitutes an event of default under the White Eagle Revolving Credit Facility, resulting in the principal and accrued interest due from White Eagle thereunder becoming immediately due and payable. Lamington and WEGP have pledged their respective interests in White Eagle to secure its obligations under the White Eagle Revolving Credit Facility. Any efforts of CLMG to enforce such pledges by Lamington and WEGP of their respective interests in White Eagle in connection with the White Eagle Revolving Credit Facility are automatically stayed as a result of the commencement of the November Chapter 11 Cases and LNV’s and CLMG’s rights of enforcement in respect of the White Eagle Revolving Credit Facility are subject to the applicable provisions of the Bankruptcy Code. In addition, on November 15, 2018, White Eagle, LNV and CLMG entered into an Agreement Regarding Rights and Remedies (the "Standstill Agreement"), pursuant to which LNV and CLMG agreed to refrain from exercising their rights and remedies in connection with the White Eagle Revolving Credit Facility, subject to the terms and provisions of the Standstill Agreement, until 12:00 p.m. noon Pacific time on November 26, 2018, to facilitate negotiations. The effective period under the Standstill Agreement was extended several times, finally to December 13, 2018. On September 16, 2019, the Bankruptcy Court entered an order and final decree closing the White Eagle Chapter 11 Case. The Lamington and WEGP Chapter 11 Cases were closed on November 25, 2019. On December 13, 2018, White Eagle filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code in the Bankruptcy Court. The Chapter 11 case is being administered under case number 18-12808 (the "White Eagle Chapter 11 Case" and, together with the November Chapter 11 Cases, the "Chapter 11 Cases"). The commencement of the White Eagle Chapter 11 Case would constitute a default and event of default under the terms of the Amended and Restated Senior Note Indenture relating to the Company’s Amended and Restated Senior Secured Indenture and the New Convertible Note Indenture. However, such defaults and events of default and their consequences were waived in advance of the White Eagle Chapter 11 Case by holders of all of the outstanding principal amount of the 8.5% Senior Secured Notes and by holders of a majority of the outstanding principal amount of the outstanding New Convertible Notes, and consequently, the Company believes that no defaults, events of default or acceleration of the payment obligations thereunder, including principal or accrued interest, occurred under either the Company’s Amended and Restated Senior Secured Indenture or the New Convertible Note Indenture. The commencement of the White Eagle Chapter 11 Case, together with the related Chapter 11 Cases, constitutes an event of default under the White Eagle Revolving Credit Facility, resulting in the principal and accrued interest due from White Eagle thereunder becoming immediately due and payable. Lamington and WEGP have pledged their respective interests in White Eagle to secure its obligations under the White Eagle Revolving Credit Facility. Any efforts by LNV to enforce repayment by White Eagle and/or such pledges by Lamington and WEGP of their respective interests in White Eagle in connection with the White Eagle Revolving Credit Facility are automatically stayed as a result of the commencement of the Chapter 11 Cases and LNV’s and CLMG’s rights of enforcement in respect of the White Eagle Revolving Credit Facility are subject to the applicable provisions of the Bankruptcy Code. On September 16, 2019, the Bankruptcy Court entered an order and final decree closing the White Eagle Chapter 11 Case. The Lamington and WEGP Chapter 11 Cases were closed on November 25, 2019. Deconsolidation and Subsequent Measurement of the Deconsolidated Entities Lamington and its subsidiaries' (White Eagle, WEGP and Lamington Bermuda) financial results were excluded from the Company’s consolidated results for the period from November 14, 2018, the Petition Date, to August 16, 2019, the day the date the White Eagle Revolving Credit Facility was terminated. ASC 810, Consolidation require that an entity whose financial statements were previously consolidated with those of its parent that files for protection under the U.S. Bankruptcy Code, whether solvent or insolvent, generally must be prospectively deconsolidated from the parent and presented as an equity investment (deconsolidation applies to Lamington and all subsidiaries owned, directly or indirectly, by Lamington, including WEGP, White Eagle and Lamington Bermuda which collectively are referred to herein as the ("Deconsolidated Entities" or the "Debtors"). Therefore, our 2019 results are not comparable with our 2018 results. Under ASC 810, this loss of control would likely trigger a gain or loss for the parent as the parent would remeasure its retained noncontrolling investment at fair value each reporting period. We assessed the inherent uncertainties associated with the outcome of the Chapter 11 reorganization process and the anticipated duration thereof, and concluded that it was appropriate to deconsolidate Lamington and its subsidiaries effective on the Petition Date. Effective August 17, 2019, the entities were deemed to have emerged from bankruptcy and were no longer deconsolidated. See Note 2, "Summary of Significant Accounting Policies - Reorganization and Consolidation" to the accompanying consolidated financial statements. Beal Litigation On January 25, 2019, the Company, White Eagle, Lamington, and WEGP (collectively the "Plaintiffs" filed the Suit against LNV, Silver Point and GWG the "Defendants") in the Bankruptcy Court where the Suit will be administered together with the previously filed Chapter 11 Cases. LNV, a subsidiary of Beal, is the lender under the White Eagle Revolving Credit Facility. In the Suit, the Plaintiffs allege that the Defendants engaged in a scheme to coerce the Plaintiffs into selling their valuable portfolio of life insurance policies to defendants for well below its true value. Pursuant to the White Eagle Revolving Credit Facility, LNV agreed to lend $370 million to White Eagle, and in connection therewith received a 45% equity stake in White Eagle. That equity stake, and LNV’s significant control over White Eagle under the White Eagle Revolving Credit Facility, creates a joint venture, and gives rise to fiduciary duties to White Eagle and Emergent, on the part of LNV. The Plaintiffs further allege that LNV has been engaged in a concerted campaign to "squeeze" White Eagle and Emergent by improperly restricting their cash flow, in the hopes that White Eagle and Emergent will have no choice but to sell the valuable policy portfolio to LNV or one of its proxies, including Silver Point and/or GWG, at below its true value. In connection with the White Eagle Chapter 11 Case, on January 15, 2019, the Court authorized the Debtors to use the proceeds of pre-petition cash collateral for a period of twenty (20) weeks (the "Cash Collateral"), which allowance was extended in May 2019 for another nine (9) weeks. The Cash Collateral may be used solely for the purposes permitted under the budget approved by the Court, including (i) to provide working capital needs of the Debtors and general corporate purposes of the Debtors, (ii) to make the payments or fund amounts otherwise permitted in the final order that authorized such uses and such budget, (iii) to fund amounts necessary to pay certain fees; and (iv) to fund amounts necessary to pay certain professional fees in accordance with such Budget. Global Settlement Agreement in Principle in Bankruptcies On May 7, 2019, the Proposed Settlement, a global settlement in principle of the Chapter 11 Cases and the Suit, was announced on the record to, and filed with, the Bankruptcy Court jointly by the Debtors and Defendants. The Proposed Settlement would be effected together with the plan of reorganization, in accordance with the following schedule: (x) the Proposed Settlement and plan of reorganization, and other relevant documents, would be filed with the Bankruptcy Court by May 24, 2019, (y) the parties would use their best efforts to have the Proposed Settlement approved by the Bankruptcy Court by June 7, 2019, and (z) the parties would use their best efforts to have a confirmation hearing for approval of the plan of reorganization by the Bankruptcy Court held on or before June 21, 2019. Pursuant to the Proposed Settlement, among other things: • White Eagle shall have up to and including September 17, 2019 to satisfy any and all obligations to LNV under the Credit Facility by paying LNV 102% of its outstanding principal plus accrued interest at the relevant default rate, accrued fees and costs, which aggregate amount would include the resolution of the 45% participation interest element of the Credit Facility which was part of the subject matter of the Suit; • If White Eagle satisfies such obligations after September 17, 2019 and by December 30, 2019, the amount due on the outstanding principal would increase to 104%; • In the event LNV has not received the payoff described above by September 17, 2019, the court-appointed liquidation trustee, together with investment banking assistance from Maple Life Financial, LLC, shall have full authority to sell White Eagle’s life insurance policy portfolio (which constitutes collateral under the Credit Facility) for the maximum amount achievable through an orderly sale process, taking into account that the transaction must be closed no later than December 30, 2019; in connection with this authority, the liquidation trustee and the investment banker may work prior to September 17, 2019 to prepare the portfolio for sale, but may not take actions to actually commence a sale including, but not limited to, marketing the portfolio or contacting potential buyers about the portfolio, prior to such date; • If the portfolio is sold in whole or in part, LNV shall only have the right to step in to bid for such sale if, and to the extent, the total amounts generated through the sale thereof do not fully satisfy the payoff amount; and • If the sale of any portion of the Collateral has not closed or the proceeds of such sale(s) have not been received by CLMG by December 30, 2019, (i) if the Payoff Amount has not then been paid in cash in full, such Collateral shall be transferred on or before Noon Eastern on December 31, 2019 to CLMG (or its designee) in full satisfaction of the remaining unpaid portion of the amounts due to LNV. In addition, in order to provide sufficient cash flow to the Company during this period, and subject to negotiation of mutually-agreed upon terms and conditions, the Debtors shall have the right to use proceeds from the maturity of any portfolio policy and resolution of certain claims, and LNV will provide the Debtors a revolving $15.0 million of debtor-in-possession financing (which amount may be increased if found to be insufficient) through December 30, 2019 (the "DIP Financing"). Plan of Reorganization On June 5, 2019, the Bankruptcy Court approved the Settlement Agreement memorializing the Proposed Settlement and the DIP Financing. The Plan of Reorganization for the Chapter 11 Cases, which implements the Settlement Agreement and the DIP Financing, was confirmed by the Bankruptcy Court on June 19, 2019. On July 18, 2019, the Company entered into the Commitment Letter with Lamington, White Eagle and Jade Mountain in connection with the Plan of Reorganization. The Commitment Letter provided for a transaction in which Jade Mountain and/or certain of its affiliates and/or certain investors would acquire 72.5% of the equity interests of White Eagle in exchange for $384.3 million as may be adjusted in accordance with the final documentation. The Commitment Letter and its terms and the transactions contemplated thereby were approved by the Bankruptcy Court on July 22, 2019. Repayment and Termination of the White Eagle Revolving Credit Facility On August 16, 2019, the Company entered into the Subscription Agreement, in connection with the Commitment Letter, pursuant to which White Eagle sold to Palomino 72.5% of its limited partnership interests, consisting of all of the newly issued and outstanding Class A and Class D interests, and WEGP sold to an affiliate of Jade Mountain all of its general partnership interests for a purchase price of approximately $366.2 million and $8.0 million for the Class A and Class D interests, respectively. Pursuant to the Subscription Agreement, Lamington retained 27.5% of the limited partnership interests of White Eagle, consisting of all of the newly issued and outstanding Class B interests in exchange for all of its previously owned White Eagle limited partnership interests with a value of approximately $138.9 million on the closing date. The proceeds of the WE Investment were used to satisfy in full (i) the White Eagle Revolving Credit Facility, and (ii) the DIP Financing extended by CLMG, as agent, and LNV, as lender, to White Eagle, each in connection with the termination of the White Eagle Revolving Credit Facility and the release of the related liens on the collateral thereunder pursuant to the Master Termination Agreement. The repayment and termination of the White Eagle Revolving Credit Facility and the termination of the DIP Financing, which had not been drawn against, were in accordance with the Plan of Reorganization. |
8.50% Senior Unsecured Converti
8.50% Senior Unsecured Convertible Notes | 9 Months Ended |
Aug. 31, 2020 | |
8.5% Convertible Notes | |
Debt Instrument [Line Items] | |
Senior Notes | 8.50% Senior Unsecured Convertible Notes In February 2014, the Company issued $70.7 million in an aggregate principal amount of 8.50% senior unsecured convertible notes due 2019 (the "Convertible Notes" or "8.5% Convertible Notes"). The Convertible Notes were issued pursuant to an indenture dated February 21, 2014, between the Company and U.S. Bank National Association, as trustee (the "Convertible Note Indenture"). The maturity date of the Convertible Notes is February 15, 2019. The Convertible Notes accrue interest at the rate of 8.50% per annum on the principal amount of the Convertible Notes, payable semi-annually in arrears on August 15 and February 15 of each year. On March 14, 2017, the Company issued Additional Convertible Notes for an aggregate principal amount of $3.5 million in lieu of a cash payment of interest on the Convertible Notes. On July 26, 2017, the Company’s offer to exchange its outstanding $74.2 million aggregate principal amount of Convertible Notes for its New Convertible Notes expired. Holders of at least 98% of the Convertible Notes tendered in the Convertible Note Exchange Offer. On July 28, 2017, the Company consummated a series of integrated transactions to effect a recapitalization of the Company (the "Transaction Closing") pursuant to the Master Transaction Agreements, which transactions included the consummation of the Convertible Note Exchange Offer. The amount exchanged included approximately $73.0 million of principal outstanding prior to the exchange and approximately $2.8 million of interest paid in kind at the exchange date. The outstanding principal amount of the Convertible Notes after the exchange was approximately $1.2 million. On August 28, 2019, the Company paid off the outstanding principal and accrued interest on its Convertible Notes, consisting of $1.2 million in principal, $110,000 in accrued and unpaid interest and $38,000 in administrative fees and expenses. The Convertible Notes matured on February 15, 2019. Upon the payoff, the Convertible Notes were extinguished. The Company recorded $22,000 of interest expense on the Convertible Notes during the three months ended August 31, 2019. The Company recorded $93,000 of interest expense on the Convertible Notes during the nine months ended August 31, 2019, which included $73,000, $18,000 and $3,000 from interest, amortizing debt discounts and origination costs, respectively. |
5.0% Senior Unsecured Convertib
5.0% Senior Unsecured Convertible Notes | 9 Months Ended |
Aug. 31, 2020 | |
5.0% Convertible Notes | |
Debt Instrument [Line Items] | |
Senior Notes | 5.0% Senior Unsecured Convertible Notes On July 26, 2017, the Company’s Convertible Note Exchange Offer expired. Holders of at least 98% of the Convertible Notes tendered in the Convertible Note Exchange Offer. In connection with the Transaction Closing, the Company caused to be issued the New Convertible Notes in an aggregate amount of approximately $75.8 million pursuant to an Indenture the ("New Convertible Note Indenture") between the Company and U.S. Bank, National Association, as indenture trustee. The terms of the New Convertible Notes are governed by the New Convertible Note Indenture, which provide, among other things, that the New Convertible Notes are unsecured senior obligations of the Company and will mature on February 15, 2023. The New Convertible Notes bear interest at a rate of 5.0% per annum from the issue date, payable semi-annually on August 15 and February 15 of each year, beginning on August 15, 2017. Holders of New Convertible Notes may convert their New Convertible Notes at their option on any day prior to the close of business on the second scheduled trading day immediately preceding February 15, 2023. Upon conversion, the Company will deliver shares of Common Stock, together with any cash payment for any fractional share of Common Stock. The initial conversion rate for the New Convertible Notes denominated in $1,000 increments will be 500 shares of Common Stock per $1,000 principal amount of New Convertible Notes, which corresponds to an initial conversion price of approximately $2.00 per share of Common Stock. The initial conversion rate for the New Convertible Notes denominated in $1.00 increments will be 0.5 shares of Common Stock per $1.00 principal amount of New Convertible Notes, which corresponds to an initial conversion price of approximately $2.00 per share of Common Stock. The conversion rate will be subject to adjustment in certain circumstances. The Company may redeem, in whole but not in part, the New Convertible Notes at a redemption price of 100% of the principal amount of the New Convertible Notes to be redeemed, plus accrued and unpaid interest and additional interest, if any, if and only if the last reported sale price of the Common Stock equals or exceeds 120% of the conversion price for at least 15 trading days in any period of 30 consecutive trading days. The Company may, at its election, pay or deliver as the case may be, to all Holders of the New Convertible Notes, either (a) solely cash, (b) solely shares of Common Stock, or (c) a combination of cash and shares of Common Stock. The provisions of the New Convertible Note Indenture include a make-whole provision to compensate the Company’s debt holders for the lost option time value and forgone interest payments upon the Company experiencing a Fundamental Change (as defined in the New Convertible Note Indenture). These Fundamental Changes revolve around change in beneficial ownership, the consummation of specified transactions which result in the conversion of common stock into other assets or the sale, transfer or lease of all or substantially all of the Company’s assets, a majority change in the composition of the Company’s Board of Directors, the Company’s stockholders approval of any plan for liquidation of dissolution of the Company, and the Common Stock ceasing to be listed or quoted on a Trading Market. The number of incremental additional shares to be issued as a result of a Fundamental Change is based on a table which calculates the adjustment based on the inputs of time and share value. The New Convertible Note Indenture provides for customary events of default, which include (subject in certain cases to customary grace and cure periods), among others: nonpayment of principal or interest; breach of covenants or other agreements in the New Convertible Note Indenture; defaults or failure to pay certain other indebtedness; and certain events of bankruptcy or insolvency. Generally, if an event of default occurs and is continuing under the New Convertible Note Indenture, the trustee or the holders of at least 25% in aggregate principal amount of the New Convertible Notes then outstanding may declare all unpaid principal plus accrued interest on the New Convertible Notes immediately due and payable, subject to certain conditions set forth in the New Convertible Note Indenture. In addition, holders of the New Convertible Notes may require the Company to repurchase the New Convertible Notes upon the occurrence of certain designated events at a repurchase price of 100% of the principal amount of the New Convertible Notes, plus accrued and unpaid interest. The New Convertible Note Indenture, among other things, includes provisions such as the Company’s failure to timely file any document or report that is required to be filed with the SEC, as well as a registration statement covering the re-sale by holders of the New Convertible Notes not being declared effective by the SEC; the Company’s failure to cure such a default within 14 days after the occurrence will result in the Company being required to pay additional interest in cash. Additional interest on the New Convertible Notes will accrue with respect to the first 90-day period (or portion thereof) following the restricted transfer triggering date, which is 120 days after the last date on which any securities are originally issued under the New Convertible Note Indenture, or a registration statement regarding the resale by the holders of the securities or holders of any shares of common stock issuable upon conversion. For each day that a restricted transfer default is continuing at a rate equal to 0.25% per annum of the principal amount of New Convertible Notes, which rate will increase by an additional 0.25% per annum of the principal amount of the New Convertible Notes for each subsequent 90- day period (or portion thereof) while a restricted transfer default is continuing until all restricted transfer defaults have been cured, up to a maximum of 0.5% of the principal amount of the securities. Following the cure of all restricted transfer defaults, the accrual of additional interest arising from restricted transfer defaults will cease. The New Convertible Note Indenture states that the sole remedy for an event of default relating to the failure by the Company to comply with the provisions of the New Convertible Note Indenture requiring timely reporting by the Company and for any failure to comply with Section 314(a)(1) of the Trust Indenture Act shall, for the first 365 days after the occurrence of such an Event of Default, consist exclusively of the right to receive special interest on the New Convertible Notes at an annual rate equal to 0.50% of the principal amount of the New Convertible Notes. Repurchase of Notes On December 11, 2019, the Company redeemed $8.0 million principal amount of the 5.0% Convertible Notes in exchange for cash consideration of $4.8 million inclusive of unpaid interest of approximately $123,000. The Company incurred a net gain on extinguishment of approximately $2.8 million after expense for derivative and origination cost write off of approximately $442,000 and $66,000, respectively. Upon such redemption, the New Convertible Notes were surrendered and canceled. As of August 31, 2020, the outstanding principal of the New Convertible Notes is $67.8 million with a carrying value of $64.4 million, net of unamortized debt discounts and origination costs of $3.0 million and $441,000, respectively. These are being amortized over the remaining life of the New Convertible Notes using the effective interest method. During the three months ended August 31, 2020, the Company recorded $1.2 million of interest expense on the New Convertible Notes, including $848,000, $282,000 and $42,000 from interest, amortization of debt discount and origination costs, respectively, compared to interest expense of $1.3 million during the three months ended August 31, 2019, which included $948,000, $290,000 and $43,000 from interest, amortizing debt discounts and origination costs, respectively. During the nine months ended August 31, 2020, the Company recorded $3.4 million of interest expense on the 5.0% Convertible Notes, including $2.6 million, $776,000 and $115,000 from interest, amortization of debt discount and origination costs, respectively, compared to interest expense of $3.8 million during the nine months ended August 31, 2019, which included $2.8 million, $832,000 and $123,000 from interest, amortization of debt discount and origination costs, respectively. |
8.5% Senior Secured Notes
8.5% Senior Secured Notes | 9 Months Ended |
Aug. 31, 2020 | |
8.5% Senior Secured Notes | |
Debt Instrument [Line Items] | |
Senior Notes | 8.5% Senior Secured Notes In connection with the Transaction Closing, the Company and the Senior Secured Note Trustee entered into an Amended and Restated Senior Secured Note Indenture (the "Amended and Restated Senior Secured Indenture") to amend and restate the Senior Secured Indenture between the Company and the Senior Secured Note Trustee following the Company’s receipt of requisite consents of the holders of the 15% Senior Secured Notes. Pursuant to the terms of the Amended and Restated Senior Secured Indenture, the Company caused the cancellation of all outstanding 15% Senior Secured Notes and the issuance of 8.5% Senior Secured Notes due 2021 (the "8.5% Senior Secured Notes") in an aggregate amount of $30.0 million. The Amended and Restated Senior Secured Indenture provides, among other things, that the 8.5% Senior Secured Notes will be secured senior obligations of the Company and will mature on July 15, 2021. The 8.5% Senior Secured Notes will bear interest at a rate of 8.5% per annum, payable quarterly on March 15, June 15, September 15 and December 15 of each year, beginning on September 15, 2017. Certain holders of the Company's securities that are party to Board Designation Agreements (as discussed below), purchased approximately $24.5 million of the 8.5% Senior Secured Notes that were issued in exchange for 15% Senior Secured Notes during the year ended December 31, 2017. The Amended and Restated Senior Secured Indenture provides that the 8.5% Senior Secured Notes may be optionally redeemed in full by the Company at any time and must be redeemed in full upon additional issuances of debt by the Company, in each case at a price equal to 100% of the principal amount redeemed plus (i) accrued and unpaid interest on the 8.5% Senior Secured Notes redeemed, and (ii) the Applicable Premium, if any, as defined in the Amended and Restated Senior Secured Indenture. Upon a change of control, the Company will be required to make an offer to holders of the 8.5% Senior Secured Notes to repurchase the 8.5% Senior Secured Notes at a price equal to 107.5% of their principal amount, plus accrued and unpaid interest up to the date of redemption. The Amended and Restated Senior Secured Indenture contains negative covenants restricting additional debt incurred by the Company, creation of liens on the collateral securing the 8.5% Senior Secured Notes, and restrictions on dividends and stock repurchases, among other things. The 8.5% Senior Secured Notes are secured by settlement proceeds, if any, received from certain litigation involving the Company, certain notes issued to the Company, and pledges of 65% of the equity interests in Blue Heron Designated Activity Company, OLIPP IV, LLC and Red Reef Alternative Investments, LLC. On January 10, 2018, the Company commenced the process of appointing a liquidator to liquidate Blue Heron. The completion of liquidation formalities of Blue Heron under Irish law was completed in late 2019. In connection with liquidation of Blue Heron, the Company and Wilmington Trust, National Association, as trustee under the Amended and Restated Senior Secured Indenture (the "Trustee"), entered into (i) the First Supplemental Indenture (the "First Supplemental Indenture"), dated as of January 10, 2018, to implement certain amendments to the Indenture and (ii) the Amendment to Pledge and Security Agreement ("Pledge and Security Amendment"), dated as of January 10, 2018, to implement certain amendments to the Pledge and Security Agreement Pledge and Security Agreement, dated as of March 11, 2016, between the Company and Trustee. The First Supplemental Indenture and the Pledge and Security Amendment amend the Indenture and Pledge and Security Agreement, respectively, to: (i) remove from the assets pledged to the secured parties under the Amended and Restated Senior Secured Indenture, 65% of the equity and certain other assets of Blue Heron; and (ii) reflect the pledge by the Company, in favor of the secured parties under the Indenture, of the promissory note dated as of December 29, 2016 in the principal sum of $69.6 million issued by OLIPP IV, LLC to Blue Heron and subsequently assigned to the Company. The Amended and Restated Senior Secured Indenture provides for customary events of default which include (subject in certain cases to customary grace and cure periods), among others: nonpayment of principal or interest; breach of covenants or other agreements in the Amended and Restated Senior Secured Indenture; defaults in failure to pay certain other indebtedness; and certain events of bankruptcy or insolvency. Generally, if an event of default occurs and is continuing under the Amended and Restated Senior Secured Indenture, the trustee or the holders of at least 25% in aggregate principal amount of the 8.5% Senior Secured Notes then outstanding may declare the principal of and accrued but unpaid interest, plus a premium, if any, on all the 8.5% Senior Secured Notes immediately due and payable, subject to certain conditions set forth in the Amended and Restated Senior Secured Indenture. On August 11, 2017, the Company entered into a Securities Purchase Agreement (the "Securities Purchase Agreement") by and between the Company and Brennan Opportunities Fund I LP ("Brennan"). Pursuant to the Securities Purchase Agreement, Brennan purchased from the Company (i) 12,500,000 shares (the "Brennan Shares") of Common Stock at a price of $0.40 per share for an aggregate purchase price of $5.0 million and (ii) $5.0 million principal amount of the Company’s 8.5% Senior Secured Notes (the "Brennan Notes," and together with the Brennan Shares, the "Brennan Securities"). The Securities Purchase Agreement contained customary representations, warranties, and covenants. The sale of the Brennan Securities was consummated on August 11, 2017, as to 8,750,000 shares of Common Stock and $3.5 million principal amount of 8.5% Senior Secured Notes, and on August 14, 2017, as to 3,750,000 shares of Common Stock and $1.5 million principal amount of 8.5% Senior Secured Notes. On December 10, 2018, the Company and Wilmington Trust, National Association, as indenture trustee, entered into a Second Supplemental Indenture (the "Second Supplemental Indenture") which amended the Amended and Restated Indenture, dated as of July 28, 2017, as amended by the First Supplemental Indenture dated as of January 10, 2018 (as so amended, the "Indenture"), relating to the Company’s 8.5% Senior Secured Notes due July 15, 2021 (the "8.5% Senior Secured Notes"). The Second Supplemental Indenture (i) increased the aggregate principal amount of Notes permitted to be issued under the Indenture from $40.0 million to $70.0 million and (ii) provided for interest on the Notes to be paid in kind, such that the principal amount of the relevant holder’s note is increased by the amount of interest, in lieu of cash payment ("PIK"). The Company may elect to pay PIK interest instead of cash interest for any Interest Period (as defined in the Indenture) to holders of Notes who consented to accept PIK interest. Each holder of outstanding Notes made an election with respect to some or all of the outstanding principal amount of such holder’s Notes as to whether or not to accept PIK interest whenever the Company elects to pay interest in PIK in lieu of cash. Any new holder of Notes, other than a transferee who is an affiliate of a transferring holder that did not elect to accept PIK interest, will be deemed to have elected to accept PIK interest. A holder receiving PIK interest shall also automatically receive, for each applicable Interest Period, an amount equal to 3.0% per annum of additional interest on the principal amount of such holder’s Notes for which the holder elected to accept PIK interest. Holders receiving PIK is approximately $26.8 million with approximately $8.2 million electing to be paid by cash. All terms of the Indenture that were not amended by the Second Supplemental Indenture remain in full force and effect. On December 28, 2018, the Company entered into subscription agreements (the "Subscription Agreements") with several investors (the "Investors"), Pursuant to the Subscription Agreements, the Investors purchased from the Company an aggregate of $5.7 million principal amount of the Company’s 8.5% Senior Secured Notes for an aggregate purchase price of $4.3 million. The transactions were consummated on December 28, 2018. On December 28, 2018, the Company received a commitment letter (the "Commitment Letter") from Ironsides Partners LLC, an entity affiliated with Robert Knapp, a member of the Board, for an aggregate investment, at the Company’s election, of up to $2.0 million principal amount of 8.5% Senior Secured Notes for an aggregate purchase price of up to $1.5 million no later than January 31, 2019. The Commitment Letter contains certain conditions precedent to Ironsides’ obligations to purchase such Senior Notes. On January 30, 2019, the Company entered into a Note Purchase Agreement (the "Note Purchase Agreement") with Ironsides Partners Special Situations Master Fund III L.P. (the "Investor"), which is affiliated with Robert Knapp, a member of the Company’s Board of Directors. Pursuant to the Note Purchase Agreement, the Investor purchased from the Company $2.0 million principal amount of the Company’s 8.5% Senior Secured Notes for a purchase price of $1.5 million. On February 11, 2019, the Company entered into a Subscription Agreement (the "Subscription Agreement") with Brennan Opportunities Fund I LP (the "Investor"), which is affiliated with Patrick T. Brennan, a member of the Company’s Board of Directors. Pursuant to the Subscription Agreement, the Investor purchased from the Company $967,000 principal amount of the Company’s 8.5% Senior Secured Notes (the "Senior Notes") for a purchase price of $725,000. The transaction was consummated on February 14, 2019. The Company issued an additional $4.0 million in additional 8.5% Senior Secured Notes in lieu of a cash payment of interest to the relevant holders of the notes during the year ended November 30, 2019. At August 31, 2020, the outstanding principal of the 8.5% Senior Secured Notes was $47.6 million with a carrying value of $46.5 million, net of discount and unamortized debt issuance cost of $904,000 and $205,000, respectively. During the three months ended August 31, 2020, the Company recorded approximately $1.6 million of interest expense on the 8.5% Senior Secured Notes, which includes $1.3 million of interest expense, $54,000 of amortizing debt issuance costs and $231,000 of amortizing of debt discount, respectively, compared to approximately $1.5 million of interest expense on the 8.5% Senior Secured Notes, during the three months ended August 31, 2019, which includes $1.3 million of interest and $76,000 of amortizing debt issuance costs, and $152,000 of amortizing of debt discount, respectively. During the nine months ended August 31, 2020, the Company recorded approximately $4.2 million of interest expense on the 8.5% Senior Secured Notes, which includes $3.3 million of interest and $156,000 of amortizing debt issuance costs and $660,000 of amortizing of debt discount respectively, compared to approximately $4.4 million of interest expense on the 8.5% Senior Secured Notes, during the nine months ended August 31, 2019, which includes $3.8 million of interest and $209,000 of amortizing debt issuance costs and $346,000 of amortizing of debt discount respectively. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Aug. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The Company carries investment in limited partnership, life settlements and investment in deconsolidated subsidiaries at fair value. As of August 31, 2020, life settlements and investment in deconsolidated subsidiaries are no longer held on the Company's consolidated balance sheet. Fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, fair value is a market based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. Fair value measurements are classified based on the following fair value hierarchy: Level 1 -Valuation is based on unadjusted quoted prices in active markets for identical assets and liabilities that are accessible at the reporting date. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these products does not entail a significant degree of judgment. Level 2 -Valuation is determined from pricing inputs that are other than quoted prices in active markets that are either directly or indirectly observable as of the reporting date. Observable inputs include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, and interest rates and yield curves that are observable at commonly quoted intervals. Level 3 -Valuation is based on inputs that are both significant to the fair value measurement and unobservable. Level 3 inputs include situations where there is little, if any, market activity for the financial instrument. The inputs into the determination of fair value generally require significant management judgment or estimation. Assets measured at fair value on a recurring basis The balances of the Company’s assets measured at fair value on a recurring basis as of August 31, 2020, are as follows (in thousands): Level 1 Level 2 Level 3 Total Fair Value Assets: Investment in limited partnership $ — $ — $ 152,450 $ 152,450 $ — $ — $ 152,450 $ 152,450 The balances of the Company’s assets measured at fair value on a recurring basis as of November 30, 2019, are as follows (in thousands): Level 1 Level 2 Level 3 Total Fair Assets: Investment in limited partnership $ — $ — $ 137,849 $ 137,849 Investment in life settlements — — 1,297 1,297 $ — $ — $ 139,146 $ 139,146 The below is a quantitative analysis of the Company's level 3 assets fair value measurements at August 31, 2020: ($ in thousands) Quantitative Information about Level 3 Fair Value Measurements Fair Value Aggregate Valuation Technique Unobservable Input Range (Weighted Average) Investment in limited partnership $ 152,450 $ 663,033 Discounted cash flow Discount rate 14.04% Life expectancy evaluation, distributions, return on investment Following is a description of the methodologies used to estimate the fair values of assets measured at fair value on a recurring basis and within the fair value hierarchy which is our investment in limited partnership which holds a portfolio of life settlements for the nine months ended August 31, 2020. At August 31, 2020, the Company did not directly own any life settlement, as a result, the analysis included is for the nine months ended August 31, 2019 for this category. Investment in limited partnership - In connection with the WE Investment, the Limited Partnership Agreement of White Eagle was amended and restated (the "A&R LPA") to provide for the issuance of the Class A, B and D limited partnership interests, and for funding of an "Advance Facility" evidenced by the Class D limited partnership interests, to maintain reserves sufficient to fund premiums, certain operating expenses of White Eagle and certain minimum payments to Lamington as the holder of the Class B interests. The A&R LPA provides generally that holders of the Class A and Class B Interests receive distributions of proceeds of the assets of White Eagle based on their 72.5% and 27.5% ownership, respectively, after certain expenses and reserves are funded (including such minimum payments to Lamington totaling approximately $8.0 million per year for the first three (3) years and $4.0 million for the subsequent seven (7) years, provided that commencing after year three (3), such minimum payments will be utilized to repay the Class D Return of $8.0 million, which was advanced at closing, plus the greater of $2.0 million or 11% per annum on such $8.0 million to the extent necessary to fully repay such Class D Return. The minimum payments to the Company will occur regardless of maturities with payments through the premium/expense reserve account when there are no maturity proceeds available for distribution as described below). However, the A&R LPA also provides that all payments to holders of the Class B interests (other than such minimum payments to Lamington during the first eight (8) years following the Closing Date) are fully subordinated to payments in respect of the minimum returns to holders of the Class A and Class D interests (including repayment of all amounts advanced in respect of the Advance Facility) and to any indemnification payments, if any, due to such holders and related indemnified persons pursuant to the indemnities afforded them in and in relation to the A&R LPA, Subscription Agreement, Master Termination Agreement and related documents. ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities requires that a reporting entity should account for its equity investments that are not consolidated or accounted for under the equity method at fair value, with changes to fair value recorded in current earnings. White Eagle previously valued its life settlement policies at fair value whose valuation are based on inputs that are both significant to the fair value measurement and unobservable. The Company now holds an equity investment of 27.5% in White Eagle whose only assets are these life settlements. Additionally, the investment includes a mezzanine financing which the Company assumed at closing which repayment by, and ultimate distributions to, the Company are based on a prescribed waterfall with a guaranteed 11% return to the majority owner partner. The Company will utilize a fair value approach to account for its 27.5% investment in White Eagle, and the calculation will be performed consistent with ASC 820, Fair Value Measurement with changes in fair value recorded in current earnings. The Company performed a valuation at August 31, 2020 resulting in a value of approximately $152.5 million using an estimated discount rate of approximately 14.04%. See Note 11, "Investment in Limited Partnership" , to the accompanying consolidated financial statements for further information. Discount rate of investment in limited partnership The discount rate incorporates current information about market interest rates, the credit exposure to the insurance company that issued the life insurance policy, the Company's estimates of the return and investor would require and the current rate of return of the major partner. The Company re-evaluates its discount rates at the end of every reporting period in order to reflect the estimated discount rates that could reasonably be used in a market transaction involving the Company’s 27.5% investment in White Eagle. In doing so, consideration is given to the various factors influencing the rates, including risk tolerance and market activity. The Company relies on management insight, engages third party consultants to corroborate its assessment and engages in discussions with other market participants. In considering these factors, at August 31, 2020, the Company determined that the estimated discount rate was 14.04%. Market interest rate sensitivity analysis of the investment in limited partnership The extent to which the fair value of the investment in limited partnership could vary in the near term has been quantified by evaluating the effect of changes in the weighted average discount. If the weighted average discount rate were increased or decreased by 1/2 of 1% and the other assumptions used to estimate fair value remained the same, the change in estimated fair value of investment in limited partnership as of August 31, 2020 would be as follows (dollars in thousands): Weighted Average Rate Rate Adjustment Value Change in Value 13.54% (0.50) % $ 156,438 $ 3,988 14.04% — $ 152,450 $ — 14.54% 0.50 % $ 148,616 $ (3,834) Life settlements - The Company previously owned a portfolio of life settlements. With the sale of the 72.5% interest in White Eagle and the Sun Life settlement, the Company no longer owns life settlements. During the period of ownership, the Company elected to account for the life settlement policies it acquires using the fair value method. The Company used a present value technique to estimate the fair value of its life settlements, which is a Level 3 fair value measurement as the significant inputs are unobservable and require significant management judgment or estimation. The Company used a probabilistic method of valuing the life insurance policies, which the Company believes to be the preferred valuation method in the industry. The most significant assumptions were the estimates of life expectancy of the insured and the discount rate. Investment in deconsolidated subsidiaries - As previously discussed in Note 4, "Deconsolidation of Subsidiaries" upon the deconsolidation of Lamington, the Company recorded an investment which was equivalent to the carrying value of Lamington's net assets at fair value. The Company calculated the fair value using unobservable inputs, primarily discounted cash flow analysis which required significant management judgment due to the absence of quoted market prices or observable inputs for assets of similar nature, hence, we utilized a discounted cash flow analysis considering the anticipated date the Company would emerge from bankruptcy, the settlement amount of the debt under the then White Eagle Revolving Credit Facility, and future expenses. The calculation resulted in a fair value of approximately $128.8 million at November 30, 2018, the Company further evaluate its investment at August 16, 2019 and recognized a gain of approximately $37.9 million, the amount is reflected in current earnings as change in fair value of investment in deconsolidated subsidiaries. The amount is associated with gains incurred by Lamington for the period up to August 16, 2019 in considering the proceeds received through the transaction for the Subscription Agreement, the actual payoff of the White Eagle Revolving Credit Facility and all other third party claims. Effective August 16, 2019, Lamington was reconsolidated under the provisions of ASC 810, Consolidation. Changes in Fair Value The following tables provides a roll-forward in the changes in fair value for the nine months ended August 31, 2020, for all assets for which the Company determines fair value using a material level of unobservable (Level 3) inputs (in thousands): Life Settlements - Consolidated: Balance, December 1, 2019 $ 1,297 Sale of policies (2,040) Gain on sale of life settlement 743 Change in fair value — Premiums paid — Balance, August 31, 2020 $ — Changes in fair value included in earnings for the period relating to assets held at August 31, 2020 $ — Investment in Limited Partnership Balance, December 1, 2019 $ 137,849 Change in fair value 20,601 Distributions (6,000) Balance, August 31, 2020 $ 152,450 Changes in fair value included in earnings for the period relating to assets held at August 31, 2020 $ 14,601 The following tables provides a roll-forward in the changes in fair value for the periods ended August 31, 2019, for all assets for which the Company determines fair value using a material level of unobservable (Level 3) inputs, which consists solely of life settlements (in thousands): Life Settlements - Consolidated: Balance, December 1, 2018 $ 1,172 Purchase of policies — Change in fair value (37) Matured/lapsed/sold polices — Premiums paid 118 Balance, August 31, 2019 $ 1,253 Changes in fair value included in earnings for the period relating to assets held at August 31, 2019 $ (37) Life Settlements - Deconsolidated: Balance, December 1, 2018 $ 505,235 Purchase of policies — Change in fair value (16,841) Receivable for maturity of life settlement write off 17,800 Policies sold (344,845) Policies matured (100,373) Premiums paid 69,827 Transfer to investment in limited partnership (130,803) Balance at, August 31, 2019 $ — Changes in fair value included in earnings for the period relating to deconsolidated assets held at August 31, 2019 $ — The following tables provides a roll-forward in the changes in fair value for the periods ended August 31, 2019, for the White Eagle Revolving Credit Facility for which the Company determines fair value using a material level of unobservable (Level 3) inputs (in thousands): White Eagle Revolving Credit Facility - Deconsolidated: Balance, December 1, 2018 $ 346,670 Draws under the White Eagle Revolving Credit Facility 4,221 Payments on White Eagle Revolving Credit Facility (367,985) Unrealized change in fair value 17,094 Balance, August 31, 2019 $ — Changes in fair value included in earnings for the period relating to liabilities at August 31, 2019 $ — The following table provides a roll-forward in the changes in fair value for the period ended August 31, 2019, for the investment in deconsolidated subsidiaries for which the Company determines fair value using a material level of unobservable (Level 3) inputs (in thousands): Investment in Deconsolidated Subsidiaries Investment in Lamington at December 1, 2018 $ 128,795 Change in fair value 37,941 Transferred to consolidation (166,736) Investment in Lamington at August 31, 2019 $ — There were no transfers of financial assets or liabilities between levels of the fair value hierarchy during the nine months ended August 31, 2020 and 2019. Other Fair Value Considerations - Carrying value of certificate of deposits, prepaid expenses and other assets, 8.5% Senior Secured Notes, 5.0% Senior Unsecured Convertible Notes, accounts payable and accrued expenses approximate fair value due to their short-term maturities and/or low credit risk. |
Segment Information
Segment Information | 9 Months Ended |
Aug. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information On October 25, 2013, the Company sold its structured settlement business, which was previously reported as an operating segment. The operating results related to the Company’s structured settlement business have been included in discontinued operations in the Company’s Consolidated Statements of Operations for all periods presented and the Company has discontinued segment reporting. See Note 9 "Discontinued Operations" |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Aug. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Lease Agreements Effective December 1, 2019, the Company adopted ASC 842, Leases , which requires lessees to recognize on the balance sheet at lease commencement, the lease assets and the related lease liabilities for the rights and obligations created by operating and finance leases with lease terms of more than 12 months. The lease term commences on the date the lessor makes the underlying property available, irrespective of when lease payment begins under the contract. The Company leases office space under a lease that commenced on October 1, 2014. The lease expires on September 30, 2020. The annual base rent is $268,000, with a provision for a 3% increase on each anniversary of the rent commencement date. Upon adoption, our lease liability was $203,000 and was calculated based on the present value of the minimum lease payments from December 1, 2019 to September 30, 2020, the lease expiration date, consisting of the base rent, provision for a 3% increase on each anniversary of the rent commencement date and our incremental borrowing rate applicable to the lease term. The interest rate used in our calculation is estimated and was derived using the interest rate we pay on our existing borrowings, adjusted for other factors which requires judgment by management. The lease liability is increased by accreted interest and reduced by the lease payment made by the Company on a monthly basis. At August 31, 2020, there was no operating lease liability The Company initially measured the right-of-use asset ("ROU asset" or "operating lease asset") at the initial measurement of the lease liability, adjusted for payments made before the commencement date and lease incentives received before the commencement date, which resulted in an initial ROU assets value of approximately $179,000. At August 31, 2020, the operating lease asset was $22,000 and is included under assets on the consolidated balance sheet. Over the lease term, the Company is required to amortize the ROU asset and record interest expense on the lease liability created at lease commencement. Operating lease expense was approximately $107,000 for the three months ended August 31, 2020 and $352,000 for the nine months ended August 31, 2020. Rent expense was $104,000 for the three months ended August 31, 2019 and $332,000 for the nine months ended August 31, 2019. Effective September 30, 2020 the lease expired. Short Term Lease On August 5, 2020, the Company signed a lease agreement for office space. The monthly base rent was $700 with a commencement date of September 1, 2020 and an expiration date of December 1, 2020. This Agreement lasts for the period beginning on September 1, 2020 and will then automatically renew for successive periods for the same duration as to the initial term, until terminated by either party in accordance with the terms and conditions of the lease agreement. Sublease Agreement During the eleven months ended November 30, 2018, the Company entered into a sublease agreement with a subtenant that commenced on October 1, 2018 and expires on September 15, 2020. The annual base rent of the subtenant is $78,000. On March 11, 2019, the sublease contract was amended to increase the square footage thereunder, hence increasing the annual base rent to $89,000. Effective July 31, 2020, the sublease was terminated. The sublease did not relieve the Company of its primary obligation under the original lease. As a result, the Company will continue to account for the original lease as an operating lease independent of the sublease agreement, in terms of balance sheet presentation. Rental income is recognized on a monthly basis and was approximately $29,000 and $41,000, respectively, for the three months ended August 31, 2020 and three months ended August 31, 2019, respectively, $119,000 and $117,000, respectively, for the nine months ended August 31, 2020 and nine months ended August 31, 2019, respectively and is included as other income in the consolidated statements of operations. Employment Agreements The Company has entered into employment agreements with certain of its officers, including with its chief financial officer, whose agreement provides for payments in the event that the executive terminates her employment with the Company due to a material change in the geographic location where the chief financial officer performs her duties or upon a material diminution of her base salary or responsibilities, with or without cause (the "2018 Martinez Agreement"). If the Company terminates the 2018 Martinez Agreement without cause or she resigns with Good Reason (as defined in the 2018 Martinez Agreement), she will be entitled to receive her base salary or $352,229, whichever is greater, through the twelve (12) months following such termination (the "Martinez Severance Period") as well as any bonus earned but not yet paid. If Ms. Martinez resigns for good reason, she will also be entitled to have the Company continue to pay its portion of healthcare premiums for plans in which she is participating immediately prior to the termination through the Martinez Severance Period. If such termination or resignation occurs within two years after a change in control (as defined in the 2018 Martinez Agreement), then in lieu of receiving her base salary, Ms. Martinez would be entitled to receive (i) accrued vacation days, (ii) a lump sum payment equal to the sum of two times her then base salary, (iii) a portion of her bonus prorated through the termination date that would be due to her when bonus payments are otherwise made for the year in which the termination occurs, (iv) any unpaid portion of a bonus for the year preceding the termination, and (v) reimbursement of COBRA healthcare costs through the Martinez Severance Period. On March 13, 2018, the Company entered into an employment agreement with Jack Simony (the "Simony Agreement"), pursuant to which Mr. Simony will continue to serve as Vice President and Chief Investment Officer of the Company. The term of the Simony Agreement commenced on March 13, 2018 and continues for one year, with automatic one-year extensions unless (x) either Mr. Simony or the Company gives written notice not to extend at least sixty (60) days’ prior to the end of the then-current term or (y) Mr. Simony’s employment is terminated in accordance with the terms of the Simony Agreement. Pursuant to the Simony Agreement, Mr. Simony will receive an annual base salary of $275,000. The Simony Agreement further provides that Mr. Simony is entitled to participate in all benefit plans provided to executives of the Company. If the Company terminates Mr. Simony’s employment without cause or he resigns with Good Reason (as defined in the Simony Agreement), the Simony Agreement provides that he will be entitled to receive his base salary through the six (6) months following such termination (the "Simony Severance Period") as well as any incentive bonus that has been declared or awarded to him for a prior fiscal year but has not yet been paid. If Mr. Simony resigns for good reason, he will also be entitled to have the Company continue to pay its portion of health care premiums for plans in which he is participating immediately prior to the termination through the Simony Severance Period. On March 13, 2018, the Company entered into an employment agreement with Harvey Werblowsky (the "Werblowsky Agreement"), pursuant to which Mr. Werblowsky will continue to serve as Vice President, Chief Legal Officer and General Counsel of the Company. The term of the Werblowsky Agreement commenced on March 13, 2018 and continues for one year, with automatic one-year extensions unless (x) either Mr. Werblowsky or the Company gives written notice not to extend at least sixty (60) days’ prior to the end of the then-current term or (y) Mr. Werblowsky’s employment is terminated in accordance with the terms of the Werblowsky Agreement. Pursuant to the Werblowsky Agreement, Mr. Werblowsky will receive an annual base salary of $250,000. The Werblowsky Agreement further provides that Mr. Werblowsky is entitled to participate in all benefit plans provided to executives of the Company. If the Company terminates Mr. Werblowsky’s employment without cause or he resigns with Good Reason (as defined in the Werblowsky Agreement), the Werblowsky Agreement provides that he will be entitled to receive his base salary through the six (6) months following such termination (the "Werblowsky Severance Period") as well as any incentive bonus that has been declared or awarded to him for a prior fiscal year but has not yet been paid. If Mr. Werblowsky resigns for good reason, he will also be entitled to have the Company continue to pay its portion of health care premiums for plans in which he is participating immediately prior to the termination through the Werblowsky Severance Period. Severance Agreements On November 12, 2019, the Company entered into a retention agreement with each of Mr. Simony, (the "Simony Retention Agreement"), and Mr. Werblowsky, (the "Werblowsky Retention Agreement" and, together with the Simony Retention Agreement, the "Retention Agreements"). Each Retention Agreement provides for a cash retention payment (each, a "Retention Payment") and certain extended benefits to each of Mr. Simony and Mr. Werblowsky (the "Benefits") in recognition of his significant contributions to consummating the Company’s August 2019 transaction with Jade Mountain Partners, LLC, which allowed the Company and its then subsidiary White Eagle Asset Portfolio, L.P to refinance an onerous credit facility and improve the Company’s overall financial position (the "White Eagle Transaction"), and in consideration of Mr. Simony’s and Mr. Werblowsky’s continued support and assistance with the current restructuring under consideration by the Company (the "Restructuring"). The Retention Agreements provide that in exchange for the Retention Payment and Benefits, each of Mr. Simony and Mr. Werblowsky will remain employed by Imperial pursuant to his current employment agreement, each dated March 13, 2018 (the "Employment Agreements"), and that each Retention Payment is in lieu of any severance otherwise payable to Mr. Simony or Mr. Werblowsky under his Employment Agreement. In addition, each of Mr. Simony and Mr. Werblowsky will not be eligible to receive any portion of his Retention Payment if he is terminated for Cause (as defined in the Employment Agreements) or resigns without Good Reason (as defined in the Employment Agreements). The Retention Payments consist of $1.0 million for Mr. Simony and $500,000 for Mr. Werblowsky. The Benefits consist of, for each of Mr. Simony and Mr. Werblowsky, 12 months of (x) COBRA health insurance coverage reimbursement from the company and (x) other benefits to which he would be entitled upon an involuntary termination without Cause under his Employment Agreement. The Retention Payments are payable as to two-thirds upon entering into the Retention Agreements and one-third within three (3) business days of the consummation of the Restructuring, so long as the White Eagle Transaction remains in full force and effect and White Eagle and its limited partnership agreement remain operative and in good standing. On December 10, 2019, the Company, entered into a retention agreement with Miriam Martinez, the Company’s Senior Vice President, Chief Financial Officer and Secretary (the "Martinez Retention Agreement"). The Martinez Retention Agreement provides for a cash retention payment (the "Martinez Retention Payment") and certain extended benefits to Ms. Martinez (the "Martinez Benefits") in recognition of the significant contributions to consummating the Company’s August 2019 transaction with Jade Mountain, which allowed the Company and White Eagle to refinance the White Eagle Revolving Credit Facility and improve the Company’s overall financial position (the "White Eagle Transaction"), and in consideration of Ms. Martinez’s continued support and assistance with the Restructuring. The Martinez Retention Agreement provides that in exchange for the Martinez Retention Payment and Martinez Benefits, Ms. Martinez will remain employed by Imperial pursuant to the 2018 Martinez Agreement, and that the Martinez Retention Payment is in lieu of any severance otherwise payable to Ms. Martinez under the 2018 Martinez Agreement. In addition, Ms. Martinez will not be eligible to receive any portion of the Martinez Retention Payment if she is terminated for Cause (as defined in the 2018 Martinez Agreement) or resigns without Good Reason (as defined in the 2018 Martinez Agreement). The Martinez Retention Payment consists of $700,000. The Martinez Benefits consist of 18 months of (x) COBRA health insurance coverage reimbursement from the Company and (x) other benefits to which she would be entitled upon an involuntary termination without Cause under the 2018 Martinez Agreement. The Martinez Retention Payment is payable as to two-thirds upon entering into the Martinez Retention Agreement and one-third within three (3) business days of the consummation of the Restructuring, so long as the White Eagle Transaction remains in full force and effect and White Eagle and its limited partnership agreement remain operative and in good standing. In the event that the Company files for bankruptcy prior to the payment of any portion of the Martinez Retention Payment or Martinez Benefits, the Company will file with the bankruptcy court a motion to approve a Key Employee Retention Plan to preserve each of Ms. Martinez’s rights under the Martinez Retention Agreement to the full Martinez Retention Payment and Martinez Benefits provided that she must comply with all of the provisions of the Martinez Retention Agreement. Bonus - Chief Executive Officer On January 27, 2020, the Company, granted a bonus to Patrick J. Curry, the Company’s Chief Executive Officer (the "Bonus"), in recognition of his past and ongoing work for the Company. The Bonus consists of: (i) $400,000 in cash, payable promptly after the grant, and 1,000,000 shares of restricted common stock of Emergent, vesting in thirds upon the first three anniversaries of the grant date, (ii) up to $300,000 in cash, as determined by the Compensation Committee (the "Compensation Committee") of Emergent’s Board of Directors (the "Board"), payable upon the consummation of the Company’s contemplated restructuring, and (iii) up to $300,000 in cash, as determined by the Compensation Committee, if the Company effects the Restructuring at least $600,000 under the budget for such Restructuring that is approved by the Board within 45 days of the date hereof, measured as of 30 days after the date of the Restructuring. Resignation - Chief Investment Officer On January 29, 2020, Jack Simony, the Company’s Chief Investment Officer, notified the Company of his resignation, effective on February 7, 2020. Also, on January 29, 2020, the Company and Mr. Simony entered into an amendment (the "Amendment") to the Simony Retention Agreement. Pursuant to the Amendment, the remaining one-third of the retention payment is accelerated and will be paid within seven (7) days of the date of the Amendment. The Company does not have any general policies regarding the use of employment agreements, but has and may, from time to time, enter into such a written agreement to reflect the terms and conditions of employment of a particular named executive officer, whether at the time of hire or thereafter. Subsequent Events Departure - Chief Legal Officer and General Counsel On September 30, 2020, the Company and Harvey Werblowsky, the Company’s Chief Legal Officer and General Counsel, agreed to eliminate Mr. Werblowsky’s position. Mr. Werblowsky’s employment with the Company is terminated effective October 9, 2020. Voluntary Petitions for Reorganization On October 15, 2020 (the "2020 Petition Date"), Emergent Capital and its wholly-owned subsidiary Red Reef Alternative Investment, LLC ("Red Reef") filed voluntary petitions for relief (the "2020 Chapter 11 Cases") under chapter 11 of title 11 of the United States Code (the "Bankruptcy Code") in the United States Bankruptcy Court for the District of Delaware (the "Bankruptcy Court"). Emergent Capital and Red Reef will continue to operate their business as "debtors-in-possession" under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and the orders of the Bankruptcy Court. On October 14, 2020, Emergent Capital entered into two substantially identical Restructuring Support Agreements (together with all exhibits and schedules thereto, the "RSAs") with certain holders of the 8.5% Senior Secured Notes and with certain holders of the 5.0% Convertible Notes (such holders collectively, the "Supporting Holders"). In the aggregate, the Supporting Holders hold at least a majority of each of the 8.5% Senior Secured Notes and the 5.0% Convertible Notes. See Note 21 , "Subsequent Events, " to the accompanying consolidated financial statements for further information. Litigation In accordance with applicable accounting guidance, the Company establishes an accrued liability for litigation and regulatory matters when those matters present loss contingencies that are both probable and estimable. In such cases, there may be an exposure to loss in excess of any amounts accrued. When a loss contingency is not both probable and estimable, the Company does not establish an accrued liability. As a litigation or regulatory matter develops, the Company, in conjunction with any outside counsel handling the matter, evaluates on an ongoing basis whether such matter presents a loss contingency that is probable and estimable. If, at the time of evaluation, the loss contingency related to a litigation or regulatory matter is not both probable and estimable, the matter will continue to be monitored for further developments that would make such loss contingency both probable and estimable. When a loss contingency related to a litigation or regulatory matter is deemed to be both probable and estimable, the Company will establish an accrued liability with respect to such loss contingency and record a corresponding amount of litigation-related expense. The Company will then continue to monitor the matter for further developments that could affect the amount of any such accrued liability. Lincoln Benefit Settlement On May 22, 2019, a settlement in the amount of $21.3 million was signed between Lincoln Benefit Life Company, White Eagle Asset Portfolio, L.P. and Emergent Capital, Inc. pursuant to which Lincoln Benefit, agreed to not to contest the 55 life insurance policies that are presently owned by White Eagle and Emergent Capital agreed to drop its legal action against Allstate Life Insurance Company and settle for $2.0 million. The settlement relates to six separate legal actions pertaining to the validity of certain White Eagle policies and receivables for maturities of life settlements totaling $39.1 million. The settlement of the litigation was approved by the Bankruptcy Court in June 2019, and accordingly, the receivable for maturities of life settlement was adjusted to reflect the reduction which resulted in approximately $17.8 million recorded as change in fair value of life settlements loss in the condensed and consolidated financial statements of the Debtors at May 31, 2019. The $2.0 million settlement related to the Allstate lawsuit was recorded as other income in the consolidated statements of operations upon receipt. Sun Life Settlement On April 18, 2013, Sun Life Assurance Company of Canada ("Sun Life") filed a complaint against the Company and several of its affiliates in the United States District Court for the Southern District of Florida, entitled Sun Life Assurance Company of Canada v. Imperial Holdings, Inc., et al . (" Sun Life Case "), asserting, among other things, that at least 28 life insurance policies issued by Sun Life and owned by the Company through certain of its subsidiary companies were invalid. The Sun Life complaint, as amended, asserted the following claims: (1) violations of the federal Racketeer Influenced and Corrupt Organizations ("RICO") Act, (2) conspiracy to violate the RICO Act, (3) common law fraud, (4) aiding and abetting fraud, (5) civil conspiracy to commit fraud, (6) tortious interference with contractual obligations, and (7) a declaration that the policies issued were void. Following the filing of a motion by the Company to dismiss the Sun Life Case, on December 9, 2014, counts (2), (4), (5), (6) and (7) of the Sun Life Case were dismissed with prejudice. The Company then filed a motion for summary judgment on the remaining counts. On February 4, 2015, the Court issued an order (the "Order") granting the Company’s motion for summary judgment on counts (1) and (3), resulting in the Company prevailing on all counts in the Sun Life Case. On July 29, 2013, the Company filed a separate complaint against Sun Life in the United States District Court for the Southern District of Florida, captioned Imperial Premium Finance, LLC v. Sun Life Assurance Company of Canada ("Imperial Case"), which was subsequently consolidated with the Sun Life Case. The Imperial Case asserted claims against Sun Life for breach of contract, breach of the covenant of good faith and fair dealing, and fraud, and sought a judgment declaring that Sun Life is obligated to comply with the promises made by it in certain insurance policies. The Imperial complaint also sought compensatory damages amounting to at least $30.0 million and an award of punitive damages. On August 23, 2013, Sun Life moved to dismiss the complaint, but the Court denied Sun Life’s motion in early 2015. Subsequently, on February 26, 2015, Sun Life appealed the denial to the United States Court of Appeals for the Eleventh Circuit. The Company moved to dismiss Sun Life’s appeal, and, on December 17, 2015, the Court of Appeals ruled in favor of the Company, dismissing Sun Life’s appeal. The Imperial Case therefore returned to the District Court. On September 22, 2016, however, the District Court granted summary judgment in favor of Sun Life on the entirety of the Imperial Case. Subsequently, on January 12, 2017, the Company appealed the District Court’s decision, and on January 24, 2017, Sun Life filed its own notice of appeal. As part of these two appeals, the Court of Appeals will review every dispositive order issued by the District Court throughout the consolidated case. Per the Court of Appeals, oral argument will be scheduled in the near future. In January 2018, oral argument was held in the Eleventh Circuit Court of Appeals. In September 2018, the Circuit Court ruled that Florida is the jurisdiction for all the Sun Life cases. On December 4, 2019 the Company and certain of its subsidiaries entered into a Settlement Agreement and Mutual Release (the "Settlement Agreement") with Sun Life and Wilmington Trust, N.A. as securities intermediary ("Wilmington Trust"). The Settlement Agreement relates to both the Sun Life 2013.Case and the Imperial Case (the "Legal Action"). Pursuant to the Settlement Agreement, (i) 31 life insurance policies with face totaling $163.5 million issued by Sun Life were canceled in exchange for a lump sum payment of $36.1 million. The settlement included two policies held by the Company outside of White Eagle with an aggregate face value of $12.0 million, 28 policies held by White Eagle with an aggregate face value of $141.5 million and one policy with a face value of $10.0 million in receivable for maturity for White Eagle. Of this amount, approximately $12.7 million was received by the Company, $13.4 million was paid to White Eagle and $10.0 million was paid to Wilmington Trust for the maturity receivable, (ii) the Legal Action dismissed with prejudice, (iii) Sun Life agreed not to challenge the validity of or to seek to deny coverage (other than for non-payment of premiums) for certain life insurance policies issued by it and held by White Eagle that were specifically excluded from the settlement or have already matured, and (iv) Sun Life released all claims against the Company and Wilmington Trust, and the Company and Wilmington Trust released all claims against Sun Life. Other Litigation Other litigation is defined as smaller claims or litigations that are neither individually nor collectively material. It does not include lawsuits that relate to collections. The Company is party to various other legal proceedings that arise in the ordinary course of business, separate from normal course accounts receivable collections matters. Due to the inherent difficulty of predicting the outcome of these litigations and other legal proceedings, the Company cannot predict the eventual outcome of these matters, and it is reasonably possible that some of them could be resolved unfavorably to the Company. As a result, it is possible that the Company’s results of operations or cash flows in a particular fiscal period could be materially affected by an unfavorable resolution of pending litigation or contingencies. However, the Company believes that the resolution of these other proceedings will not, based on information currently available, have a material adverse effect on the Company’s financial position or results of operations. |
Stockholders' Deficit_Equity
Stockholders' Deficit/Equity | 9 Months Ended |
Aug. 31, 2020 | |
Equity [Abstract] | |
Stockholders' Deficit/Equity | Stockholders’ Deficit/Equity Shares of Common Stock under Omnibus Plan The Company has reserved an aggregate of 12,600,000 shares of common stock under its Omnibus Plan, pursuant to which, as of August 31, 2020, 100,000 shares of stock appreciation rights had been granted to a director and were fully vested and outstanding, 633,215 shares of restricted stock had been granted to directors and were fully vested, 3,270,000 shares of restricted stock units had been granted to certain employees, with a total of 1,000,000 shares subject to vesting. Approximately 2,270,000 shares have been vested since granted. There were 8,511,785 securities remaining for future issuance under the Omnibus Plan as of August 31, 2020. Share Note Repurchase Program On September 1, 2015, the Company announced that its Board of Directors authorized a $10.0 million share and note repurchase program. The program had a two-year expiration date and authorized the Company to repurchase up to $10.0 million of its common stock and/or its Convertible Notes due 2019. During 2015, the Company purchased 608,000 shares for a total cost of approximately $2.5 million, which is an average cost of $4.17 per share, including transaction fees, the amount is included in stockholder's equity on the consolidated balance sheet at August 31, 2020. The repurchase program was terminated during the year ended December 31, 2017. Warrants On July 28, 2017, in connection with the recapitalization transaction, the Company issued common stock purchase warrants to certain investors to purchase up to an aggregate of 42,500,000 shares of the Company’s common stock at an exercise price of $0.20 per share (the "Warrant Shares"). The warrants shall vest and become exercisable as follows: (i) with respect to 17,500,000 Warrant Shares, immediately upon the issuance of the warrants, and (ii) with respect to the remaining 25,000,000 Warrant Shares, at later times tied to the conversion of the Company’s Convertible Notes and New Convertible Notes (each as defined below) outstanding on July 28, 2017 into shares of the Company’s common stock or, if earlier, upon the date that all Convertible Notes or New Convertible Notes are no longer outstanding. The warrants have an eight year term. The number of Warrant Shares is subject to anti-dilution adjustment provisions. Recapitalization Transactions On July 28, 2017, the Company consummated a series of integrated transactions to effect a recapitalization of the Company (the "Transaction Closing") pursuant to the Master Transaction Agreements. Common Stock Purchase Agreement In connection with the Transaction Closing, the Company entered into a Common Stock Purchase Agreement (the "Stock Purchase Agreement") by and among the Company, PJC, certain investors jointly designated by PJC and Triax Capital Advisors LLC, a New York limited liability company ("Triax"), to be party to the Stock Purchase Agreement (collectively, the "Common Stock Investors"), and certain Convertible Note Holders that were a party to the Stock Purchase Agreement (collectively, the "Convertible Note Holder Purchasers," and together with PJC and the Common Stock Investors, the "Purchasers"). Pursuant to the Stock Purchase Agreement, the Company issued and sold to the Purchasers 115,000,000 shares (the "Stock Purchase Agreement Shares") of the Company’s common stock, $0.01 par value at a price of $0.20 per share for an aggregate purchase price of $23.0 million, of which PJC and the Common Stock Investors purchased 75,000,000 Stock Purchase Agreement Shares for an aggregate purchase price of $15.0 million and the Convertible Note Holder Purchasers, pursuant to the previously announced rights offering which expired on July 26, 2017, purchased 40,000,000 Stock Purchase Agreement Shares for an aggregate purchase price of $8.0 million, of which PJC purchased 19,320,038 shares in connection with the exercise of rights assigned to it by certain Convertible Note Holder Purchasers. The Stock Purchase Agreement contained customary representations, warranties, and covenants. In August 2017, the Company entered into a Securities Purchase Agreement (the "Securities Purchase Agreement") by and between the Company and Brennan Opportunities Fund I LP ("Brennan"). Pursuant to the Securities Purchase Agreement, Brennan purchased from the Company 12,500,000 shares (the "Brennan Shares") of Common Stock at a price of $0.40 per share for an aggregate purchase price of $5.0 million. Articles Amendment Effective on July 17, 2017, the Company filed an Articles of Amendment to Articles of Incorporation (the "Articles Amendment") to increase the authorized Common Stock from 80,000,000 shares to 415,000,000 shares. As previously disclosed, the Articles Amendment was approved by the Company’s shareholders at the Company’s 2017 Annual Meeting. The adoption of the Articles Amendment results in a greater number of shares of Common Stock available for issuance. Change in Significant Holders As a result of the consummation of the Master Transaction Agreements, on the date of the Transaction Closing, a change in significant holders of the Company's common stock occurred. PJC and Triax, together with certain of their affiliates, acquired beneficial ownership of approximately 38.9% of the outstanding Common Stock, based on their aggregate acquisition of 39,320,038 shares of Common Stock and warrants to purchase 27,150,000 shares of Common Stock. Other investors designated by PJC and Triax acquired beneficial ownership of approximately 43.6% of the outstanding Common Stock, based on their aggregate acquisition of 55,000,000 shares of Common Stock and warrants to purchase 13,350,000 shares of Common Stock. Additionally, pursuant to the Board Designation Agreements, PJC and Triax designated two of seven directors to the Company’s Board, two other investors designated a third new director and a fourth new director, and a fifth new director was designated by a holder of New Convertible Notes, collectively resulting in a change in the majority of the Company’s Board. |
Income Taxes
Income Taxes | 9 Months Ended |
Aug. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company’s provision for income taxes from continuing operations is estimated to result in an effective tax rate of 13.12% as of August 31, 2020 and a total tax expense of approximately $2.4 million for the nine months ended August 31, 2020. The Company’s effective tax rate is principally impacted by expected income inclusions under the GILTI tax regime, limitations imposed on the use of historical net operating losses, and interest expense limitations under IRC Sec. 264(a)(4) that apply when determining tested income for the GILTI inclusion. The GILTI inclusion is driven in large part by the Company’s allocable share of taxable income from the WE Investment. The Company coordinates with the manager of the WE Investment to obtain reasonable estimates of the Company’s share of taxable results. As the estimated allocable share of taxable income from the WE investment represents a significant portion of the Company’s expected taxable income, in accordance with ASC 740 principles, the Company’s tax provision recorded to date is based on actual results through August 31, 2020. The Company believes this approach most fairly represents its income tax provision as of August 31, 2020. Based on the Company’s evaluation, a deferred tax valuation allowance was established against its net deferred tax assets. In its evaluation, management considers taxable loss carryback availability, expectations of sufficient future taxable income, trends in earnings, existence of taxable income in recent years, the future reversal of temporary differences, and available tax planning strategies that could be implemented, if required. Valuation allowances are established based on the consideration of all available evidence using a more likely than not standard. This valuation allowance was determined to be necessary as an offset to the full amount of the federal and state deferred tax asset. During the three months ended August 31, 2020, the Company does not expect that position to change and therefore is not recording any income tax benefit. Impact of Tax Reform Beginning with the tax year ended November 30, 2019, the Company became subject to the Global Intangible Lowed-Taxed Income regime (referred to as "GILTI"), which is a tax on certain foreign income earned in excess of a deemed return on tangible assets held by a controlled foreign corporation. The GILTI is included in U.S. taxable income on a current basis by its U.S. shareholders and can generally be offset by a deduction of up to 50% of the income inclusion (through the end of 2025, thereafter the deduction is reduced to 37.5%) subject to certain limitations. Based on the Company’s partnership interest in White Eagle that is held through Lamington (which represents its principal business asset), its allocable share of taxable income is subject to the GILTI regime. For ASC 740 purposes, the Company adopted an accounting policy to treat any future GILTI inclusion as a current-period expense instead of providing for U.S. deferred taxes on all temporary differences related to future GILTI items. Palomino Transaction On August 16, 2019, the WE Investment was consummated whereby White Eagle, an indirectly-owned entity of the Company, sold to Palomino a 72.5% limited partnership interest in White Eagle, consisting of newly issued and outstanding Class A and Class D interests. Pursuant to the agreement, Lamington retained 27.5% of the limited partnership interests of White Eagle, consisting of all of the newly issued and outstanding Class B interests. For U.S. income tax purposes, this transaction was treated as a contribution by White Eagle of its assets and liabilities to a newly-formed partnership in exchange for the 27.5% interest in White Eagle’s capital and profits. The Company recognized no gain or loss as a result of the transaction. The Company and its subsidiary companies are subject to U.S. federal income tax, as well as to income tax in Florida and other states and foreign jurisdictions in which it operates. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Aug. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Sale of Imperial Life Settlements, LLC On September 15, 2020, the Company sold its wholly-owned subsidiary, Imperial Life Settlements, LLC ("ILS"), to an unrelated third party. Included in the sale were viatical and/or life settlement provider licenses, permits and authorizations issued to ILS by 12 states. In connection with the sale of ILS and such licenses, the Company voluntarily surrendered licenses issued to ILS by 17 other states. Such licenses are required in connection with the purchase of existing life settlements, but are not required for ownership of life settlements. The Company, which indirectly owns a 27.5% equity investment in White Eagle Asset Portfolio, LP, which holds a portfolio of life settlements, no longer acquires life settlements, and therefore does not need to maintain the licenses and their related deposits and expenses. Departure - Chief Legal Officer and General Counsel On September 30, 2020, the Company and Harvey Werblowsky, the Company’s Chief Legal Officer and General Counsel, agreed to eliminate Mr. Werblowsky’s position. Mr. Werblowsky’s employment with the Company is terminated effective October 9, 2020. Voluntary Petitions for Reorganization On October 15, 2020 (the "2020 Petition Date"), Emergent Capital and its wholly-owned subsidiary Red Reef Alternative Investment, LLC ("Red Reef") filed voluntary petitions for relief (the "2020 Chapter 11 Cases") under chapter 11 of title 11 of the United States Code (the "Bankruptcy Code") in the United States Bankruptcy Court for the District of Delaware (the "Bankruptcy Court"). Emergent Capital and Red Reef will continue to operate their business as "debtors-in-possession" under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and the orders of the Bankruptcy Court. On October 14, 2020, Emergent Capital entered into two substantially identical Restructuring Support Agreements (together with all exhibits and schedules thereto, the "RSAs") with certain holders of the 8.5% Senior Secured Notes and with certain holders of the 5.0% Convertible Notes (such holders collectively, the "Supporting Holders"). In the aggregate, the Supporting Holders hold at least a majority of each of the 8.5% Senior Secured Notes and the 5.0% Convertible Notes. The RSAs contemplate a restructuring process that will result in the Company moving its headquarters and operations to Lamington, its indirect wholly-owned Irish subsidiary. The contemplated restructuring process will provide that holders of 8.5% Senior Secured Notes, 5.0% Convertible Notes, and Emergent Capital’s common stock and common stock equivalents will receive securities of Lamington and of a Cayman grantor trust to be formed that are substantially similar in substance to, and in exchange for, their current Emergent Capital securities and that such new Lamington securities and Cayman trust certificates will be listed for trading on a European stock exchange (as agreed among the parties), all in accordance with the terms set forth in the term sheet attached to and made part of the RSAs, and existing Emergent Capital securities will be cancelled and the common stock will cease to trade on the OTCQX market (the transactions contemplated in the RSAs, the "Restructuring"). Subsequent to the Restructuring, Emergent Capital will wind up its remaining affairs. More details about the Restructuring are provided to security holders in the Disclosure Statement filed with the Bankruptcy Court. The RSAs contain various milestones with respect to the 2020 Chapter 11 Cases. Each RSA also provides that it may be terminated by the Supporting Holders party thereto or Emergent Capital upon the occurrence of certain events and upon the terms set forth therein. Although the Company intends to pursue the Restructuring, there can be no assurance that the Company will be successful in completing the Restructuring or any other similar transaction on the terms set forth in the RSAs or at all. |
Principles of Consolidation a_2
Principles of Consolidation and Basis of Presentation (Policies) | 9 Months Ended |
Aug. 31, 2020 | |
Accounting Policies [Abstract] | |
Consolidation and Related Party Relationship | The accompanying consolidated financial statements include the accounts of the Company, all of its wholly-owned subsidiary companies and its special purpose entities, with the exception of the Deconsolidated Entities (as defined below), White Eagle , an unconsolidated equity investment effective August 17, 2019, which is accounted for using fair value and Imperial Settlements Financing 2010, LLC ("ISF 2010"), an unconsolidated special purpose entity which is accounted for using the measurement alternative, which is measured at cost less impairment. The special purpose entity was to fulfill specific objectives. All significant intercompany balances and transactions, except those related to Lamington after November 13, 2018 to August 16, 2019 (see Note 4) have been eliminated in consolidation, including income from services performed by subsidiary companies in connection with the White Eagle Revolving Credit Facility, as detailed herein. Related Party Relationship Upon filing for Chapter 11 and the subsequent deconsolidation, transactions with Lamington were no longer eliminated in consolidation and are treated as related party transactions for Emergent Capital. On August 17, 2019 Lamington was reconsolidated and its transactions are eliminated in consolidation. See Note 5 "Condensed and Consolidated Financial |
Basis of Presentation | The unaudited consolidated financial statements have been prepared in conformity with the rules and regulations of the SEC for Form 10-Q and therefore do not include certain information, accounting policies, and footnote disclosure information or footnotes necessary for a complete presentation of financial position, results of operations and cash flows in conformity with generally accepted accounting principles. However, all adjustments (consisting of normal recurring accruals), which, in the opinion of management, are necessary for a fair presentation of the financial statements, have been included. Operating results for the three months ended August 31, 2020 and nine months ended August 31, 2020 are not necessarily indicative of the results that may be expected for future periods or for the year ending November 30, 2020. These interim financial statements should be read in conjunction with the Consolidated Financial Statements and Notes thereto included in Emergent Capital's Report on Form 10-K for the fiscal year ended November 30, 2019. |
Discontinued Operations | Discontinued Operations On October 25, 2013, the Company sold substantially all of the assets comprising its structured settlement business. As a result, the Company has discontinued segment reporting and classified its operating results of the structured settlement business, net of income taxes, as discontinued operations. The accompanying consolidated statements of operations for the three months and nine months ended August 31, 2020 and August 31, 2019, and the related notes to the consolidated financial statements, reflect the classification of its structured settlement business operating results, net of tax, as discontinued operations. See Note 9, "Discontinued Operations," of the accompanying consolidated financial statements for further information. Unless otherwise noted, the following notes refer to the Company’s continuing operations. |
Foreign Currency | Foreign Currency The Company owns certain foreign subsidiary companies formed under the laws of Ireland, the Bahamas and Bermuda. These foreign subsidiary companies utilize the U.S. dollar as their functional currency. The foreign subsidiary companies' financial statements are denominated in U.S. dollars and therefore, there are no translation gains and losses resulting from translating the financial statements at exchange rates other than the functional currency. Any gains and losses resulting from foreign currency transactions (transactions denominated in a currency other than the subsidiary companies' functional currency) are included in income. These gains and losses are immaterial to the Company’s financial statements. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements, in conformity with accounting principles generally accepted in the United States of America ("GAAP"), requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from these estimates and such differences could be material. Significant estimates made by management include income taxes, the valuation of life settlements, the valuation of equity awards and the valuation of our investment in limited partnership. |
Reclassifications | Reclassifications Certain reclassifications of the prior period amounts and presentation have been made to conform to the presentation for the current period. These reclassifications relate primarily to change in fair value of investment in deconsolidated subsidiaries and sublease income. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In August 2018, the FASB issued ASU 2018-13, "Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement" which modifies the disclosure requirements on fair value measurements in Topic 820, Fair Value Measurement, based on the concepts in the Concepts Statement, including the consideration of costs and benefits. The following disclosure requirements were removed from Topic 820 among others: 1) The amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy 2) The policy for timing of transfers between levels. The following disclosure requirements were part of the modifications in Topic 820:1) For investments in certain entities that calculate net asset value, an entity is required to disclose the timing of liquidation of an investee’s assets and the date when restrictions from redemption might lapse only if the investee has communicated the timing to the entity or announced the timing publicly. The amendments also clarify that the measurement uncertainty disclosure is to communicate information about the uncertainty in measurement as of the reporting date. Lastly, the following disclosure requirements were added to Topic 820:1) the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period; 2) the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. For certain unobservable inputs, an entity may disclose other quantitative information (such as the median or arithmetic average) in lieu of the weighted average if the entity determines that other quantitative information would be a more reasonable and rational method to reflect the distribution of unobservable inputs used to develop Level 3 fair value measurements. The amendments in this Update are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. We are currently evaluating the methods and impact of adopting this new standard on our consolidated financial statements. In October 2018, the FASB issued ASU No. 2018-17, Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities ("ASU 2018-17"). ASU 2018-17 provides that indirect interests held through related parties in common control arrangements should be considered on a proportional basis for determining whether fees paid to decision makers and service providers are variable interests. ASU 2018-17 is effective for public companies for annual and interim periods beginning after December 15, 2019, with early adoption permitted. We are currently evaluating the methods and impact of adopting this new standard on our consolidated financial statements. In May 2019, the FASB issued ASU No. 2019- 05 which amends ASU 2016-13 to allow companies to irrevocably elect, upon adoption of ASU 2016-13, the fair value option on financial instruments that (1) were previously recorded at amortized cost and (2) are within the scope of ASC 326-203 if the instruments are eligible for the fair value option under ASC 825-10.4 The fair value option election does not apply to held-to-maturity debt securities. Entities are required to make this election on an instrument-by-instrument basis. ASU 2019-05’s amendments should be applied "on a modified-retrospective basis by means of a cumulative-effect adjustment to the opening balance of retained earnings balance in the statement of financial position as of the date that an entity adopted the amendments in ASU 2016-13." Certain disclosures are required. For entities that have adopted ASU 2016-13, the amendments in ASU 2019-05 are effective for fiscal years beginning after December 15, 2019, including interim periods therein. An entity may early adopt the ASU in any interim period after its issuance if the entity has adopted ASU 2016-13. For all other entities, the effective date will be the same as the effective date in ASU 2016-13.We are currently evaluating the methods and impact of adopting this new standard on our consolidated financial statements. In May 2019, the FASB issued ASU No 2019-04 which clarifies certain aspects of accounting for credit losses, hedging activities, and financial instruments. The ASU’s amendments apply to all entities within the scope of the affected guidance. Accrued interest - Amortized cost basis is defined in ASU 2016-13 as "the amount at which a financing receivable or investment is originated or acquired, adjusted for applicable accrued interest, accretion or amortization of premium, discount, and net deferred fees or costs, collection of cash, write offs, foreign exchange, and fair value hedge accounting adjustments". To address stakeholders’ concerns that the inclusion of accrued interest in the definition of amortized cost basis could make application of the credit loss guidance operationally burdensome, ASU 2019-04 provides certain alternatives for the measurement of the allowance for credit losses (ALL) on accrued interest receivable (AIR). These measurement alternatives include (1) measuring an ALL on AIR separately, (2) electing to provide separate disclosure of the AIR component of amortized cost as a practical expedient, and (3) making accounting policy elections to simplify certain aspects of the presentation and measurement of such AIR. For entities that have adopted ASU 2016-13, the amendments in ASU 2019-04 related to ASU 2016-13 are effective for fiscal years beginning after December 15, 2019, and interim periods therein. ASU 2019-04’s amendments should be applied "on a modified-retrospective basis by means of a cumulative-effect adjustment to the opening retained earnings balance in the statement of financial position as of the date an entity adopted the amendments in ASU 2016-13." Certain disclosures are also required. For all other entities, the effective date will be the same as the effective date in ASU 2016-13. We are currently evaluating the methods and impact of adopting this new standard on our consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740) - Simplifying the Accounting for Income Taxes. The ASU enhances and simplifies various aspects of the income tax accounting guidance in ASC 740, including requirements related to the following: (1) hybrid tax regimes; (2) tax basis step-up in goodwill obtained in a transaction that is not a business combination; (3) separate financial statements of entities not subject to tax; (4) intra-period tax allocation exception to the incremental approach; (5) ownership changes in investments; (6) interim-period accounting for enacted changes in tax law; (7) year-to-date loss limitation in interim-period tax accounting. The amendments in ASU 2019-12 are effective for public business entities for fiscal years beginning after December 15, 2020, including interim periods therein. Early adoption of the standard is permitted, including adoption in interim or annual periods for which financial statements have not yet been issued. We are currently evaluating the methods and impact of adopting this new standard on our consolidated financial statements. In January 2020, the FASB issued ASU 2020-01, Clarifying the Interactions between Topic 321, Topic 323, and Topic 815. The amendments in this Update clarify certain interactions between the guidance to account for certain equity securities under Topic 321, the guidance to account for investments under the equity method of accounting in Topic 323, and the guidance in Topic 815, which could change how an entity accounts for an equity security under the measurement alternative or a forward contract or purchased option to purchase securities that, upon settlement of the forward contract or exercise of the purchased option, would be accounted for under the equity method of accounting or the fair value option in accordance with Topic 825, Financial Instruments. These amendments improve current GAAP by reducing diversity in practice and increasing comparability of the accounting for these interactions. For public business entities, the amendments in this Update are effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. Early adoption is permitted, including early adoption in an interim period, (1) for public business entities for periods for which financial statements have not yet been issued and (2) for all other entities for periods for which financial statements have not yet been made available for issuance. The amendments in this Update should be applied prospectively. Under a prospective transition, an entity should apply the amendments at the beginning of the interim period that includes the adoption date. We are currently evaluating the methods and impact of adopting this new standard on our consolidated financial statements. In June 2020, the FASB issued ASU 2020-06 which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity. ASU 2020-06 also amends certain guidance in ASC 260 on the computation of EPS for convertible instruments and contracts on an entity’s own equity. Under ASU 2020-06, entities must apply the if-converted method to all convertible instruments because the treasury stock method will no longer be available. In instances where the principal amount must be paid in cash and only the conversion spread is settled in shares, the if-converted method is modified so that interest expense is not added back to the numerator, and the denominator only includes the net number of incremental shares that would be issued upon conversion. ASU 2020-06 clarifies that the "average market price should be used to calculate the diluted EPS denominator" when the exercise price or the number of shares that may be issued is variable, except for certain contingently issuable shares. For public business entities that are not smaller reporting companies, the amendments in this update are effective for fiscal years beginning after December 15, 2021, and interim periods within those fiscal years. For all other entities, the guidance will be effective for the fiscal years beginning after December 15, 2023, and interim periods within those fiscal years. The guidance may be early adopted for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. We are currently evaluating the methods and impact of adopting this new standard on our consolidated financial statements. Adopted Accounting Pronouncements Change in Accounting Principle and Accounting for Lease |
Recent Accounting Pronounceme_2
Recent Accounting Pronouncements (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Accounting Changes and Error Corrections [Abstract] | |
Schedule of Impact of Adoption of ASU 2016-02 Leases (Topic 842) on Consolidated Financial Statements | In transitioning the application of this guidance, retrospective application to all periods presented in the consolidated financial statements has been performed as follows (in thousands): As reported under previous accounting guidance As reported under ASU 2016-02 Effect of change Balance Sheet - November 30, 2019 Assets Prepaid and other assets $ 377 $ 353 $ 24 Operating lease assets — 132 132 Total assets $ 165,712 $ 165,868 $ 156 Liabilities Other liabilities $ 86 $ 39 $ (47) Operating lease liability — 203 203 Total liabilities 123,599 123,755 156 Total stockholders' equity 42,113 42,113 — Total liabilities and stockholders' equity $ 165,712 $ 165,868 $ 156 Net effect $ — $ — $ — |
Deconsolidation of Subsidiari_2
Deconsolidation of Subsidiaries (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Reorganizations [Abstract] | |
Schedule of Fair Value on Investment in Lamington | The fair value of the investment in Lamington at August 16, 2019 was calculated as follows: Investment in Lamington at December 1, 2018 $ 128,795 Less: Change in fair value 37,941 Investment in Lamington at August 16, 2019 $ 166,736 |
Schedule of Company's Investment in Deconsolidated Entities | The table below summarizes the composition of the Company's investment in the deconsolidated entities at August 31, 2019: Change in Fair Value November 30, 2018 December 1, 2018 to August 16, 2019 August 31, 2019 Equity investment $ 66,251 $ (45,847) $ 20,404 Promissory notes 56,596 89,736 146,332 Other liabilities 5,948 (5,948) — Total investment $ 128,795 $ 37,941 $ 166,736 |
Condensed and Consolidated Fi_2
Condensed and Consolidated Financial Statements for Entities in Bankruptcy (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Condensed Financial Information of Debtor-in-Possession Disclosure [Abstract] | |
Schedule of Condensed and Consolidated Financial Information for Lamington Road DAC | Condensed consolidated financial information for Lamington Road DAC is set forth below, presented at historical cost basis. Lamington Road DAC (Debtor-in-Possession) Condensed and Consolidated Statements of Operations Three Months Ended Three Months Ended Nine Months Ended August 31, Nine Months Ended August 31, 2020 2019 2020 2019 Change in fair value of life settlements (Notes 11 & 16) $ — $ 12,985 $ — $ (16,841) Change in fair value of investment in limited partnership (Note 10 &15) — 15,352 — 15,352 Realized Gain on Life Settlements, Net — 21,336 — 21,336 Other income — 345 — 709 Total income — 50,018 — 20,556 Interest expense — 23,331 — 28,331 Change in fair value of White Eagle Revolving Credit Facility (Notes 12 & 16) — (26,586) — 17,094 Loss on extinguishment of debt — 7,360 — 7,360 Reorganization cost — 4,769 — 13,954 Legal fees — 158 — 890 Professional fees — 659 — 1,549 Administrative service fees - affiliate — — — 2,765 Other general and administrative expenses — (71) — 469 Total expenses — 9,620 — 72,412 Income taxes — — — — (Loss) income $ — $ 40,398 $ — $ (51,856) Lamington Road DAC (Debtor-in-Possession) Condensed and Consolidated Statements of Cash Flows Nine Months Ended August 31, Nine Months Ended August 31, 2020 2019 Net cash used in operating activities $ — $ (58,793) Cash flows from investing activities Premiums paid on life settlements — (69,827) Proceeds from maturity of life settlements — 92,505 Net cash provided by/(used in) investing activities $ — $ 22,678 Cash flows from financing activities Repayment of borrowings under White Eagle Revolving Credit Facility — (1,804) Borrowings from White Eagle Revolving Credit Facility — 4,221 Cash distributed to Parent Company — (21) Net cash provided by financing activities $ — $ 2,396 Net increase (decrease) in cash and cash equivalents — (33,719) Cash and cash equivalents, at beginning of the period — 33,719 Cash and cash equivalents, at end of the period $ — $ — Supplemental disclosures of cash flow information: Cash paid for interest during the period $ — $ 28,331 Supplemental disclosures of non-cash financing activities: Repayment of White Eagle Revolving Credit Facility by third party from proceeds of sale of life settlement $ — $ 366,821 White Eagle early extinguishment fees paid by third party from proceeds of Class D Shares $ — $ 7,360 |
Consolidation of Variable Int_2
Consolidation of Variable Interest Entities (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Consolidation of Variable Interest Entities | The following table presents the consolidated assets and consolidated liabilities of VIEs for which the Company has concluded that it is the primary beneficiary and which are consolidated in the Company’s financial statements as of August 31, 2020 and November 30, 2019, as well as non-consolidated VIEs for which the Company has determined it is not the primary beneficiary (in thousands): Not Primary Not Primary Non-consolidated VIE Non-consolidated VIE- White Eagle Total Maximum Total Maximum August 31, 2020 $ — $ — $ 152,450 $ 152,450 November 30, 2019 $ — $ — $ 137,849 $ 137,849 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Reconciliation of Actual Basic and Diluted Earnings Per Share | The following table reconciles actual basic and diluted earnings per share for the three months and nine months ended August 31, 2020 and 2019 (in thousands except per share data). Three Months Ended August 31, Nine Months Ended August 31, 2020(1) 2019(2) 2020(3) 2019(4) Income (loss) per share: Numerator: Net income (loss) from continuing operations $ (1,028) $ 80,201 $ 16,127 $ 16,875 Net income (loss) from discontinued operations — 70 (53) 36 Numerator for basic EPS - net income (loss) attributable to common stockholders $ (1,028) $ 80,271 $ 16,074 $ 16,911 Add back convertible notes interest — 1,095 2,996 3,270 Numerator for diluted earnings per share - net income (loss) attributable to common stockholders $ (1,028) $ 81,296 $ 19,123 $ 20,145 Basic income (loss) per common share: Basic income (loss) from continuing operations $ (0.01) $ 0.51 $ 0.10 $ 0.11 Basic income (loss) from discontinued operations — — — — Basic income (loss) per share available to common shareholders $ (0.01) $ 0.51 $ 0.10 $ 0.11 Diluted income (loss) per common share: Diluted income (loss) from continuing operations $ (0.01) $ 0.41 $ 0.09 $ 0.10 Diluted income (loss) from discontinued operations — — — — Diluted income (loss) per share available to common shareholders $ (0.01) $ 0.41 $ 0.09 $ 0.10 Denominator: Basic 157,655,140 156,968,470 157,624,241 156,949,425 Diluted 157,655,140 195,979,957 206,696,703 194,867,908 (1) The computation of diluted EPS does not include 100,000 shares underlying stock appreciation rights, 1,000,000 shares of restricted stock, 42,500,000 shares of common stock underlying warrants and 33,918,483 shares of common stock issuable upon conversion of the 5% Convertible Notes as the effect of their inclusion would have been anti-dilutive. (2) The computation of diluted EPS does not include 85,000 shares of common stock underlying options, 100,000 shares of stock appreciation rights and 2,000,000 shares of common stock underlying warrants, as the effect of their inclusion would have been anti-dilutive. (3) The computation of diluted EPS does not include 100,000 shares underlying stock appreciation rights as the effect of their inclusion would have been anti-dilutive. (4) The computation of diluted EPS does not include 85,000 shares of common stock underlying options, 100,000 shares of stock appreciation rights, 1,083,333 shares of restricted stock and 44,500,000 shares of common stock underlying warrants, as the effect of their inclusion would have been anti-dilutive. |
Stock-based Compensation (Table
Stock-based Compensation (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Common Stock Option Activity | The following table presents the activity of the Company’s stock options for the nine months ended August 31, 2020: Common Stock Options Number of Weighted Weighted Aggregate Outstanding Balance, December 1, 2019 85,000 $ 6.94 0.56 $ — Options granted — — — Options exercised — — — Options forfeited — $ — — Options expired (85,000) 6.94 — Options outstanding, August 31, 2020 — $ — — $ — Exercisable at August 31, 2020 — $ — — Unvested at August 31, 2020 — — — $ — |
Schedule of Activity of Unvested Shares of Restricted Stock | The following table presents the activity of the Company’s unvested shares of restricted stock for the three months ended August 31, 2020: Common Unvested Shares Number of Outstanding Balance, December 1, 2019 333,333 Granted 1,000,000 Vested (333,333) Forfeited — Outstanding August 31, 2020 1,000,000 |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Operating Results of Discontinued Structured Settlement Business | Operating results related to the Company’s discontinued structured settlement business are as follows: Three Months Ended Nine Months Ended 2020 2019 2020 2019 (in thousands) Total income $ — $ — $ — $ — Total expenses — (70) 53 (36) Income (loss) before income taxes — 70 (53) 36 (Benefit) provision for income taxes — — — — Net income (loss) from discontinued operations, net of income taxes $ — $ 70 $ (53) $ 36 |
Life Settlements (Life Insura_2
Life Settlements (Life Insurance Policies) (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Investments, All Other Investments [Abstract] | |
Schedule of Life Settlements | The weighted average life expectancy calculated based on death benefit of insureds in the policies owned by the Company at November 30, 2019 was 11.4 years. Remaining Life Expectancy (In Years)* Number of Life Settlement Contracts Fair Value Face Value 0-1 — $ — $ — 1-2 — — — 2-3 — — — 3-4 — — — 4-5 — — — Thereafter 2 1,297 12,000 Total 2 $ 1,297 $ 12,000 At August 31, 2020, there were 500 policies in the White Eagle portfolio with death benefits of approximately $2.4 billion and the weighted average remaining life expectancy calculated based on death benefit of the insureds in the policies was 6.6 years. Remaining Life Expectancy (In Years)* Number of Life Settlement Contracts Face Value 0-1 9 $ 40,780 1-2 30 114,006 2-3 30 121,696 3-4 54 281,198 4-5 54 253,239 Thereafter 323 1,556,622 Total 500 $ 2,367,541 |
Investment in Limited Partner_2
Investment in Limited Partnership (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Investments in and Advances to Affiliates [Abstract] | |
Schedule of Funds in the Premium/Expense Reserve Account | Funds in the premium/expense reserve account shall be used or otherwise distributed in the following order of priority (in thousands): Premium/Expense Reserve Account Three Months Ended August 31, 2020 Nine Months Ended August 31, 2020 Amount Amount Use of Proceeds First $ 28,289 $ 79,241 Premiums, Expenses and Manager Fees Second 2,000 6,000 Minimum Class B Interest Monthly Distribution - after three years, Class D Returns takes priority until paid in full Third — — Minimum Class B Interest Monthly Distribution Fourth — — Retained for Premium/Expense to Cover Three Months of Transactions, excess to be sent to the Collection Account $ 30,289 $ 85,241 Premium/Expense Reserve Account Three Months Ended August 31, 2019 Nine Months Ended August 31, 2019 Amount Amount Use of Proceeds First $ 8,210 $ 8,210 Premiums, Expenses and Manager Fees Second — — Minimum Class B Interest Monthly Distribution - after three years, Class D Returns takes priority until paid in full Third — — Minimum Class B Interest Monthly Distribution Fourth — — Retained for Premium/Expense to Cover Three Months of Transactions, excess to be sent to the Collection Account $ 8,210 $ 8,210 |
Schedule of Reconciliation of Premium/Expense Reserve Account | The below is a reconciliation of the premium/expense reserve account for the three months and nine months ended August 31, 2020 (in thousands). Three Months Ended August 31, 2020 Nine Months Ended August 31, 2020 Beginning balance $ 22,224 $ 4,195 Distributions received Collections account 34,188 107,169 Total distribution received $ 56,412 $ 111,364 Less Payments: Premiums and expenses 28,289 79,241 Class B monthly distribution 2,000 6,000 Total payments $ 30,289 $ 85,241 Balance at August 31, 2020 $ 26,123 $ 26,123 |
Schedule of Funds on Deposit in the Collections Account and Distributions by the Paying Agent | On each Distribution Date, funds on deposit in the Collections Account shall be distributed by the Paying Agent ("Wilmington Trust, N.A") pursuant to the Waterfall Notice in the following order of priority: Collection Account Three Months Ended August 31, 2020 Nine Months Ended August 31, 2020 Priority Amount Use of Proceeds First $ 34,188 $ 107,169 Premium/Expense Reserve Account - to cover next three months of premiums and expense Second — 9,969 Class A Minimum Return Cumulative Amount* Third — — Minimum Class B Interest Monthly Distribution Fourth — — Re-balancing the Total Return Distributions with 72.5% to the Class A Limited Partner and 27.5% to Class B Limited Partner Fifth — — 72.5% to the Class A Limited Partner and 27.5% to the Class B Limited Partner $ 34,188 $ 117,138 * Second - To pay the Class A Limited Partner the amount necessary such that the Class A Limited Partner shall have received the Class A Minimum Return Cumulative Amount (applied first which is 11%), second to the amounts necessary to reduce the principal balance from $406.0 million on the Effective Date to April 2039 when it is expected to be paid in full (the A&R LPA stipulate the expected monthly reduction in target principal commencing in April 2021), third to later contributions by the Class A Limited Partner, excluding Advance Facility but includes funded into premium/expense account on its own behalf and fourth the Class D Return, in each case of the definition of Class A Minimum Return Cumulative Amount as of the last day of the month immediately prior to such Distribution Date. |
Schedule of Funds Received And Distributions From Collection Account | The below is a reconciliation of funds received in and distributed from the collection account for the three months ended August 31, 2020 and nine months ended August 31, 2020 (in thousands). Three Months Ended August 31, 2020 Nine Months Ended August 31, 2020 Beginning balance $ 5,643 $ 13,007 Maturity proceeds received - face 32,050 107,276 Proceeds received - other* 272 632 Total receipts 37,965 120,915 Less distribution Premium/expense account 34,188 107,169 Class A — 9,969 Total distributions 34,188 117,138 Balance at August 31, 2020 $ 3,777 $ 3,777 *Includes refund of premiums and interest earned on maturity proceeds |
Schedule Reconciliation For Receivable For Maturity of Life Settlement | The below is a reconciliation of receivable for maturity of life settlement held by the limited partnership for the three months and nine months ended August 31, 2020 (in thousands). Three Months Ended August 31, 2020 Nine Months Ended August 31, 2020 Balance at start $ 28,550 $ 13,726 Maturities 43,225 133,275 Less: proceeds received 32,050 107,276 Receivable at August 31, 2020 $ 39,725 $ 39,725 |
Schedule of Life Settlements | The weighted average life expectancy calculated based on death benefit of insureds in the policies owned by the Company at November 30, 2019 was 11.4 years. Remaining Life Expectancy (In Years)* Number of Life Settlement Contracts Fair Value Face Value 0-1 — $ — $ — 1-2 — — — 2-3 — — — 3-4 — — — 4-5 — — — Thereafter 2 1,297 12,000 Total 2 $ 1,297 $ 12,000 At August 31, 2020, there were 500 policies in the White Eagle portfolio with death benefits of approximately $2.4 billion and the weighted average remaining life expectancy calculated based on death benefit of the insureds in the policies was 6.6 years. Remaining Life Expectancy (In Years)* Number of Life Settlement Contracts Face Value 0-1 9 $ 40,780 1-2 30 114,006 2-3 30 121,696 3-4 54 281,198 4-5 54 253,239 Thereafter 323 1,556,622 Total 500 $ 2,367,541 |
Schedule of Estimated Premiums to be Paid on Life Insurance Policies | Estimated premiums to be paid for each of the five succeeding fiscal years and thereafter to keep the life insurance policies in force as of August 31, 2020, are as follows (in thousands): Year Expected Premiums 2020 $ 25,197 2021 104,768 2022 100,021 2023 93,316 2024 87,998 Thereafter 572,074 $ 983,374 |
White Eagle Revolving Credit _2
White Eagle Revolving Credit Facility (Tables) - White Eagle - Revolving Credit Facility | 9 Months Ended |
Aug. 31, 2020 | |
Debt Instrument [Line Items] | |
Schedule of Payouts Based on LTV | After distributions for premium payments, fees to service providers and payments of interest, a percentage of the collections from policy proceeds are to be paid to the Company, which will vary depending on the then LTV ratio as illustrated below where the valuation is determined by the lenders: LTV Premiums, Interest & Other Fees Principal Distribution to White Eagle - 55% Lender Participation - 45% N/A 100% —% —% —% >65% N/A 100% —% —% 50%-65% N/A 70% 16.5% 13.5% 35%-50% N/A 55% 24.8% 20.3% 0%-35% N/A 45% 30.3% 24.8% |
Schedule of Reconciliation of Proceeds Distributed | The below is a reconciliation of proceeds collected by the White Eagle Revolving Credit Facility and distributed from the collection account in accordance with the budget approved by the Bankruptcy court and the White Eagle Revolving Credit Facility termination agreement (in thousands): Nine Months Ended August 31, 2019 Collection account balance at December 1, 2018 $ 28,059 Face value collected in current quarter 60,163 Face value collected in prior quarters 32,342 Other collections * 2,575 $ 123,139 Expenses paid from the collection account Post-Petition Premiums paid 2019 $ (65,905) Interest expenses (28,331) Payment toward principal (1,804) White Eagle credit facility expenses (9,304) Refund of premium payments advanced by parent (3,000) Lender allowed claim-Beal (5,839) Transfers of remaining funds to Lamington (8,956) $ (123,139) Collection account balance at August 16, 2019** $ — *Includes refund of premiums and interest earned on maturity proceeds ** Collection account was closed on August 16, 2019 in connection with the termination of the White Eagle Revolving Credit Facility. |
Schedule of Advances For Premium Payments and Fees | During the three months and nine months ended August 31, 2019, advances for premium payments and fees to service providers amounted to (in thousands): Three Months Ended August 31, Nine Months Ended August 31, 2019 2019 Amount drawn for premium payments $ — $ 4,221 Total amount drawn $ — $ 4,221 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis | The balances of the Company’s assets measured at fair value on a recurring basis as of August 31, 2020, are as follows (in thousands): Level 1 Level 2 Level 3 Total Fair Value Assets: Investment in limited partnership $ — $ — $ 152,450 $ 152,450 $ — $ — $ 152,450 $ 152,450 The balances of the Company’s assets measured at fair value on a recurring basis as of November 30, 2019, are as follows (in thousands): Level 1 Level 2 Level 3 Total Fair Assets: Investment in limited partnership $ — $ — $ 137,849 $ 137,849 Investment in life settlements — — 1,297 1,297 $ — $ — $ 139,146 $ 139,146 |
Schedule of Quantitative Information about Level 3 Fair Value Measurements | The below is a quantitative analysis of the Company's level 3 assets fair value measurements at August 31, 2020: ($ in thousands) Quantitative Information about Level 3 Fair Value Measurements Fair Value Aggregate Valuation Technique Unobservable Input Range (Weighted Average) Investment in limited partnership $ 152,450 $ 663,033 Discounted cash flow Discount rate 14.04% Life expectancy evaluation, distributions, return on investment |
Schedule of Market Interest Rate Sensitivity Analysis | Market interest rate sensitivity analysis of the investment in limited partnership The extent to which the fair value of the investment in limited partnership could vary in the near term has been quantified by evaluating the effect of changes in the weighted average discount. If the weighted average discount rate were increased or decreased by 1/2 of 1% and the other assumptions used to estimate fair value remained the same, the change in estimated fair value of investment in limited partnership as of August 31, 2020 would be as follows (dollars in thousands): Weighted Average Rate Rate Adjustment Value Change in Value 13.54% (0.50) % $ 156,438 $ 3,988 14.04% — $ 152,450 $ — 14.54% 0.50 % $ 148,616 $ (3,834) |
Schedule of Changes in Fair Value for All Assets Using Material Level of Unobservable (Level 3) Inputs | The following tables provides a roll-forward in the changes in fair value for the nine months ended August 31, 2020, for all assets for which the Company determines fair value using a material level of unobservable (Level 3) inputs (in thousands): Life Settlements - Consolidated: Balance, December 1, 2019 $ 1,297 Sale of policies (2,040) Gain on sale of life settlement 743 Change in fair value — Premiums paid — Balance, August 31, 2020 $ — Changes in fair value included in earnings for the period relating to assets held at August 31, 2020 $ — Investment in Limited Partnership Balance, December 1, 2019 $ 137,849 Change in fair value 20,601 Distributions (6,000) Balance, August 31, 2020 $ 152,450 Changes in fair value included in earnings for the period relating to assets held at August 31, 2020 $ 14,601 The following tables provides a roll-forward in the changes in fair value for the periods ended August 31, 2019, for all assets for which the Company determines fair value using a material level of unobservable (Level 3) inputs, which consists solely of life settlements (in thousands): Life Settlements - Consolidated: Balance, December 1, 2018 $ 1,172 Purchase of policies — Change in fair value (37) Matured/lapsed/sold polices — Premiums paid 118 Balance, August 31, 2019 $ 1,253 Changes in fair value included in earnings for the period relating to assets held at August 31, 2019 $ (37) Life Settlements - Deconsolidated: Balance, December 1, 2018 $ 505,235 Purchase of policies — Change in fair value (16,841) Receivable for maturity of life settlement write off 17,800 Policies sold (344,845) Policies matured (100,373) Premiums paid 69,827 Transfer to investment in limited partnership (130,803) Balance at, August 31, 2019 $ — Changes in fair value included in earnings for the period relating to deconsolidated assets held at August 31, 2019 $ — The following table provides a roll-forward in the changes in fair value for the period ended August 31, 2019, for the investment in deconsolidated subsidiaries for which the Company determines fair value using a material level of unobservable (Level 3) inputs (in thousands): Investment in Deconsolidated Subsidiaries Investment in Lamington at December 1, 2018 $ 128,795 Change in fair value 37,941 Transferred to consolidation (166,736) Investment in Lamington at August 31, 2019 $ — |
Schedule of Changes in Fair Value for All Liabilities Using Material Level of Unobservable (Level 3) Inputs | The following tables provides a roll-forward in the changes in fair value for the periods ended August 31, 2019, for the White Eagle Revolving Credit Facility for which the Company determines fair value using a material level of unobservable (Level 3) inputs (in thousands): White Eagle Revolving Credit Facility - Deconsolidated: Balance, December 1, 2018 $ 346,670 Draws under the White Eagle Revolving Credit Facility 4,221 Payments on White Eagle Revolving Credit Facility (367,985) Unrealized change in fair value 17,094 Balance, August 31, 2019 $ — Changes in fair value included in earnings for the period relating to liabilities at August 31, 2019 $ — |
Description of Business (Detail
Description of Business (Details) | Dec. 04, 2019USD ($)contract | Aug. 16, 2019USD ($) | Oct. 14, 2020numberOfRestructuringAgreements | Sep. 15, 2020numberOfLicenses | Aug. 31, 2020USD ($)contract | Dec. 11, 2019 | Nov. 30, 2019USD ($)contract | Aug. 31, 2019 | Jul. 28, 2017 | Apr. 18, 2017 | |
Organization and Nature of Operations [Line Items] | |||||||||||
Investment in limited partnership | $ 152,450,000 | $ 137,849,000 | [1] | ||||||||
Investment in life settlements fair value | $ 1,297,000 | ||||||||||
Proceeds from maturity of life settlements | $ 12,700,000 | ||||||||||
8.5% Senior Secured Notes | |||||||||||
Organization and Nature of Operations [Line Items] | |||||||||||
Debt interest rate | 8.50% | 8.50% | [1] | 8.50% | 8.50% | ||||||
5.0% Convertible Notes | |||||||||||
Organization and Nature of Operations [Line Items] | |||||||||||
Debt interest rate | 5.00% | 5.00% | [1] | 5.00% | 5.00% | ||||||
Secured Notes | 8.5% Senior Secured Notes | |||||||||||
Organization and Nature of Operations [Line Items] | |||||||||||
Debt interest rate | 8.50% | ||||||||||
Convertible Notes | 5.0% Convertible Notes | |||||||||||
Organization and Nature of Operations [Line Items] | |||||||||||
Debt interest rate | 5.00% | ||||||||||
Subsequent Event | |||||||||||
Organization and Nature of Operations [Line Items] | |||||||||||
Number of restructuring support agreements | numberOfRestructuringAgreements | 2 | ||||||||||
Subsequent Event | Secured Notes | 8.5% Senior Secured Notes | |||||||||||
Organization and Nature of Operations [Line Items] | |||||||||||
Debt interest rate | 8.50% | ||||||||||
Subsequent Event | Convertible Notes | 5.0% Convertible Notes | |||||||||||
Organization and Nature of Operations [Line Items] | |||||||||||
Debt interest rate | 5.00% | ||||||||||
White Eagle | |||||||||||
Organization and Nature of Operations [Line Items] | |||||||||||
Number of life insurance policies canceled | contract | 2 | ||||||||||
Proceeds from maturity of life settlements | $ 2,000,000 | ||||||||||
Sun Life | |||||||||||
Organization and Nature of Operations [Line Items] | |||||||||||
Number of life insurance policies canceled | contract | 31 | ||||||||||
Investment in life settlements fair value | $ 163,500,000 | ||||||||||
Proceeds from maturity of life settlements | 36,100,000 | ||||||||||
Sun Life | White Eagle | |||||||||||
Organization and Nature of Operations [Line Items] | |||||||||||
Investment in life settlements fair value | $ 141,500,000 | ||||||||||
Number of policies owned | contract | 28 | ||||||||||
Number of life insurance policies in receivable for maturity | contract | 1 | ||||||||||
Receivable from maturity of life insurance contracts | $ 10,000,000 | ||||||||||
Payments for sale of life insurance contracts | $ 13,400,000 | ||||||||||
Sun Life | Emergent Capital, Inc. | |||||||||||
Organization and Nature of Operations [Line Items] | |||||||||||
Number of life insurance policies canceled | contract | 2 | ||||||||||
Investment in life settlements fair value | $ 12,000,000 | ||||||||||
Proceeds from maturity of life settlements | 12,700,000 | ||||||||||
Sun Life | Wilmington Trust | |||||||||||
Organization and Nature of Operations [Line Items] | |||||||||||
Payments for sale of life insurance contracts | 10,000,000 | ||||||||||
Sun Life | Class A Interests | White Eagle | |||||||||||
Organization and Nature of Operations [Line Items] | |||||||||||
Payments for sale of life insurance contracts | $ 13,400,000 | ||||||||||
WE Investment | |||||||||||
Organization and Nature of Operations [Line Items] | |||||||||||
Investment in life settlements fair value | $ 2,400,000,000 | ||||||||||
Number of policies owned | contract | 500 | ||||||||||
WE Investment | Lamington | |||||||||||
Organization and Nature of Operations [Line Items] | |||||||||||
Equity investment ownership percentage | 27.50% | ||||||||||
Investment in limited partnership | $ 138,900,000 | $ 152,500,000 | $ 137,800,000 | ||||||||
Subsidiaries | Subsequent Event | ILS | |||||||||||
Organization and Nature of Operations [Line Items] | |||||||||||
Number of states in which life settlement licenses were sold | numberOfLicenses | 12 | ||||||||||
Number of states in which life settlement licenses were surrendered | numberOfLicenses | 17 | ||||||||||
Subsidiaries | WE Investment | |||||||||||
Organization and Nature of Operations [Line Items] | |||||||||||
Equity investment ownership percentage | 27.50% | ||||||||||
Subsidiaries | WE Investment | White Eagle | |||||||||||
Organization and Nature of Operations [Line Items] | |||||||||||
Investment in life settlements fair value | $ 0 | $ 1,297,000 | |||||||||
Number of policies owned | contract | 0 | 2 | |||||||||
Subsidiaries | WE Investment | Lamington | |||||||||||
Organization and Nature of Operations [Line Items] | |||||||||||
Equity investment ownership percentage | 27.50% | ||||||||||
Affiliates | Class A Interests | White Eagle | |||||||||||
Organization and Nature of Operations [Line Items] | |||||||||||
Proceeds from sale of limited partnership interest | $ 366,200,000 | ||||||||||
Affiliates | Class D Interests | White Eagle | |||||||||||
Organization and Nature of Operations [Line Items] | |||||||||||
Proceeds from sale of limited partnership interest | $ 8,000,000 | ||||||||||
Affiliates | Palomino | White Eagle | |||||||||||
Organization and Nature of Operations [Line Items] | |||||||||||
Percentage of equity interest sold | 72.50% | ||||||||||
[1] | Derived from audited consolidated financial statements. |
Principles of Consolidation a_3
Principles of Consolidation and Basis of Presentation (Details) - USD ($) $ in Thousands | Nov. 14, 2018 | Nov. 13, 2018 | Aug. 31, 2020 | Aug. 31, 2019 | Oct. 15, 2020 | Nov. 30, 2019 | [1] | Jul. 28, 2017 |
Organization and Nature of Operations [Line Items] | ||||||||
Accumulated deficit | $ 275,441 | $ 291,513 | ||||||
Cash flows used in operating activities | 8,593 | $ 8,493 | ||||||
Cash and cash equivalents | 19,054 | 24,283 | ||||||
Certificates of deposit | $ 517 | $ 511 | ||||||
White Eagle | Lamington | Limited Partner | ||||||||
Organization and Nature of Operations [Line Items] | ||||||||
Ownership interest percentage | 99.99% | |||||||
White Eagle | Lamington | Limited Partner | Subsidiaries | ||||||||
Organization and Nature of Operations [Line Items] | ||||||||
Ownership interest percentage | 99.99% | 99.99% | ||||||
WEGP | WEGP | General Partner | ||||||||
Organization and Nature of Operations [Line Items] | ||||||||
Ownership interest percentage | 0.01% | |||||||
WEGP | WEGP | General Partner | Subsidiaries | ||||||||
Organization and Nature of Operations [Line Items] | ||||||||
Ownership interest percentage | 0.01% | 0.01% | ||||||
8.5% Senior Secured Notes | ||||||||
Organization and Nature of Operations [Line Items] | ||||||||
Debt interest rate | 8.50% | 8.50% | 8.50% | 8.50% | ||||
8.5% Senior Secured Notes | Senior Secured Notes | ||||||||
Organization and Nature of Operations [Line Items] | ||||||||
Debt interest rate | 8.50% | |||||||
Debt outstanding principal becoming due on July 15, 2021 | $ 47,600 | |||||||
Subsequent Event | ||||||||
Organization and Nature of Operations [Line Items] | ||||||||
Cash and cash equivalents | $ 19,000 | |||||||
Certificates of deposit | 519 | |||||||
Subsequent Event | 8.5% Senior Secured Notes | Senior Secured Notes | ||||||||
Organization and Nature of Operations [Line Items] | ||||||||
Debt outstanding principal becoming due on July 15, 2021 | $ 47,600 | |||||||
[1] | Derived from audited consolidated financial statements. |
Recent Accounting Pronounceme_3
Recent Accounting Pronouncements - Impact of Adoption of ASU 2016-02 Leases (Topic 842) on Consolidated Financial Statements (Details) - USD ($) $ in Thousands | Dec. 01, 2019 | Aug. 31, 2020 | May 31, 2020 | Feb. 29, 2020 | Nov. 30, 2019 | Aug. 31, 2019 | May 31, 2019 | Feb. 28, 2019 | Nov. 30, 2018 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201602Member | ||||||||||
Assets | |||||||||||
Prepaid expenses and other assets | $ 1,152 | $ 377 | [1] | ||||||||
Operating lease assets | 22 | ||||||||||
Total assets | 174,407 | 165,712 | [1] | ||||||||
Liabilities | |||||||||||
Other liabilities | 0 | 86 | [1] | ||||||||
Total liabilities | 116,148 | 123,599 | [1] | ||||||||
Total stockholders' equity | 58,259 | $ 59,266 | $ 54,582 | 42,113 | [1] | $ 44,443 | $ (35,923) | $ (10,136) | $ 27,242 | ||
Total liabilities and stockholders' equity | $ 174,407 | 165,712 | [1] | ||||||||
Net effect | [1] | $ 0 | |||||||||
As reported under ASU 2016-02 | |||||||||||
Assets | |||||||||||
Prepaid expenses and other assets | $ 353 | ||||||||||
Operating lease assets | 132 | ||||||||||
Total assets | 165,868 | ||||||||||
Liabilities | |||||||||||
Other liabilities | 39 | ||||||||||
Operating lease liability | 203 | ||||||||||
Total liabilities | 123,755 | ||||||||||
Total stockholders' equity | 42,113 | ||||||||||
Total liabilities and stockholders' equity | 165,868 | ||||||||||
Net effect | 0 | ||||||||||
Effect of change | |||||||||||
Assets | |||||||||||
Prepaid expenses and other assets | 24 | ||||||||||
Operating lease assets | 132 | ||||||||||
Total assets | 156 | ||||||||||
Liabilities | |||||||||||
Other liabilities | (47) | ||||||||||
Operating lease liability | 203 | ||||||||||
Total liabilities | 156 | ||||||||||
Total stockholders' equity | 0 | ||||||||||
Total liabilities and stockholders' equity | 156 | ||||||||||
Net effect | $ 0 | ||||||||||
[1] | Derived from audited consolidated financial statements. |
Deconsolidation of Subsidiari_3
Deconsolidation of Subsidiaries - Narrative (Details) | Nov. 13, 2018 |
White Eagle | Limited Partner | Lamington | |
Noncontrolling Interest [Line Items] | |
Ownership interest percentage | 99.99% |
WEGP | General Partner | WEGP | |
Noncontrolling Interest [Line Items] | |
Ownership interest percentage | 0.01% |
Deconsolidation of Subsidiari_4
Deconsolidation of Subsidiaries - Fair Value of Investment in Lamington (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | Aug. 16, 2019 | ||
Investment in Deconsolidated Subsidiary [Roll Forward] | ||||||
Investment in Lamington at December 1, 2018 | [1] | $ 137,849 | ||||
Change in fair value | $ 0 | $ 90,710 | 0 | $ 37,941 | ||
Investment in Lamington at August 16, 2019 | $ 152,450 | $ 152,450 | ||||
Lamington | ||||||
Investment in Deconsolidated Subsidiary [Roll Forward] | ||||||
Investment in Lamington at December 1, 2018 | $ 128,795 | $ 128,795 | ||||
Change in fair value | 37,941 | |||||
Investment in Lamington at August 16, 2019 | $ 166,736 | |||||
[1] | Derived from audited consolidated financial statements. |
Deconsolidation of Subsidiari_5
Deconsolidation of Subsidiaries - Company's Investment in Deconsolidated Entities (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | Aug. 16, 2019 | ||
Investment in Deconsolidated Subsidiary [Roll Forward] | ||||||
Investment in Lamington at December 1, 2018 | [1] | $ 137,849 | ||||
Change in fair value | $ 0 | $ 90,710 | 0 | $ 37,941 | ||
Investment in Lamington at August 16, 2019 | $ 152,450 | $ 152,450 | ||||
Lamington | ||||||
Investment in Deconsolidated Subsidiary [Roll Forward] | ||||||
Investment in Lamington at December 1, 2018 | 128,795 | $ 128,795 | ||||
Change in fair value | 37,941 | |||||
Investment in Lamington at August 16, 2019 | 166,736 | |||||
Lamington | Promissory notes | ||||||
Investment in Deconsolidated Subsidiary [Roll Forward] | ||||||
Investment in Lamington at December 1, 2018 | 56,596 | 56,596 | ||||
Change in fair value | 89,736 | |||||
Investment in Lamington at August 16, 2019 | 146,332 | |||||
Lamington | Other liabilities | ||||||
Investment in Deconsolidated Subsidiary [Roll Forward] | ||||||
Investment in Lamington at December 1, 2018 | 5,948 | 5,948 | ||||
Change in fair value | (5,948) | |||||
Investment in Lamington at August 16, 2019 | 0 | |||||
Lamington | Equity investment | ||||||
Investment in Deconsolidated Subsidiary [Roll Forward] | ||||||
Investment in Lamington at December 1, 2018 | $ 66,251 | 66,251 | ||||
Change in fair value | (45,847) | |||||
Investment in Lamington at August 16, 2019 | $ 20,404 | |||||
[1] | Derived from audited consolidated financial statements. |
Condensed and Consolidated Fi_3
Condensed and Consolidated Financial Statements for Entities in Bankruptcy - Condensed and Consolidated Statements of Operations (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | |
Condensed Income Statements, Captions [Line Items] | ||||
Change in fair value of life settlements (Notes 10 & 16) | $ 0 | $ (42,000) | $ 0 | $ (37,000) |
Change in fair value of investment in limited partnership, net of distributions (Notes 11 and 16) | 4,250,000 | (5,821,000) | 20,601,000 | (5,821,000) |
Gain on life settlements, net (Note 10) | 0 | 0 | 743,000 | 0 |
Other income | 57,000 | 2,052,000 | 10,875,000 | 2,145,000 |
Total income | 4,307,000 | 86,899,000 | 32,219,000 | 34,228,000 |
Interest expense | 2,743,000 | 2,832,000 | 7,610,000 | 8,370,000 |
Loss on extinguishment of debt | 0 | 0 | (2,815,000) | 0 |
Legal fees | 738,000 | 1,448,000 | 1,850,000 | 2,117,000 |
Professional fees | 619,000 | 1,142,000 | 2,034,000 | 1,470,000 |
Other selling, general and administrative expenses | 272,000 | 317,000 | 792,000 | 516,000 |
Total expenses | 5,335,000 | 6,703,000 | 13,664,000 | 14,140,000 |
Income taxes | 0 | (5,000) | 2,428,000 | 3,213,000 |
Net income (loss) from continuing operations | (1,028,000) | 80,201,000 | 16,127,000 | 16,875,000 |
Subsidiaries | Lamington | ||||
Condensed Income Statements, Captions [Line Items] | ||||
Change in fair value of life settlements (Notes 10 & 16) | 0 | 12,985,000 | 0 | (16,841,000) |
Change in fair value of investment in limited partnership, net of distributions (Notes 11 and 16) | 0 | 15,352,000 | 0 | 15,352,000 |
Gain on life settlements, net (Note 10) | 0 | 21,336,000 | 0 | 21,336,000 |
Other income | 0 | 345,000 | 0 | 709,000 |
Total income | 0 | 50,018,000 | 0 | 20,556,000 |
Interest expense | 0 | 23,331,000 | 0 | 28,331,000 |
Change in fair value of White Eagle Revolving Credit Facility (Notes 12 & 16) | 0 | (26,586,000) | 0 | 17,094,000 |
Loss on extinguishment of debt | 0 | 7,360,000 | 0 | 7,360,000 |
Reorganization cost | 0 | 4,769,000 | 0 | 13,954,000 |
Legal fees | 0 | 158,000 | 0 | 890,000 |
Professional fees | 0 | 659,000 | 0 | 1,549,000 |
Administrative service fees - affiliate | 0 | 0 | 0 | 2,765,000 |
Other selling, general and administrative expenses | 0 | (71,000) | 0 | 469,000 |
Total expenses | 0 | 9,620,000 | 0 | 72,412,000 |
Income taxes | 0 | 0 | 0 | 0 |
Net income (loss) from continuing operations | $ 0 | $ 40,398,000 | $ 0 | $ (51,856,000) |
Condensed and Consolidated Fi_4
Condensed and Consolidated Financial Statements for Entities in Bankruptcy - Condensed and Consolidated Cash Flow Statements (Details) - USD ($) $ in Thousands | Dec. 04, 2019 | Aug. 31, 2020 | Aug. 31, 2019 |
Condensed Cash Flow Statements, Captions [Line Items] | |||
Net cash used in operating activities | $ (8,593) | $ (8,493) | |
Cash flows from investing activities | |||
Premiums paid on life settlements | 0 | (118) | |
Proceeds from maturity of life settlements | $ 12,700 | ||
Net cash (used in) provided by investing activities | 8,041 | 10,782 | |
Cash flows from financing activities | |||
Net cash provided by financing activities | (4,677) | 5,282 | |
Cash and cash equivalents, at beginning of the period | 24,283 | 1,209 | |
Cash and cash equivalents, at end of the period | 19,054 | 8,780 | |
Supplemental disclosures of cash flow information: | |||
Cash paid for interest during the period | 6,594 | 4,430 | |
Cash Flow, Noncash Investing and Financing Activities Disclosure [Abstract] | |||
Repayment of White Eagle Revolving Credit Facility by third party from proceeds of sale of life settlement | 0 | 366,821 | |
White Eagle early extinguishment fees paid by third party from proceeds of Class D Shares | 0 | 7,360 | |
Subsidiaries | Lamington | |||
Condensed Cash Flow Statements, Captions [Line Items] | |||
Net cash used in operating activities | 0 | (58,793) | |
Cash flows from investing activities | |||
Premiums paid on life settlements | 0 | (69,827) | |
Proceeds from maturity of life settlements | 0 | 92,505 | |
Net cash (used in) provided by investing activities | 0 | 22,678 | |
Cash flows from financing activities | |||
Repayment of borrowings under White Eagle Revolving Credit Facility | 0 | (1,804) | |
Borrowings from White Eagle Revolving Credit Facility | 0 | 4,221 | |
Cash distributed to Parent Company | 0 | (21) | |
Net cash provided by financing activities | 0 | 2,396 | |
Net increase (decrease) in cash and cash equivalents | 0 | (33,719) | |
Cash and cash equivalents, at beginning of the period | 0 | 33,719 | |
Cash and cash equivalents, at end of the period | 0 | 0 | |
Supplemental disclosures of cash flow information: | |||
Cash paid for interest during the period | $ 0 | $ 28,331 |
Condensed and Consolidated Fi_5
Condensed and Consolidated Financial Statements for Entities in Bankruptcy - Narrative (Details) - USD ($) | Jul. 28, 2017 | May 16, 2014 | Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | Aug. 16, 2019 |
Condensed Financial Statements, Captions [Line Items] | |||||||
Change in fair value of notes | $ 0 | $ 37,941,000 | |||||
Change in fair value of investment in deconsolidated subsidiaries (Notes 4 & 16) | $ 0 | $ 90,710,000 | 0 | 37,941,000 | |||
Lamington | |||||||
Condensed Financial Statements, Captions [Line Items] | |||||||
Change in fair value of investment in deconsolidated subsidiaries (Notes 4 & 16) | $ 37,941,000 | ||||||
Lamington | Promissory notes | |||||||
Condensed Financial Statements, Captions [Line Items] | |||||||
Change in fair value of investment in deconsolidated subsidiaries (Notes 4 & 16) | 89,736,000 | ||||||
Lamington | Senior Notes | 8.5% Promissory Note | |||||||
Condensed Financial Statements, Captions [Line Items] | |||||||
Debt instrument term | 10 years | ||||||
Debt issued | $ 59,300,000 | ||||||
Debt interest rate | 8.50% | ||||||
Period to capitalize outstanding principal balance | 7 days | ||||||
Outstanding principal balance | 86,500,000 | 86,500,000 | |||||
Capitalized interest included in outstanding principal balance | 27,200,000 | 27,200,000 | |||||
Principal payments due prior to maturity date | 0 | 0 | |||||
Lamington | Senior Notes | Special Dividend Note | |||||||
Condensed Financial Statements, Captions [Line Items] | |||||||
Debt issued | $ 57,000,000 | ||||||
Debt interest rate | 5.00% | ||||||
Outstanding principal balance | 59,900,000 | 59,900,000 | |||||
Capitalized interest included in outstanding principal balance | 2,900,000 | 2,900,000 | |||||
Principal payments due prior to maturity date | 0 | 0 | |||||
Period after which interest shall be capitalized if accrued interest is not paid | 7 days | ||||||
Fair value of notes | $ 146,300,000 | ||||||
Subsidiaries | Lamington | |||||||
Condensed Financial Statements, Captions [Line Items] | |||||||
Administrative service fees - affiliate | $ 0 | $ 0 | $ 0 | $ 2,765,000 |
Consolidation of Variable Int_3
Consolidation of Variable Interest Entities - Consolidated Assets and Liabilities (Details) - Not Primary Beneficiary - USD ($) $ in Thousands | Aug. 31, 2020 | Nov. 30, 2019 |
Variable Interest Entity [Line Items] | ||
Non-consolidated VIE, assets | $ 0 | $ 0 |
Non-consolidated VIE, maximum exposure to loss | 0 | 0 |
White Eagle | ||
Variable Interest Entity [Line Items] | ||
Non-consolidated VIE, assets | 152,450 | 137,849 |
Non-consolidated VIE, maximum exposure to loss | $ 152,450 | $ 137,849 |
Consolidation of Variable Int_4
Consolidation of Variable Interest Entities - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Nov. 30, 2019 | Aug. 31, 2020 | Aug. 16, 2019 | ||
Variable Interest Entity [Line Items] | ||||
Investment in limited partnership | $ 137,849 | [1] | $ 152,450 | |
Palomino | White Eagle | Affiliates | ||||
Variable Interest Entity [Line Items] | ||||
Percentage of equity interest sold | 72.50% | |||
WE Investment | Subsidiaries | ||||
Variable Interest Entity [Line Items] | ||||
Equity investment ownership percentage | 27.50% | |||
WE Investment | Lamington | ||||
Variable Interest Entity [Line Items] | ||||
Equity investment ownership percentage | 27.50% | |||
Investment in limited partnership | 137,800 | $ 152,500 | $ 138,900 | |
WE Investment | Lamington | Subsidiaries | ||||
Variable Interest Entity [Line Items] | ||||
Equity investment ownership percentage | 27.50% | |||
WE Investment | Lamington | Class B Interests | Subsidiaries | ||||
Variable Interest Entity [Line Items] | ||||
Equity investment ownership percentage | 27.50% | |||
Discontinued operations, disposed of by sale | ||||
Variable Interest Entity [Line Items] | ||||
Fair value loss on investment in affiliate due to restructuring | $ 2,400 | |||
[1] | Derived from audited consolidated financial statements. |
Earnings Per Share - Narrative
Earnings Per Share - Narrative (Details) - shares | Aug. 31, 2020 | Nov. 30, 2019 | [1] | Aug. 31, 2019 |
Earnings Per Share [Abstract] | ||||
Common stock, shares issued (in shares) | 159,263,140 | 158,365,275 | 158,659,803 | |
Common stock, shares outstanding (in shares) | 158,655,140 | 157,757,275 | 158,051,803 | |
Treasury stock (in shares) | 608,000 | 608,000 | 608,000 | |
[1] | Derived from audited consolidated financial statements. |
Earnings Per Share - Reconcilia
Earnings Per Share - Reconciliation (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Aug. 31, 2020 | May 31, 2020 | Feb. 29, 2020 | Aug. 31, 2019 | May 31, 2019 | Feb. 28, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | |
Numerator: | ||||||||
Net income (loss) from continuing operations | $ (1,028) | $ 80,201 | $ 16,127 | $ 16,875 | ||||
Net income (loss) from discontinued operations | 0 | 70 | (53) | 36 | ||||
Net income (loss) | (1,028) | $ 4,662 | $ 12,438 | 80,271 | $ (25,884) | $ (37,476) | 16,074 | 16,911 |
Add back convertible notes interest | 0 | 1,095 | 2,996 | 3,270 | ||||
Numerator for diluted earnings per share - net income (loss) attributable to common stockholders | $ (1,028) | $ 81,296 | $ 19,123 | $ 20,145 | ||||
Basic income (loss) per common share: | ||||||||
Basic income (loss) from continuing operations (in dollars per share) | $ (0.01) | $ 0.51 | $ 0.10 | $ 0.11 | ||||
Basic income (loss) from discontinued operations (in dollars per share) | 0 | 0 | 0 | 0 | ||||
Net income (loss) - basic (in dollars per share) | (0.01) | 0.51 | 0.10 | 0.11 | ||||
Diluted income (loss) per common share: | ||||||||
Diluted income (loss) from continuing operations (in dollars per share) | (0.01) | 0.41 | 0.09 | 0.10 | ||||
Diluted income (loss) from discontinued operations (in dollars per share) | 0 | 0 | 0 | 0 | ||||
Net income (loss) - diluted (in dollars per share) | $ (0.01) | $ 0.41 | $ 0.09 | $ 0.10 | ||||
Denominator: | ||||||||
Basic (in shares) | 157,655,140 | 156,968,470 | 157,624,241 | 156,949,425 | ||||
Diluted (in shares) | 157,655,140 | 195,979,957 | 206,696,703 | 194,867,908 |
Earnings Per Share - Reconcil_2
Earnings Per Share - Reconciliation Narrative (Details) - shares | 3 Months Ended | 9 Months Ended | |||||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | Nov. 30, 2019 | [1] | Apr. 18, 2017 | |
5.0% Convertible Notes | |||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||
Debt interest rate | 5.00% | 5.00% | 5.00% | 5.00% | 5.00% | 5.00% | |
Stock Appreciation Rights | |||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||
Antidilutive securities excluded from computation of diluted earnings per share (in shares) | 100,000 | 100,000 | 100,000 | 100,000 | |||
Restricted Stock | |||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||
Antidilutive securities excluded from computation of diluted earnings per share (in shares) | 1,000,000 | 1,083,333 | |||||
Warrants | |||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||
Antidilutive securities excluded from computation of diluted earnings per share (in shares) | 42,500,000 | 2,000,000 | 44,500,000 | ||||
Convertible Debt Securities | 5.0% Convertible Notes | |||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||
Antidilutive securities excluded from computation of diluted earnings per share (in shares) | 33,918,483 | ||||||
Stock Options | |||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||
Antidilutive securities excluded from computation of diluted earnings per share (in shares) | 85,000 | 85,000 | |||||
[1] | Derived from audited consolidated financial statements. |
Stock-based Compensation - Narr
Stock-based Compensation - Narrative (Details) - USD ($) | Jun. 27, 2017 | Jun. 06, 2013 | Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | Nov. 30, 2018 | Nov. 30, 2019 | Nov. 30, 2018 | Dec. 31, 2017 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Options fully vested and exercisable (in shares) | 0 | 0 | 85,000 | |||||||
Number of options expired (in shares) | 85,000 | |||||||||
Weighted average remaining contractual term of unvested awards | 6 months 21 days | |||||||||
Options granted (in shares) | 0 | |||||||||
Exercise price of options (in dollars per share) | $ 0 | |||||||||
Restricted Stock | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Awards granted (in shares) | 1,000,000 | |||||||||
Awards vested (in shares) | 333,333 | |||||||||
Awards unvested (in shares) | 1,000,000 | 1,000,000 | 333,333 | |||||||
Restricted Stock | Certain Employees | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Stock-based compensation expense | $ 21,000 | $ 95,000 | $ 74,000 | $ 290,000 | ||||||
SARs | Sole Non-employee Member of the Committee | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Expiration period of awards | 10 years | |||||||||
Fair value of unvested awards | $ 9,000 | |||||||||
Options granted (in shares) | 100,000 | |||||||||
Exercise price of options (in dollars per share) | $ 1 | |||||||||
Options vested (in shares) | 100,000 | |||||||||
Options unexercised (in shares) | 100,000 | 100,000 | ||||||||
Omnibus Plan | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Additional shares of common stock authorized for issuance (in shares) | 9,900,000 | |||||||||
Omnibus Plan | Options | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Shares of common stock reserved for issuance (in shares) | 12,600,000 | 12,600,000 | ||||||||
Stock-based compensation expense | $ 0 | 0 | $ 0 | 0 | ||||||
Expiration period of awards | 7 years | |||||||||
Omnibus Plan | Restricted Stock | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Awards vested (in shares) | 2,270,000 | |||||||||
Omnibus Plan | Restricted Stock | Certain Employees | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Awards granted (in shares) | 3,270,000 | |||||||||
Awards unvested (in shares) | 1,000,000 | 1,000,000 | ||||||||
Aggregate intrinsic value of unvested awards | $ 340,000 | $ 340,000 | ||||||||
Weighted average remaining contractual term of unvested awards | 2 years 4 months 28 days | |||||||||
Stock based compensation not yet recognized | 200,000 | $ 200,000 | ||||||||
Omnibus Plan | Restricted Stock | Chief Executive Officer | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Stock-based compensation expense | $ 21,000 | $ 50,000 | ||||||||
Awards granted (in shares) | 1,000,000 | |||||||||
Awards vesting period | 3 years | |||||||||
Fair value of unvested awards | $ 250,000 | |||||||||
Awards unvested (in shares) | 1,000,000 | 1,000,000 | ||||||||
Omnibus Plan | Restricted Stock | Chief Executive Officer | First anniversary of the grant date | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Awards vesting percentage | 33.33% | |||||||||
Omnibus Plan | Restricted Stock | Chief Executive Officer | Second anniversary of the grant date | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Awards vesting percentage | 33.33% | |||||||||
Omnibus Plan | Restricted Stock | Chief Executive Officer | Third anniversary of the grant date | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Awards vesting percentage | 33.33% | |||||||||
Omnibus Plan | Restricted Stock Units | Certain Employees | 2017 Grant | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Stock-based compensation expense | $ 0 | 89,000 | $ 0 | 271,000 | ||||||
Awards granted (in shares) | 2,000,000 | |||||||||
Awards vesting period | 2 years | |||||||||
Fair value of unvested awards | $ 745,000 | |||||||||
Awards vested (in shares) | 250,000 | 750,000 | 1,000,000 | |||||||
Awards unvested (in shares) | 0 | 0 | ||||||||
Omnibus Plan | Restricted Stock Units | Certain Employees | 2018 Grant | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Stock-based compensation expense | $ 0 | $ 6,000 | $ 14,000 | $ 19,000 | ||||||
Awards granted (in shares) | 150,000 | |||||||||
Fair value of unvested awards | $ 58,000 | |||||||||
Awards vested (in shares) | 0 | 83,333 | 66,667 | |||||||
Awards unvested (in shares) | 0 | 0 | ||||||||
Omnibus Plan | Restricted Stock Units | Certain Employees | 2018 Grant | First anniversary of the grant date | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Awards vesting period | 2 years | |||||||||
Awards unvested (in shares) | 100,000 | 100,000 | ||||||||
Omnibus Plan | Restricted Stock Units | Certain Employees | 2018 Grant | Second anniversary of the grant date | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Awards vesting period | 3 years | |||||||||
Awards unvested (in shares) | 50,000 | 50,000 |
Stock-based Compensation - Comm
Stock-based Compensation - Common Stock Options Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended |
Aug. 31, 2020 | Nov. 30, 2019 | |
Number of Shares | ||
Outstanding Balance, December 1, 2019 (in shares) | 85,000 | |
Options granted (in shares) | 0 | |
Options exercised (in shares) | 0 | |
Options forfeited (in shares) | 0 | |
Options expired (in shares) | (85,000) | |
Options outstanding, August 31, 2020 (in shares) | 0 | 85,000 |
Exercisable at August 31, 2020 (in shares) | 0 | 85,000 |
Unvested at August 31, 2020 (in shares) | 0 | |
Weighted Average Exercise Price per Share | ||
Outstanding Balance, December 1, 2019 (in dollars per share) | $ 6.94 | |
Options granted (in dollars per share) | 0 | |
Options exercised (in dollars per share) | 0 | |
Options forfeited (in dollars per share) | 0 | |
Options expired (in dollars per share) | 6.94 | |
Options outstanding, August 31, 2020 (in dollars per share) | 0 | $ 6.94 |
Exercisable at August 31, 2020 (in dollars per share) | 0 | |
Unvested at August 31, 2020 (in dollars per share) | $ 0 | |
Weighted Average Remaining Contractual Term | ||
Outstanding Balance, December 1, 2019 | 6 months 21 days | |
Aggregate Intrinsic Value | ||
Outstanding Balance, December 31, 2019 | $ 0 | |
Options outstanding, August 31, 2020 | 0 | $ 0 |
Unvested at August 31, 2020 | $ 0 |
Stock-based Compensation - Acti
Stock-based Compensation - Activity of Unvested Shares of Restricted Stock (Details) - Restricted Stock | 9 Months Ended |
Aug. 31, 2020shares | |
Number of Shares | |
Outstanding Balance, December 31, 2019 (in shares) | 333,333 |
Granted (in shares) | 1,000,000 |
Vested (in shares) | (333,333) |
Forfeited (in shares) | 0 |
Outstanding August 31, 2020 (in shares) | 1,000,000 |
Discontinued Operations (Detail
Discontinued Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Income (loss) before income taxes | $ 0 | $ 70 | $ (53) | $ 36 |
Provision (benefit) provision for income taxes | 0 | 0 | 0 | 0 |
Net income (loss) from discontinued operations | 0 | 70 | (53) | 36 |
Discontinued operations, disposed of by sale | Structured Settlement Business | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Total income | 0 | 0 | 0 | 0 |
Total expenses | 0 | (70) | 53 | (36) |
Income (loss) before income taxes | 0 | 70 | (53) | 36 |
Provision (benefit) provision for income taxes | 0 | 0 | 0 | 0 |
Net income (loss) from discontinued operations | $ 0 | $ 70 | $ (53) | $ 36 |
Life Settlements (Life Insura_3
Life Settlements (Life Insurance Policies) - Narrative (Details) | Dec. 04, 2019USD ($)contract | Aug. 31, 2020USD ($)contract | Aug. 31, 2019USD ($) | Aug. 31, 2020USD ($)contract | Aug. 31, 2019USD ($) | Nov. 30, 2019USD ($)contract |
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||||||
Investment in life settlements fair value | $ 1,297,000 | |||||
Proceeds from maturity of life settlements | $ 12,700,000 | |||||
Legal fees | $ 738,000 | $ 1,448,000 | $ 1,850,000 | $ 2,117,000 | ||
White Eagle | ||||||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||||||
Number of life insurance policies canceled | contract | 2 | |||||
Proceeds from maturity of life settlements | $ 2,000,000 | |||||
Sun Life | ||||||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||||||
Investment in life settlements fair value | $ 163,500,000 | |||||
Number of life insurance policies canceled | contract | 31 | |||||
Proceeds from maturity of life settlements | $ 36,100,000 | |||||
Gain on disposal of life insurance policies | 743,000 | |||||
Legal fees | $ 10,600,000 | |||||
Sun Life | White Eagle | ||||||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||||||
Number of policies owned | contract | 28 | |||||
Investment in life settlements fair value | $ 141,500,000 | |||||
Number of life insurance policies in receivable for maturity | contract | 1 | |||||
Receivable from maturity of life insurance contracts | $ 10,000,000 | |||||
Payments for sale of life insurance contracts | 13,400,000 | |||||
Sun Life | Emergent Capital, Inc. | ||||||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||||||
Investment in life settlements fair value | $ 12,000,000 | |||||
Number of life insurance policies canceled | contract | 2 | |||||
Proceeds from maturity of life settlements | $ 12,700,000 | |||||
Sun Life | Wilmington Trust | ||||||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||||||
Payments for sale of life insurance contracts | $ 10,000,000 | |||||
WE Investment | ||||||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||||||
Number of policies owned | contract | 500 | 500 | ||||
Investment in life settlements fair value | $ 2,400,000,000 | $ 2,400,000,000 | ||||
Life insurance policies with aggregate death benefit | $ 2,367,541,000 | $ 2,367,541,000 | ||||
Weighted average life expectancy on death benefits insured | 6 years 7 months 6 days | |||||
WE Investment | White Eagle | Subsidiaries | ||||||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||||||
Number of policies owned | contract | 0 | 0 | 2 | |||
Investment in life settlements fair value | $ 0 | $ 0 | $ 1,297,000 | |||
Life insurance policies with aggregate death benefit | $ 0 | $ 0 | $ 12,000,000 | |||
Weighted average life expectancy on death benefits insured | 11 years 4 months 24 days |
Life Settlements (Life Insura_4
Life Settlements (Life Insurance Policies) - Schedule of Life Settlements (Details) | Aug. 31, 2020USD ($)contract | Nov. 30, 2019USD ($)contract |
Fair Value | ||
Total | $ 1,297,000 | |
WE Investment | ||
Number of Life Settlement Contracts | ||
0-1 | contract | 9 | |
1-2 | contract | 30 | |
2-3 | contract | 30 | |
3-4 | contract | 54 | |
4-5 | contract | 54 | |
Thereafter | contract | 323 | |
Total | contract | 500 | |
Fair Value | ||
Total | $ 2,400,000,000 | |
Face Value | ||
0-1 | 40,780,000 | |
1-2 | 114,006,000 | |
2-3 | 121,696,000 | |
3-4 | 281,198,000 | |
4-5 | 253,239,000 | |
Thereafter | 1,556,622,000 | |
Total | $ 2,367,541,000 | |
WE Investment | Subsidiaries | White Eagle | ||
Number of Life Settlement Contracts | ||
0-1 | contract | 0 | |
1-2 | contract | 0 | |
2-3 | contract | 0 | |
3-4 | contract | 0 | |
4-5 | contract | 0 | |
Thereafter | contract | 2 | |
Total | contract | 0 | 2 |
Fair Value | ||
0-1 | $ 0 | |
1-2 | 0 | |
2-3 | 0 | |
3-4 | 0 | |
4-5 | 0 | |
Thereafter | 1,297,000 | |
Total | $ 0 | 1,297,000 |
Face Value | ||
0-1 | 0 | |
1-2 | 0 | |
2-3 | 0 | |
3-4 | 0 | |
4-5 | 0 | |
Thereafter | 12,000,000 | |
Total | $ 0 | $ 12,000,000 |
Investment in Limited Partner_3
Investment in Limited Partnership - Narrative (Details) | Dec. 04, 2019USD ($)contract | Aug. 16, 2019USD ($) | Oct. 15, 2020USD ($) | Aug. 31, 2020USD ($)contract | Aug. 31, 2019USD ($) | Aug. 31, 2020USD ($)contract | Aug. 31, 2019USD ($) | May 31, 2020USD ($) | Nov. 30, 2019USD ($) | |
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Premium/expense reserve | $ 26,123,000 | $ 21,800,000 | $ 26,123,000 | $ 21,800,000 | $ 22,224,000 | $ 4,195,000 | ||||
Premium/expense reserve distributions | 30,289,000 | 8,210,000 | 85,241,000 | 8,210,000 | ||||||
Investment in life settlements fair value | 1,297,000 | |||||||||
Proceeds from maturity of life settlements | $ 12,700,000 | |||||||||
Distributions paid to Class A Partner to satisfy minimum return | 34,188,000 | 117,138,000 | ||||||||
Distributions received from premium/expense account | 34,200,000 | 107,200,000 | ||||||||
Balance on collection account pending distribution | 3,777,000 | 3,777,000 | 5,643,000 | 13,007,000 | ||||||
Face value of life insurance policies matured | 43,225,000 | 133,275,000 | ||||||||
Maturity proceeds received - face | 32,050,000 | 107,276,000 | ||||||||
Receivable for maturity of life insurance policies | 39,725,000 | 39,725,000 | $ 28,550,000 | 13,726,000 | ||||||
Investment in limited partnership | 152,450,000 | 152,450,000 | 137,849,000 | [1] | ||||||
Change in fair value of investment in limited partnership, net of distributions (Notes 11 and 16) | 4,250,000 | $ (5,821,000) | 20,601,000 | $ (5,821,000) | ||||||
White Eagle | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Number of life insurance policies matured | contract | 2 | |||||||||
Proceeds from maturity of life settlements | $ 2,000,000 | |||||||||
Affiliates | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Contributions to premium/expense account | 26,600,000 | 74,000,000 | ||||||||
Accrued and unpaid interest outstanding | 1,000,000 | 1,000,000 | ||||||||
WE Investment | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Investment in life settlements fair value | $ 2,400,000,000 | $ 2,400,000,000 | ||||||||
Life insurance, number of policies | contract | 500 | 500 | ||||||||
Weighted average life expectancy of life settlement contracts | 6 years 7 months 6 days | |||||||||
Estimated future premium payments on life settlement contracts | $ 983,374,000 | $ 983,374,000 | ||||||||
WE Investment | Lamington | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Equity investment ownership percentage | 27.50% | |||||||||
Investment in limited partnership | $ 138,900,000 | $ 152,500,000 | $ 152,500,000 | $ 137,800,000 | ||||||
Palomino | Affiliates | White Eagle | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Percentage of equity interest sold | 72.50% | |||||||||
Sun Life | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Number of life insurance policies matured | contract | 31 | |||||||||
Investment in life settlements fair value | $ 163,500,000 | |||||||||
Proceeds from maturity of life settlements | 36,100,000 | |||||||||
Sun Life | White Eagle | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Investment in life settlements fair value | $ 141,500,000 | |||||||||
Life insurance, number of policies | contract | 28 | |||||||||
Number of life insurance policies in receivable for maturity | contract | 1 | |||||||||
Receivable from maturity of life insurance contracts | $ 10,000,000 | |||||||||
Payments for sale of life insurance contracts | $ 13,400,000 | |||||||||
Sun Life | Emergent Capital, Inc. | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Number of life insurance policies matured | contract | 2 | |||||||||
Investment in life settlements fair value | $ 12,000,000 | |||||||||
Proceeds from maturity of life settlements | 12,700,000 | |||||||||
Sun Life | Wilmington Trust | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Payments for sale of life insurance contracts | 10,000,000 | |||||||||
Revolving Credit Facility | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Repayment of outstanding principal on line of credit | $ 368,000,000 | |||||||||
Repayment of accrued and unpaid interest on line of credit | 21,300,000 | |||||||||
Revolving Credit Facility | CLMG | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Line of credit payoff | 402,500,000 | |||||||||
Revolving Credit Facility | CLMG | White Eagle | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Line of credit payoff | 28,300,000 | |||||||||
Revolving Credit Facility | LNV | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Early repayments of line of credit | 7,400,000 | |||||||||
Lender-allowed claims | $ 5,800,000 | |||||||||
Collateral pledged | WE Investment | Lamington | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Equity investment ownership percentage | 27.50% | |||||||||
Collateral pledged | Revolving Credit Facility | White Eagle | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Number of life insurance policies matured | contract | 13 | 33 | ||||||||
Gain on maturities of life insurance policies | $ 30,000,000 | $ 78,500,000 | ||||||||
Weighted average age of life insurance policies matured | 88 years 10 months 24 days | 88 years 7 months 6 days | ||||||||
Weighted average remaining life expectancy of life insurance policies matured | 4 years 6 months | 4 years 1 month 6 days | ||||||||
Ratio of realized gains of life insurance policies | 69.00% | 58.90% | ||||||||
Class A Interests | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Premium/expense reserve distributions | $ 1,800,000 | $ 1,700,000 | $ 5,300,000 | |||||||
Class A Interests | Affiliates | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Internal rate of return guaranteed to majority owner of partnership investment | 11.00% | |||||||||
Initial contribution percentage | 100.00% | |||||||||
Percentage of amounts funded into premium/expense | 100.00% | |||||||||
Premium/expense reserve | $ 30,000,000 | |||||||||
Premium/expense reserve distributions | 8,300,000 | |||||||||
Contributions to premium/expense account | 21,800,000 | |||||||||
Class A Interests | Affiliates | For the first 3 years | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Proceeds from sale of limited partnership interest | $ 8,000,000 | |||||||||
Period for distribution of proceeds from limited partnership interest | 3 years | |||||||||
Class A Interests | Affiliates | For the subsequent 7 years | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Proceeds from sale of limited partnership interest | $ 4,000,000 | |||||||||
Period for distribution of proceeds from limited partnership interest | 7 years | |||||||||
Class A Interests | Affiliates | White Eagle | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Proceeds from sale of limited partnership interest | $ 366,200,000 | |||||||||
Class A Interests | Affiliates | Subsequent Event | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Contributions to premium/expense account | $ 667,000 | |||||||||
Class A Interests | Sun Life | White Eagle | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Payments for sale of life insurance contracts | $ 13,400,000 | |||||||||
Class A Interests | Revolving Credit Facility | CLMG | Palomino | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Purchase price of acquired equity interest | 374,200,000 | |||||||||
Proceeds from sale of limited partnership interest | 366,200,000 | |||||||||
Principal balance of proceeds | 406,000,000 | 392,600,000 | 392,600,000 | |||||||
Premium/expense reserve | $ 21,800,000 | |||||||||
Class D Interests | Affiliates | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Internal rate of return guaranteed to majority owner of partnership investment | 11.00% | |||||||||
Percentage of payment amount | 125.00% | |||||||||
Class D Interests | Affiliates | White Eagle | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Proceeds from sale of limited partnership interest | $ 8,000,000 | |||||||||
Class D Interests | Revolving Credit Facility | CLMG | Palomino | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Purchase price of acquired equity interest allocated to Class D | 8,000,000 | |||||||||
Annual amount guaranteed to majority owners of limited partnership | $ 2,000,000 | |||||||||
Internal rate of return guaranteed to majority owner of partnership investment | 11.00% | |||||||||
Premium/expense reserve | $ 8,000,000 | |||||||||
Premium/expense reserve distributions | 1,800,000 | |||||||||
Principal and interest payment amount allocated to Class D | $ 10,000,000 | 934,000 | 934,000 | |||||||
Principal amount allocated to Class D | 8,000,000 | 8,000,000 | ||||||||
Payments to limited partnership | 0 | |||||||||
Class B Interests | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Premium/expense reserve distributions | 2,000,000 | 6,000,000 | ||||||||
Class B Interests | Affiliates | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Period for distribution of proceeds from limited partnership interest | 8 years | |||||||||
Internal rate of return guaranteed to majority owner of partnership investment | 11.00% | |||||||||
Accrued and unpaid interest outstanding | $ 8,300,000 | $ 8,300,000 | ||||||||
Class B Interests | Affiliates | Third Anniversary | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Monthly distribution amount | $ 667,000 | |||||||||
Percentage of net assets value for monthly distribution from limited partners | 0.125% | |||||||||
Class B Interests | Affiliates | Tenth Anniversary | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Monthly distribution amount | $ 333,000 | |||||||||
Percentage of net assets value for monthly distribution from limited partners | 0.0625% | |||||||||
Class B Interests | Revolving Credit Facility | CLMG | Palomino | ||||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||||
Premium/expense reserve | $ 8,300,000 | |||||||||
[1] | Derived from audited consolidated financial statements. |
Investment in Limited Partner_4
Investment in Limited Partnership - Funds in the Premium/Expense Reserve Account (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | |
Investments in and Advances to Affiliates [Line Items] | ||||
Premiums and expenses | $ 30,289 | $ 8,210 | $ 85,241 | $ 8,210 |
Class B Interests | ||||
Investments in and Advances to Affiliates [Line Items] | ||||
Premiums and expenses | 2,000 | 6,000 | ||
First | ||||
Investments in and Advances to Affiliates [Line Items] | ||||
Premiums and expenses | 28,289 | 8,210 | 79,241 | 8,210 |
Second | Class B Interests | ||||
Investments in and Advances to Affiliates [Line Items] | ||||
Premiums and expenses | 2,000 | 0 | 6,000 | 0 |
Third | Class B Interests | ||||
Investments in and Advances to Affiliates [Line Items] | ||||
Premiums and expenses | 0 | 0 | 0 | 0 |
Fourth | ||||
Investments in and Advances to Affiliates [Line Items] | ||||
Premiums and expenses | $ 0 | $ 0 | $ 0 | $ 0 |
Investment in Limited Partner_5
Investment in Limited Partnership - Reconciliation of Premium/Expenses Reserve Account (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | |
Distributions And Payments Of Premium/Expenses From Reserve Account [Roll Forward] | ||||
Beginning balance | $ 22,224 | $ 4,195 | ||
Collections account | 34,188 | 117,138 | ||
Total distribution received | 34,200 | 107,200 | ||
Premiums and expenses | 30,289 | $ 8,210 | 85,241 | $ 8,210 |
Total payments | 30,289 | 85,241 | ||
Balance at August 31, 2020 | 26,123 | 21,800 | 26,123 | 21,800 |
Class B Interests | ||||
Distributions And Payments Of Premium/Expenses From Reserve Account [Roll Forward] | ||||
Premiums and expenses | 2,000 | 6,000 | ||
First | ||||
Distributions And Payments Of Premium/Expenses From Reserve Account [Roll Forward] | ||||
Collections account | 34,188 | 107,169 | ||
Total distribution received | 56,412 | 111,364 | ||
Premiums and expenses | $ 28,289 | $ 8,210 | $ 79,241 | $ 8,210 |
Investment in Limited Partner_6
Investment in Limited Partnership - Funds on Deposit in the Collection Account (Details) $ in Thousands | 3 Months Ended | 9 Months Ended |
Aug. 31, 2020USD ($) | Aug. 31, 2020USD ($) | |
Investments in and Advances to Affiliates [Line Items] | ||
Collections account | $ 34,188 | $ 117,138 |
First | ||
Investments in and Advances to Affiliates [Line Items] | ||
Collections account | 34,188 | 107,169 |
Second | Class A Interests | ||
Investments in and Advances to Affiliates [Line Items] | ||
Collections account | $ 0 | $ 9,969 |
Internal rate of return guaranteed to majority owner of partnership investment | 11.00% | 11.00% |
Principal balance of proceeds | $ 406,000 | $ 406,000 |
Third | Class B Interests | ||
Investments in and Advances to Affiliates [Line Items] | ||
Collections account | 0 | 0 |
Fourth | ||
Investments in and Advances to Affiliates [Line Items] | ||
Collections account | $ 0 | $ 0 |
Fourth | Class A Interests | ||
Investments in and Advances to Affiliates [Line Items] | ||
Percentage of equity interest sold | 72.50% | 72.50% |
Fourth | Class B Interests | ||
Investments in and Advances to Affiliates [Line Items] | ||
Equity investment ownership percentage | 27.50% | 27.50% |
Fifth | ||
Investments in and Advances to Affiliates [Line Items] | ||
Collections account | $ 0 | $ 0 |
Fifth | Class A Interests | ||
Investments in and Advances to Affiliates [Line Items] | ||
Percentage of equity interest sold | 72.50% | 72.50% |
Fifth | Class B Interests | ||
Investments in and Advances to Affiliates [Line Items] | ||
Equity investment ownership percentage | 27.50% | 27.50% |
Investment in Limited Partner_7
Investment in Limited Partnership - Reconciliation of Funds Received And Distributions From Collection Account (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Aug. 31, 2020 | Aug. 31, 2020 | |
Funds Received And Distributions Paid From Collection Account [Roll Forward] | ||
Beginning balance | $ 5,643 | $ 13,007 |
Maturity proceeds received - face | 32,050 | 107,276 |
Proceeds received - other* | 272 | 632 |
Total receipts | 37,965 | 120,915 |
Collections account | 34,188 | 117,138 |
Balance at August 31, 2020 | 3,777 | 3,777 |
First | ||
Funds Received And Distributions Paid From Collection Account [Roll Forward] | ||
Collections account | 34,188 | 107,169 |
Second | Class A Interests | ||
Funds Received And Distributions Paid From Collection Account [Roll Forward] | ||
Collections account | $ 0 | $ 9,969 |
Investment in Limited Partner_8
Investment in Limited Partnership - Reconciliation of Receivable For Maturity of Life Settlements (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Aug. 31, 2020 | Aug. 31, 2020 | |
Receivable From Maturity Of Life Settlement [Roll Forward] | ||
Balance at start | $ 28,550 | $ 13,726 |
Maturities | 43,225 | 133,275 |
Less: proceeds received | 32,050 | 107,276 |
Receivable at August 31, 2020 | $ 39,725 | $ 39,725 |
Investment in Limited Partner_9
Investment in Limited Partnership - Remaining Life Expectancy and Face Value of Life Settlements (Details) - WE Investment $ in Thousands | Aug. 31, 2020USD ($)contract |
Number of Life Settlement Contracts | |
0-1 | contract | 9 |
1-2 | contract | 30 |
2-3 | contract | 30 |
3-4 | contract | 54 |
4-5 | contract | 54 |
Thereafter | contract | 323 |
Total | contract | 500 |
Face Value | |
0-1 | $ | $ 40,780 |
1-2 | $ | 114,006 |
2-3 | $ | 121,696 |
3-4 | $ | 281,198 |
4-5 | $ | 253,239 |
Thereafter | $ | 1,556,622 |
Total | $ | $ 2,367,541 |
Investment in Limited Partne_10
Investment in Limited Partnership - Estimated Premiums to be Paid on Life Settlement Contracts (Details) - WE Investment $ in Thousands | Aug. 31, 2020USD ($) |
Investments in and Advances to Affiliates [Line Items] | |
2020 | $ 25,197 |
2021 | 104,768 |
2022 | 100,021 |
2023 | 93,316 |
2024 | 87,998 |
Thereafter | 572,074 |
Total | $ 983,374 |
White Eagle Revolving Credit _3
White Eagle Revolving Credit Facility - Narrative (Details) - USD ($) | Aug. 16, 2019 | Jul. 18, 2019 | Jan. 25, 2019 | Jan. 15, 2019 | Dec. 31, 2018 | Nov. 14, 2018 | Nov. 13, 2018 | Nov. 09, 2015 | Apr. 29, 2013 | May 31, 2019 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | Dec. 30, 2019 | Dec. 11, 2019 | Nov. 30, 2019 | Sep. 17, 2019 | Aug. 15, 2019 | Aug. 31, 2018 | Aug. 11, 2017 | Jul. 28, 2017 | Jul. 26, 2017 | Apr. 18, 2017 | Feb. 28, 2014 | |
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Investment in limited partnership | $ 152,450,000 | $ 137,849,000 | [1] | ||||||||||||||||||||||
8.5% Senior Secured Notes | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Debt issued | $ 5,000,000 | $ 30,000,000 | |||||||||||||||||||||||
Debt interest rate | 8.50% | 8.50% | 8.50% | 8.50% | [1] | 8.50% | |||||||||||||||||||
5.0% Convertible Notes | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Debt interest rate | 5.00% | 5.00% | 5.00% | 5.00% | [1] | 5.00% | |||||||||||||||||||
8.5% Convertible Notes | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Debt interest rate | 8.50% | 8.50% | 8.50% | ||||||||||||||||||||||
Senior Notes | 8.5% Senior Secured Notes | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Debt issued | $ 47,600,000 | ||||||||||||||||||||||||
Debt interest rate | 8.50% | ||||||||||||||||||||||||
Senior Notes | 5.0% Convertible Notes | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Debt issued | $ 75,800,000 | ||||||||||||||||||||||||
Debt interest rate | 5.00% | ||||||||||||||||||||||||
Convertible Notes | 5.0% Convertible Notes | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Debt interest rate | 5.00% | ||||||||||||||||||||||||
Convertible Notes | 8.5% Convertible Notes | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Debt issued | $ 1,200,000 | $ 74,200,000 | $ 70,700,000 | ||||||||||||||||||||||
Debt interest rate | 8.50% | 8.50% | |||||||||||||||||||||||
White Eagle | Subsidiaries | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Equity investment ownership percentage | 27.50% | ||||||||||||||||||||||||
LNV | DIP Financing | Subsidiaries | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Equity stake percentage | 45.00% | ||||||||||||||||||||||||
White Eagle | Affiliates | Class A Interests | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Proceeds from sale of limited partnership interest | $ 366,200,000 | ||||||||||||||||||||||||
White Eagle | Affiliates | Class D Interests | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Proceeds from sale of limited partnership interest | $ 8,000,000 | ||||||||||||||||||||||||
White Eagle | Palomino | Affiliates | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Percentage of equity interest sold | 72.50% | ||||||||||||||||||||||||
Exchange price on sale of equity interest in subsidiary | $ 384,300,000 | ||||||||||||||||||||||||
White Eagle | LNV | DIP Financing | Subsidiaries | If paid by September 17, 2019 | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Default rate of outstanding principal and accrued interest | 102.00% | ||||||||||||||||||||||||
White Eagle | LNV | DIP Financing | Subsidiaries | If paid by December 30, 2019 | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Default rate of outstanding principal and accrued interest | 104.00% | ||||||||||||||||||||||||
WEGP | LNV | DIP Financing | Subsidiaries | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Debtor-in-possession financing | $ 15,000,000 | ||||||||||||||||||||||||
WEGP | WEGP | General Partner | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Ownership interest percentage | 0.01% | ||||||||||||||||||||||||
WEGP | WEGP | Subsidiaries | General Partner | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Ownership interest percentage | 0.01% | 0.01% | |||||||||||||||||||||||
Lamington | White Eagle | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Equity investment ownership percentage | 27.50% | ||||||||||||||||||||||||
Investment in limited partnership | $ 138,900,000 | $ 152,500,000 | $ 137,800,000 | ||||||||||||||||||||||
Lamington | White Eagle | Policies pledged | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Equity investment ownership percentage | 27.50% | ||||||||||||||||||||||||
Lamington | White Eagle | Subsidiaries | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Equity investment ownership percentage | 27.50% | ||||||||||||||||||||||||
Lamington | White Eagle | Limited Partner | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Ownership interest percentage | 99.99% | ||||||||||||||||||||||||
Lamington | White Eagle | Subsidiaries | Limited Partner | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Ownership interest percentage | 99.99% | 99.99% | |||||||||||||||||||||||
LNV | Subsidiaries | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Equity stake percentage | 45.00% | ||||||||||||||||||||||||
LNV | DIP Financing | Subsidiaries | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Amount of debt committed to in connection with receiving an equity stake percentage | $ 370,000,000 | ||||||||||||||||||||||||
Revolving Credit Facility | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Repayment of outstanding principal on line of credit | $ 368,000,000 | ||||||||||||||||||||||||
Repayment of accrued and unpaid interest on line of credit | 21,300,000 | ||||||||||||||||||||||||
Revolving Credit Facility | White Eagle Asset Portfolio, LLC | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Percent of face amount pledged as collateral | 50.00% | ||||||||||||||||||||||||
Cash interest coverage ratio required, minimum | 2 | ||||||||||||||||||||||||
Revolving Credit Facility | White Eagle Asset Portfolio, LLC | After June 30, 2019 | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Cash interest coverage ratio required, minimum | 1.75 | ||||||||||||||||||||||||
Cash interest coverage ratio required number of consecutive days | 60 days | ||||||||||||||||||||||||
Revolving Credit Facility | CLMG | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Line of credit payoff | 402,500,000 | ||||||||||||||||||||||||
Revolving Credit Facility | LNV | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Early repayments of line of credit | 7,400,000 | ||||||||||||||||||||||||
Lender-allowed claims | 5,800,000 | ||||||||||||||||||||||||
Revolving Credit Facility | White Eagle | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Revolving credit facility effective date | Apr. 29, 2013 | ||||||||||||||||||||||||
Revolving credit facility period | 15 years | ||||||||||||||||||||||||
Cash interest coverage ratio required, minimum | 2 | ||||||||||||||||||||||||
Cash sweep percentage required | 100.00% | ||||||||||||||||||||||||
Collateral pledge percentage for distributions to be altered (as percent) | 25.00% | ||||||||||||||||||||||||
Base rate (as percent) | 0.50% | ||||||||||||||||||||||||
Debt instrument effective rate (as percent) | 9.51% | 6.61% | |||||||||||||||||||||||
Interest paid | $ 23,300,000 | $ 28,300,000 | |||||||||||||||||||||||
Credit agreement expiration date | Dec. 31, 2031 | ||||||||||||||||||||||||
Period during which debtors are authorized to use proceeds from pre-petition cash collateral (equivalent to 20 weeks) | 5 months | 2 months 7 days | |||||||||||||||||||||||
Revolving Credit Facility | White Eagle | LIBOR | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate (as percent) | 4.00% | 4.50% | |||||||||||||||||||||||
Revolving Credit Facility | White Eagle | Federal Funds Rate | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate (as percent) | 0.75% | ||||||||||||||||||||||||
Revolving Credit Facility | White Eagle | Floor Rate | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate (as percent) | 3.01% | 2.11% | |||||||||||||||||||||||
Revolving Credit Facility | White Eagle | Base Rate | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Debt instrument, basis spread over variable rate in event of default | 1.50% | ||||||||||||||||||||||||
Debt instrument, additional percentage over spread on variable rate in event of default | 6.50% | ||||||||||||||||||||||||
Revolving Credit Facility | White Eagle | Maintenance costs | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Line of credit borrowing base percentage | 100.00% | ||||||||||||||||||||||||
Revolving Credit Facility | White Eagle | Accrued and Unpaid Interest | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Line of credit borrowing base percentage | 100.00% | ||||||||||||||||||||||||
Revolving Credit Facility | White Eagle | Policies pledged as collateral as determined by the lenders | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Line of credit borrowing base percentage | 75.00% | ||||||||||||||||||||||||
Revolving Credit Facility | White Eagle | Minimum | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Line of credit, loan to value ratio (as percent) | 45.00% | ||||||||||||||||||||||||
Revolving Credit Facility | White Eagle | Minimum | LIBOR | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate (as percent) | 1.50% | ||||||||||||||||||||||||
Revolving Credit Facility | White Eagle | Policies pledged | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Revolving credit facility, current borrowing capacity | $ 370,000,000 | ||||||||||||||||||||||||
Revolving Credit Facility | White Eagle | CLMG | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Line of credit payoff | 28,300,000 | ||||||||||||||||||||||||
Revolving Credit Facility | Palomino | CLMG | Class A Interests | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Proceeds from sale of limited partnership interest | 366,200,000 | ||||||||||||||||||||||||
Purchase price of acquired equity interest | $ 374,200,000 | ||||||||||||||||||||||||
[1] | Derived from audited consolidated financial statements. |
White Eagle Revolving Credit _4
White Eagle Revolving Credit Facility - Payouts based on LTV (Details) | 9 Months Ended |
Aug. 31, 2020 | |
Lender | |
Debt Instrument [Line Items] | |
Distribution to White Eagle - 55%, Lender Participation - 45% | 45.00% |
White Eagle | |
Debt Instrument [Line Items] | |
Distribution to White Eagle - 55%, Lender Participation - 45% | 55.00% |
Revolving Credit Facility | White Eagle | Minimum | |
Debt Instrument [Line Items] | |
LTV | 45.00% |
White Eagle Amendment | Revolving Credit Facility | LTV N/A | |
Debt Instrument [Line Items] | |
Premiums, Interest & Other Fees | 100.00% |
Principal | 0.00% |
White Eagle Amendment | Revolving Credit Facility | LTV greater than 65% | |
Debt Instrument [Line Items] | |
Principal | 100.00% |
White Eagle Amendment | Revolving Credit Facility | LTV 50-65% | |
Debt Instrument [Line Items] | |
Principal | 70.00% |
White Eagle Amendment | Revolving Credit Facility | LTV 35-50% | |
Debt Instrument [Line Items] | |
Principal | 55.00% |
White Eagle Amendment | Revolving Credit Facility | LTV 0-35% | |
Debt Instrument [Line Items] | |
Principal | 45.00% |
White Eagle Amendment | Revolving Credit Facility | Lender | LTV N/A | |
Debt Instrument [Line Items] | |
Collections from policy proceeds percentage | 0.00% |
White Eagle Amendment | Revolving Credit Facility | Lender | LTV greater than 65% | |
Debt Instrument [Line Items] | |
Collections from policy proceeds percentage | 0.00% |
White Eagle Amendment | Revolving Credit Facility | Lender | LTV 50-65% | |
Debt Instrument [Line Items] | |
Collections from policy proceeds percentage | 13.50% |
White Eagle Amendment | Revolving Credit Facility | Lender | LTV 35-50% | |
Debt Instrument [Line Items] | |
Collections from policy proceeds percentage | 20.30% |
White Eagle Amendment | Revolving Credit Facility | Lender | LTV 0-35% | |
Debt Instrument [Line Items] | |
Collections from policy proceeds percentage | 24.80% |
White Eagle Amendment | Revolving Credit Facility | White Eagle | LTV N/A | |
Debt Instrument [Line Items] | |
Collections from policy proceeds percentage | 0.00% |
White Eagle Amendment | Revolving Credit Facility | White Eagle | LTV greater than 65% | |
Debt Instrument [Line Items] | |
Collections from policy proceeds percentage | 0.00% |
White Eagle Amendment | Revolving Credit Facility | White Eagle | LTV greater than 65% | Minimum | |
Debt Instrument [Line Items] | |
LTV | 65.00% |
White Eagle Amendment | Revolving Credit Facility | White Eagle | LTV 50-65% | |
Debt Instrument [Line Items] | |
Collections from policy proceeds percentage | 16.50% |
White Eagle Amendment | Revolving Credit Facility | White Eagle | LTV 50-65% | Minimum | |
Debt Instrument [Line Items] | |
LTV | 50.00% |
White Eagle Amendment | Revolving Credit Facility | White Eagle | LTV 50-65% | Maximum | |
Debt Instrument [Line Items] | |
LTV | 65.00% |
White Eagle Amendment | Revolving Credit Facility | White Eagle | LTV 35-50% | |
Debt Instrument [Line Items] | |
Collections from policy proceeds percentage | 24.80% |
White Eagle Amendment | Revolving Credit Facility | White Eagle | LTV 35-50% | Minimum | |
Debt Instrument [Line Items] | |
LTV | 35.00% |
White Eagle Amendment | Revolving Credit Facility | White Eagle | LTV 35-50% | Maximum | |
Debt Instrument [Line Items] | |
LTV | 50.00% |
White Eagle Amendment | Revolving Credit Facility | White Eagle | LTV 0-35% | |
Debt Instrument [Line Items] | |
Collections from policy proceeds percentage | 30.30% |
White Eagle Amendment | Revolving Credit Facility | White Eagle | LTV 0-35% | Minimum | |
Debt Instrument [Line Items] | |
LTV | 0.00% |
White Eagle Amendment | Revolving Credit Facility | White Eagle | LTV 0-35% | Maximum | |
Debt Instrument [Line Items] | |
LTV | 35.00% |
White Eagle Revolving Credit _5
White Eagle Revolving Credit Facility - Reconciliation of Proceeds Distributed (Details) - White Eagle - Revolving Credit Facility $ in Thousands | 9 Months Ended |
Aug. 16, 2019USD ($) | |
Reconciliation of Proceeds | |
Collection account balance at December 1, 2018 | $ 28,059 |
Face value collected in current quarter | 60,163 |
Face value collected in prior quarters | 32,342 |
Other collections | 2,575 |
Face value collected | 123,139 |
Expenses paid from the collection account Post-Petition | |
Premiums paid 2019 | (65,905) |
Interest expenses | (28,331) |
Payment toward principal | (1,804) |
White Eagle credit facility expenses | (9,304) |
Refund of premium payments advanced by parent | (3,000) |
Lender allowed claim-Beal | (5,839) |
Transfers of remaining funds to Lamington | (8,956) |
Total expenses paid from the collection account Post-Petition | (123,139) |
Collection account balance at August 16, 2019 | $ 0 |
White Eagle Revolving Credit _6
White Eagle Revolving Credit Facility - Advances For Premium Payments and Fees (Details) - White Eagle - Revolving Credit Facility - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Aug. 31, 2019 | Aug. 31, 2019 | |
Debt Instrument [Line Items] | ||
Amount drawn for premium payments | $ 0 | $ 4,221 |
Total amount drawn | $ 0 | $ 4,221 |
8.50% Senior Unsecured Conver_2
8.50% Senior Unsecured Convertible Notes (Details) - USD ($) $ in Thousands | Dec. 11, 2019 | Aug. 28, 2019 | Feb. 15, 2019 | Jul. 28, 2017 | Jul. 26, 2017 | Feb. 21, 2014 | Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | Nov. 30, 2019 | [1] | Apr. 18, 2017 | Mar. 14, 2017 | Feb. 28, 2014 |
Debt Instrument [Line Items] | |||||||||||||||
Interest paid in kind on 8.5% Senior Secured Notes | $ 0 | $ 2,842 | |||||||||||||
Interest included in interest expense | $ 73 | ||||||||||||||
8.5% Convertible Notes | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Stated interest rate percentage | 8.50% | 8.50% | 8.50% | 8.50% | |||||||||||
5.0% Convertible Notes | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Stated interest rate percentage | 5.00% | 5.00% | 5.00% | 5.00% | 5.00% | 5.00% | |||||||||
Convertible Notes | 8.5% Convertible Notes | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Debt issued | $ 74,200 | $ 1,200 | $ 1,200 | $ 70,700 | |||||||||||
Stated interest rate percentage | 8.50% | 8.50% | 8.50% | ||||||||||||
Debt instrument, issuance date | Feb. 21, 2014 | ||||||||||||||
Debt instrument, maturity date | Feb. 15, 2019 | ||||||||||||||
Debt instrument, frequency of periodic payment | semi-annually in arrears on August 15 and February 15 of each year | ||||||||||||||
Outstanding principal balance | $ 73,000 | ||||||||||||||
Interest paid in kind on 8.5% Senior Secured Notes | $ 2,800 | ||||||||||||||
Debt repurchased | $ 1,200 | ||||||||||||||
Debt accrued and unpaid interest payment | 110 | ||||||||||||||
Debt administrative fees and expenses paid | $ 38 | ||||||||||||||
Interest expense debt | $ 22 | $ 93 | |||||||||||||
Amortization of debt discounts | 18 | ||||||||||||||
Amortization of debt origination costs | 3 | ||||||||||||||
Convertible Notes | Additional 8.50% Convertible Notes | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Debt issued | $ 3,500 | ||||||||||||||
Convertible Notes | 5.0% Convertible Notes | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Stated interest rate percentage | 5.00% | ||||||||||||||
Percentage of holders tendering exchange offer, minimum (as percent) | 98.00% | ||||||||||||||
Debt repurchased | $ 8,000 | ||||||||||||||
Debt accrued and unpaid interest payment | $ 123 | ||||||||||||||
Interest expense debt | $ 1,200 | 1,300 | $ 3,400 | 3,800 | |||||||||||
Interest included in interest expense | 848 | 948 | 2,600 | 2,800 | |||||||||||
Amortization of debt discounts | 282 | 290 | 776 | 832 | |||||||||||
Amortization of debt origination costs | $ 42 | $ 43 | $ 115 | $ 123 | |||||||||||
[1] | Derived from audited consolidated financial statements. |
5.0% Senior Unsecured Convert_2
5.0% Senior Unsecured Convertible Notes (Details) | Dec. 11, 2019USD ($) | Jul. 28, 2017USD ($)d$ / shares | Jul. 26, 2017 | Aug. 31, 2020USD ($) | Aug. 31, 2019USD ($) | Aug. 31, 2020USD ($) | Aug. 31, 2019USD ($) | Nov. 30, 2019USD ($) | [1] | Dec. 10, 2018USD ($) | Apr. 18, 2017 |
Debt Instrument [Line Items] | |||||||||||
Repayment of convertible debt | $ 4,677,000 | $ 1,194,000 | |||||||||
Gain on extinguishment of debt | $ 0 | $ 0 | $ 2,815,000 | 0 | |||||||
Interest included in interest expense | $ 73,000 | ||||||||||
5.0% Convertible Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Stated interest rate percentage | 5.00% | 5.00% | 5.00% | 5.00% | 5.00% | 5.00% | |||||
Convertible notes, net of discount | $ 64,420,000 | $ 64,420,000 | $ 71,022,000 | ||||||||
New Convertible Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt issued | $ 40,000,000 | $ 70,000,000 | |||||||||
Convertible Notes | 5.0% Convertible Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Percentage of holders tendering exchange offer, minimum (as percent) | 98.00% | ||||||||||
Stated interest rate percentage | 5.00% | ||||||||||
Debt repurchased | $ 8,000,000 | ||||||||||
Repayment of convertible debt | 4,800,000 | ||||||||||
Debt accrued and unpaid interest payment | 123,000 | ||||||||||
Gain on extinguishment of debt | 2,800,000 | ||||||||||
Debt expense for derivative | 442,000 | ||||||||||
Write off debt origination costs | $ 66,000 | ||||||||||
Carrying value of debt | 67,800,000 | 67,800,000 | |||||||||
Convertible notes, net of discount | 64,400,000 | 64,400,000 | |||||||||
Debt unamortized discount | 3,000,000 | 3,000,000 | |||||||||
Debt unamortized issuance cost | 441,000 | 441,000 | |||||||||
Interest expense debt | 1,200,000 | $ 1,300,000 | 3,400,000 | $ 3,800,000 | |||||||
Interest included in interest expense | 848,000 | 948,000 | 2,600,000 | 2,800,000 | |||||||
Amortization of debt discounts | 282,000 | 290,000 | 776,000 | 832,000 | |||||||
Amortization of debt origination costs | $ 42,000 | $ 43,000 | $ 115,000 | $ 123,000 | |||||||
Convertible Notes | New Convertible Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt issued | $ 75,800,000 | ||||||||||
Debt instrument, conversion price (in dollars per share) | $ / shares | $ 2 | ||||||||||
Debt instrument, conversion rate | 0.5 | ||||||||||
Debt instrument, redemption price, percentage | 100.00% | ||||||||||
Debt instrument, convertible, minimum percentage of common stock price (as percent) | 120.00% | ||||||||||
Debt instrument, convertible, threshold trading days | d | 15 | ||||||||||
Debt instrument, convertible, threshold consecutive trading days | d | 30 | ||||||||||
Debt instrument, required percentage of trustees or holders to declare notes immediately due and payable | 25.00% | ||||||||||
Debt instrument, required percentage of principal for each day of default | 0.25% | ||||||||||
Debt instrument, additional required percentage of principal for each day of restricted transfer default | 0.25% | ||||||||||
Debt instrument, maximum required percentage of principal restricted transfer default | 0.50% | ||||||||||
Debt instrument, debt default, special interest percentage of principal | 0.50% | ||||||||||
[1] | Derived from audited consolidated financial statements. |
8.5% Senior Secured Notes (Deta
8.5% Senior Secured Notes (Details) - USD ($) | Aug. 14, 2017 | Aug. 11, 2017 | Jul. 28, 2017 | Aug. 31, 2017 | Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | Nov. 30, 2019 | Feb. 11, 2019 | Jan. 30, 2019 | Dec. 28, 2018 | Dec. 10, 2018 | Jan. 10, 2018 | Dec. 29, 2016 | |
Debt Instrument [Line Items] | ||||||||||||||||
Interest included in interest expense | $ 73,000 | |||||||||||||||
Stock Purchase Agreement | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Sale of stock, price per share (in dollars per share) | $ 0.20 | |||||||||||||||
Sale of stock, number of shares issued (in shares) | 115,000,000 | |||||||||||||||
Brennan | Stock Purchase Agreement | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Securities remaining for future issuance (in shares) | 12,500,000 | 12,500,000 | ||||||||||||||
Sale of stock, price per share (in dollars per share) | $ 0.40 | $ 0.40 | ||||||||||||||
Sale of stock, aggregate purchase price | $ 5,000,000 | $ 5,000,000 | ||||||||||||||
Sale of stock, number of shares issued (in shares) | 3,750,000 | 8,750,000 | ||||||||||||||
8.5% Senior Secured Notes | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Debt interest rate | 8.50% | 8.50% | 8.50% | 8.50% | 8.50% | 8.50% | [1] | |||||||||
Debt issued | $ 5,000,000 | $ 30,000,000 | ||||||||||||||
Debt repurchase amount | $ 24,500,000 | $ 1,500,000 | $ 4,300,000 | |||||||||||||
Debt repurchased | $ 2,000,000 | 5,700,000 | ||||||||||||||
Additional interest rate percentage to be paid to holders who accept interest paid-in-kind interest | 3.00% | |||||||||||||||
Senior notes, net | $ 46,491,000 | $ 46,491,000 | $ 45,675,000 | [1] | ||||||||||||
8.5% Senior Secured Notes | Board of Directors Member | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Debt repurchase amount | 1,500,000 | |||||||||||||||
Debt repurchased | $ 2,000,000 | |||||||||||||||
8.5% Senior Secured Notes | Brennan | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Debt repurchase amount | $ 967,000 | |||||||||||||||
Debt repurchased | $ 725,000 | |||||||||||||||
Brennan Notes | Brennan | Stock Purchase Agreement | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Debt repurchased | $ 1,500,000 | $ 3,500,000 | ||||||||||||||
15.0% Senior Secured Notes | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Debt interest rate | 15.00% | |||||||||||||||
New Convertible Notes | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Debt issued | $ 40,000,000 | $ 70,000,000 | ||||||||||||||
Paid-in-kind interest payable | 26,800,000 | |||||||||||||||
Paid-in-kind interest payable in cash | $ 8,200,000 | |||||||||||||||
Additional debt issuance | $ 4,000,000 | |||||||||||||||
Senior Secured Notes | New Senior Secured Notes | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Percentage of senior debt to be purchased, maximum | 100.00% | |||||||||||||||
Senior Secured Notes | 8.5% Senior Secured Notes | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Debt interest rate | 8.50% | 8.50% | ||||||||||||||
Debt issued | $ 47,600,000 | $ 47,600,000 | ||||||||||||||
Debt outstanding principal balance | 47,600,000 | 47,600,000 | ||||||||||||||
Senior notes, net | 46,500,000 | 46,500,000 | ||||||||||||||
Debt unamortized discount | 904,000 | 904,000 | ||||||||||||||
Unamortized debt issuance costs | 205,000 | 205,000 | ||||||||||||||
Interest expense debt | 1,600,000 | $ 1,500,000 | 4,200,000 | $ 4,400,000 | ||||||||||||
Interest included in interest expense | 1,300,000 | 1,300,000 | 3,300,000 | 3,800,000 | ||||||||||||
Amortization of debt origination costs | 54,000 | 76,000 | 156,000 | 209,000 | ||||||||||||
Amortization of debt discounts | $ 231,000 | $ 152,000 | $ 660,000 | $ 346,000 | ||||||||||||
Senior Secured Notes | 15.0% Senior Secured Notes | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Debt issued | $ 69,600,000 | |||||||||||||||
Senior Secured Notes | 15.0% Senior Secured Notes | Change in control | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Debt instrument, redemption price, percentage | 107.50% | |||||||||||||||
Convertible Notes | New Convertible Notes | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Debt issued | $ 75,800,000 | |||||||||||||||
Debt instrument, redemption price, percentage | 100.00% | |||||||||||||||
Debt instrument, required percentage pledged to equity interest | 65.00% | |||||||||||||||
Debt covenant, percent of equity interests pledged as collateral | 65.00% | |||||||||||||||
Debt instrument, required percentage of trustees or holders to declare notes immediately due and payable | 25.00% | |||||||||||||||
[1] | Derived from audited consolidated financial statements. |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands | Aug. 31, 2020 | Nov. 30, 2019 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment in limited partnership | $ 152,450 | $ 137,849 | [1] |
Investment in life settlements | 1,297 | ||
Investment fair value | 152,450 | 139,146 | |
Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment in limited partnership | 0 | 0 | |
Investment in life settlements | 0 | ||
Investment fair value | 0 | 0 | |
Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment in limited partnership | 0 | 0 | |
Investment in life settlements | 0 | ||
Investment fair value | 0 | 0 | |
Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment in limited partnership | 152,450 | 137,849 | |
Investment in life settlements | 1,297 | ||
Investment fair value | $ 152,450 | $ 139,146 | |
[1] | Derived from audited consolidated financial statements. |
Fair Value Measurements - Quant
Fair Value Measurements - Quantitative Information about Level 3 Fair Value Measurements (Details) $ in Thousands | Aug. 31, 2020USD ($) | Nov. 30, 2019USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Investment in limited partnership | $ 152,450 | $ 137,849 | [1] |
Level 3 | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Investment in limited partnership | 152,450 | $ 137,849 | |
Investment in limited partnership aggregate death benefit | $ 663,033 | ||
Level 3 | Discounted cash flow | Discount rate | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Investment in limited partnership measurement input | 0.1404 | ||
[1] | Derived from audited consolidated financial statements. |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) $ in Thousands | Aug. 16, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | Aug. 16, 2019 | Nov. 30, 2019 | Nov. 30, 2018 | Jul. 28, 2017 | Apr. 18, 2017 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||
Investment in limited partnership | $ 152,450 | $ 152,450 | $ 137,849 | [1] | |||||||
Change in fair value of investment in deconsolidated subsidiaries (Notes 4 & 16) | 0 | $ 90,710 | 0 | $ 37,941 | |||||||
Level 3 | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||
Investment in limited partnership | $ 152,450 | $ 152,450 | $ 137,849 | ||||||||
8.5% Senior Secured Notes | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||
Debt interest rate | 8.50% | 8.50% | 8.50% | 8.50% | 8.50% | [1] | 8.50% | ||||
5.0% Convertible Notes | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||
Debt interest rate | 5.00% | 5.00% | 5.00% | 5.00% | 5.00% | [1] | 5.00% | ||||
WE Investment | Consolidated | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||
Equity investment ownership percentage | 27.50% | 27.50% | |||||||||
Class A Interests | Affiliates | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||
Internal rate of return guaranteed to majority owner of partnership investment | 11.00% | 11.00% | |||||||||
Class A Interests | For the first 3 years | Affiliates | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||
Proceeds from sale of limited partnership interest | $ 8,000 | ||||||||||
Period for distribution of proceeds from limited partnership interest | 3 years | ||||||||||
Class A Interests | For the subsequent 7 years | Affiliates | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||
Proceeds from sale of limited partnership interest | $ 4,000 | ||||||||||
Period for distribution of proceeds from limited partnership interest | 7 years | ||||||||||
Class D Interests | Affiliates | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||
Internal rate of return guaranteed to majority owner of partnership investment | 11.00% | 11.00% | |||||||||
Class B Interests | Affiliates | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||
Period for distribution of proceeds from limited partnership interest | 8 years | ||||||||||
Internal rate of return guaranteed to majority owner of partnership investment | 11.00% | 11.00% | |||||||||
Subsidiary in Bankruptcy Proceedings | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||
Investment in limited partnership | $ 166,736 | $ 166,736 | $ 128,795 | ||||||||
Change in fair value of investment in deconsolidated subsidiaries (Notes 4 & 16) | $ 37,941 | ||||||||||
Lamington | WE Investment | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||
Equity investment ownership percentage | 27.50% | 27.50% | |||||||||
Investment in limited partnership | $ 138,900 | $ 152,500 | $ 152,500 | $ 138,900 | $ 137,800 | ||||||
Lamington | WE Investment | Consolidated | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||
Equity investment ownership percentage | 27.50% | 27.50% | |||||||||
Lamington | Class B Interests | WE Investment | Consolidated | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||
Equity investment ownership percentage | 27.50% | 27.50% | |||||||||
White Eagle | WE Investment | Discount rate | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||
Investment in limited partnership measurement input | 0.1404 | 0.1404 | |||||||||
White Eagle | WE Investment | Consolidated | Discount rate | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||
Investment in limited partnership measurement input | 0.1404 | 0.1404 | |||||||||
White Eagle | Class A Interests | Affiliates | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||
Proceeds from sale of limited partnership interest | $ 366,200 | ||||||||||
White Eagle | Class D Interests | Affiliates | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||
Proceeds from sale of limited partnership interest | $ 8,000 | ||||||||||
Palomino | White Eagle | Affiliates | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||
Percentage of equity interest sold | 72.50% | 72.50% | |||||||||
[1] | Derived from audited consolidated financial statements. |
Fair Value Measurements - Disco
Fair Value Measurements - Discount Rate Used to Estimate Fair Value of Investment in Partnership (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Aug. 31, 2020USD ($) | Aug. 31, 2019USD ($) | Aug. 31, 2020USD ($) | Aug. 31, 2019USD ($) | Nov. 30, 2019USD ($) | [1] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Investment in limited partnership | $ 152,450 | $ 152,450 | $ 137,849 | |||
Change in Value | $ 4,250 | $ (5,821) | $ 20,601 | $ (5,821) | ||
Discount rate | 0.50% Decrease | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Weighted Average Rate | 0.1354 | 0.1354 | ||||
Investment in limited partnership | $ 156,438 | $ 156,438 | ||||
Change in Value | $ 3,988 | |||||
Discount rate | No Change | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Weighted Average Rate | 0.1404 | 0.1404 | ||||
Investment in limited partnership | $ 152,450 | $ 152,450 | ||||
Change in Value | $ 0 | |||||
Discount rate | 0.50% Increase | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Weighted Average Rate | 0.1454 | 0.1454 | ||||
Investment in limited partnership | $ 148,616 | $ 148,616 | ||||
Change in Value | $ (3,834) | |||||
[1] | Derived from audited consolidated financial statements. |
Fair Value Measurements - Chang
Fair Value Measurements - Changes in Fair Value for All Assets Using Material Level of Unobservable (Level 3) Inputs (Details) - Level 3 - USD ($) $ in Thousands | 9 Months Ended | |
Aug. 31, 2020 | Aug. 31, 2019 | |
Deconsolidated | Lamington | ||
Fair Value, Assets, Unobservable Input Reconciliation [Roll Forward] | ||
Beginning balance | $ 128,795 | |
Change in fair value | 37,941 | |
Transferred to consolidation | (166,736) | |
Ending balance | 0 | |
Investment in Limited Partnership | ||
Fair Value, Assets, Unobservable Input Reconciliation [Roll Forward] | ||
Beginning balance | $ 137,849 | |
Change in fair value | 20,601 | |
Distributions | (6,000) | |
Ending balance | 152,450 | |
Changes in fair value included in earnings for the period relating to assets held at the end of the period | 14,601 | |
Life Finance | Deconsolidated | ||
Fair Value, Assets, Unobservable Input Reconciliation [Roll Forward] | ||
Beginning balance | 505,235 | |
Sale of policies | (344,845) | |
Change in fair value | (16,841) | |
Premiums paid | 69,827 | |
Purchase of policies | 0 | |
Matured/lapsed/sold polices | (100,373) | |
Receivable for maturity of life settlement write off | 17,800 | |
Transfer to investment in limited partnership | (130,803) | |
Ending balance | 0 | |
Changes in fair value included in earnings for the period relating to assets held at the end of the period | 0 | |
Life Finance | Consolidated | ||
Fair Value, Assets, Unobservable Input Reconciliation [Roll Forward] | ||
Beginning balance | 1,297 | 1,172 |
Sale of policies | (2,040) | |
Gain on sale of life settlement | 743 | |
Change in fair value | 0 | (37) |
Premiums paid | 0 | 118 |
Purchase of policies | 0 | |
Matured/lapsed/sold polices | 0 | |
Ending balance | 0 | 1,253 |
Changes in fair value included in earnings for the period relating to assets held at the end of the period | $ 0 | $ (37) |
Fair Value Measurements - Cha_2
Fair Value Measurements - Changes in Fair Value for All Liabilities Using Material Level of Unobservable (Level 3) Inputs (Details) - Level 3 - Deconsolidated - Revolving Credit Facility - White Eagle $ in Thousands | 9 Months Ended |
Aug. 31, 2019USD ($) | |
Fair Value, Liabilities, Unobservable Input Reconciliation [Roll Forward] | |
Beginning balance | $ 346,670 |
Draws under the White Eagle Revolving Credit Facility | 4,221 |
Payments on White Eagle Revolving Credit Facility | (367,985) |
Unrealized change in fair value | 17,094 |
Ending balance | 0 |
Changes in fair value included in earnings for period relating to liabilities held at the end of the period | $ 0 |
Commitments and Contingencies (
Commitments and Contingencies (Details) | Jan. 29, 2020 | Jan. 27, 2020USD ($)shares | Dec. 10, 2019USD ($) | Dec. 04, 2019USD ($)contract | Nov. 12, 2019USD ($) | May 22, 2019USD ($)contractclaim | May 11, 2019USD ($) | Oct. 01, 2018USD ($) | Mar. 13, 2018USD ($) | Jul. 29, 2013USD ($) | Jun. 30, 2019USD ($) | Aug. 31, 2020USD ($) | Aug. 31, 2019USD ($) | Dec. 31, 2020USD ($) | Aug. 31, 2020USD ($) | Aug. 31, 2019USD ($) | Oct. 14, 2020numberOfRestructuringAgreements | Dec. 11, 2019 | Dec. 01, 2019USD ($) | Nov. 30, 2019USD ($) | Jul. 28, 2017 | Apr. 18, 2017 | Jan. 12, 2017appeal | Apr. 18, 2013policy | |
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Lease expiration date | Sep. 30, 2020 | ||||||||||||||||||||||||
Annual base rent | $ 268,000 | ||||||||||||||||||||||||
Percentage of annual increase of base rent | 3.00% | ||||||||||||||||||||||||
Operating lease assets | $ 22,000 | $ 22,000 | |||||||||||||||||||||||
Operating lease expense | 107,000 | 352,000 | |||||||||||||||||||||||
Rent expense under operating lease | $ 104,000 | $ 332,000 | |||||||||||||||||||||||
Sublease annual base rent | $ 89,000 | $ 78,000 | |||||||||||||||||||||||
Sublease income | 29,000 | 119,000 | |||||||||||||||||||||||
Sublease rental income | $ 41,000 | $ 117,000 | |||||||||||||||||||||||
Life settlement receivable | $ 0 | $ 0 | $ 1,297,000 | [1] | |||||||||||||||||||||
Investment in life settlements fair value | $ 1,297,000 | ||||||||||||||||||||||||
Proceeds from maturity of life settlements | $ 12,700,000 | ||||||||||||||||||||||||
8.5% Senior Secured Notes | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Debt interest rate | 8.50% | 8.50% | 8.50% | 8.50% | 8.50% | [1] | 8.50% | ||||||||||||||||||
5.0% Convertible Notes | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Debt interest rate | 5.00% | 5.00% | 5.00% | 5.00% | 5.00% | [1] | 5.00% | ||||||||||||||||||
Secured Notes | 8.5% Senior Secured Notes | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Debt interest rate | 8.50% | ||||||||||||||||||||||||
Convertible Notes | 5.0% Convertible Notes | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Debt interest rate | 5.00% | ||||||||||||||||||||||||
Subsequent Event | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Monthly base rent | $ 700 | ||||||||||||||||||||||||
Number of restructuring support agreements | numberOfRestructuringAgreements | 2 | ||||||||||||||||||||||||
Subsequent Event | Secured Notes | 8.5% Senior Secured Notes | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Debt interest rate | 8.50% | ||||||||||||||||||||||||
Subsequent Event | Convertible Notes | 5.0% Convertible Notes | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Debt interest rate | 5.00% | ||||||||||||||||||||||||
Pending Litigation | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Life insurance, policies issued | policy | 28 | ||||||||||||||||||||||||
Compensatory damages sought in addition to an award of punitive damages | $ 30,000,000 | ||||||||||||||||||||||||
Loss contingency, number of appeals | appeal | 2 | ||||||||||||||||||||||||
Lincoln Benefit Life Settlement | Settled Litigation | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Litigation settlement received | $ 21,300,000 | ||||||||||||||||||||||||
V.P. Chief Legal Officer and General Counsel | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Severance annual salary | $ 250,000 | ||||||||||||||||||||||||
Severance period | 6 months | ||||||||||||||||||||||||
Employee agreement term | 1 year | ||||||||||||||||||||||||
Employee agreement extension period | 1 year | ||||||||||||||||||||||||
Period to give written notice to terminate employment | 60 days | ||||||||||||||||||||||||
V.P. Chief Legal Officer and General Counsel | Mr. Werblowsky Severance Agreement | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Severance annual salary | $ 500,000 | ||||||||||||||||||||||||
Retention percentage payable upon employee entering into agreement | 66.00% | ||||||||||||||||||||||||
Retention percentage payable upon consummation of restructuring | 33.00% | ||||||||||||||||||||||||
V.P. Chief Investment Officer | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Severance annual salary | $ 275,000 | ||||||||||||||||||||||||
Severance period | 6 months | ||||||||||||||||||||||||
Employee agreement term | 1 year | ||||||||||||||||||||||||
Employee agreement extension period | 1 year | ||||||||||||||||||||||||
Period to give written notice to terminate employment | 60 days | ||||||||||||||||||||||||
V.P. Chief Investment Officer | Mr. Simony Severance Agreement | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Severance annual salary | $ 1,000,000 | ||||||||||||||||||||||||
Period covered by COBRA health insurance under employment agreement | 12 months | ||||||||||||||||||||||||
Retention percentage payable upon employee entering into agreement | 66.00% | 66.00% | |||||||||||||||||||||||
Retention percentage payable upon consummation of restructuring | 33.00% | 33.00% | |||||||||||||||||||||||
Period after consummation of restructuring | 3 days | ||||||||||||||||||||||||
Period after the amendment date | 7 days | ||||||||||||||||||||||||
V.P. Chief Investment Officer | Mr. Werblowsky Severance Agreement | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Period covered by COBRA health insurance under employment agreement | 12 months | ||||||||||||||||||||||||
Period after consummation of restructuring | 3 days | ||||||||||||||||||||||||
Cheif Financial Officer | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Severance annual salary | $ 352,229 | $ 352,229 | |||||||||||||||||||||||
Severance period | 12 months | ||||||||||||||||||||||||
Change in control period | 2 years | ||||||||||||||||||||||||
Base salary multiplier | 200.00% | ||||||||||||||||||||||||
Cheif Financial Officer | Ms. Martinez Severance Agreement | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Severance annual salary | $ 700,000 | ||||||||||||||||||||||||
Period covered by COBRA health insurance under employment agreement | 18 months | ||||||||||||||||||||||||
Retention percentage payable upon employee entering into agreement | 66.00% | ||||||||||||||||||||||||
Retention percentage payable upon consummation of restructuring | 33.00% | ||||||||||||||||||||||||
Period after consummation of restructuring | 3 days | ||||||||||||||||||||||||
Chief Executive Officer | Mr. Curry Bonus | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Period after consummation of restructuring | 30 days | ||||||||||||||||||||||||
Period after approval of restructuring | 45 days | ||||||||||||||||||||||||
White Eagle | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Number of life insurance policies canceled | contract | 2 | ||||||||||||||||||||||||
Proceeds from maturity of life settlements | $ 2,000,000 | ||||||||||||||||||||||||
White Eagle | Lincoln Benefit Life Settlement | Settled Litigation | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Number of policies owned | contract | 55 | ||||||||||||||||||||||||
White Eagle | Allstate Life Insurance Company Settlement | Settled Litigation | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Litigation settlement paid | $ 2,000,000 | ||||||||||||||||||||||||
Number of separate legal actions | claim | 6 | ||||||||||||||||||||||||
Life settlement receivable | $ 39,100,000 | ||||||||||||||||||||||||
Receivable for maturity of life settlement write off | $ 17,800,000 | ||||||||||||||||||||||||
Proceeds from legal settlement | $ 2,000,000 | ||||||||||||||||||||||||
Sun Life | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Number of life insurance policies canceled | contract | 31 | ||||||||||||||||||||||||
Investment in life settlements fair value | $ 163,500,000 | ||||||||||||||||||||||||
Proceeds from maturity of life settlements | $ 36,100,000 | ||||||||||||||||||||||||
Sun Life | Emergent Capital, Inc. | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Number of life insurance policies canceled | contract | 2 | ||||||||||||||||||||||||
Investment in life settlements fair value | $ 12,000,000 | ||||||||||||||||||||||||
Proceeds from maturity of life settlements | 12,700,000 | ||||||||||||||||||||||||
Sun Life | Wilmington Trust | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Payments for maturity of life insurance policies | $ 10,000,000 | ||||||||||||||||||||||||
Sun Life | White Eagle | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Number of policies owned | contract | 28 | ||||||||||||||||||||||||
Investment in life settlements fair value | $ 141,500,000 | ||||||||||||||||||||||||
Number of life insurance policies in receivable for maturity | contract | 1 | ||||||||||||||||||||||||
Receivable for maturity of life insurance policies | $ 10,000,000 | ||||||||||||||||||||||||
Payments for maturity of life insurance policies | $ 13,400,000 | ||||||||||||||||||||||||
Payable after the grant | Chief Executive Officer | Mr. Curry Bonus | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Bonus payable in cash | $ 400,000 | ||||||||||||||||||||||||
Payable upon consummation of Restructuring | Chief Executive Officer | Mr. Curry Bonus | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Bonus payable in cash | 300,000 | ||||||||||||||||||||||||
Payable if the Company effects the Restructuring | Chief Executive Officer | Mr. Curry Bonus | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Bonus payable in cash | 300,000 | ||||||||||||||||||||||||
Payable under the approved Restructuring budget (at least) | Chief Executive Officer | Mr. Curry Bonus | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Bonus payable in cash | $ 600,000 | ||||||||||||||||||||||||
Restricted Stock | Chief Executive Officer | Mr. Curry Bonus | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Bonus stock awards reserved for issuance (in shares) | shares | 1,000,000 | ||||||||||||||||||||||||
Restricted Stock | First anniversary of the grant date | Chief Executive Officer | Mr. Curry Bonus | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Bonus awards vesting percentage | 33.33% | ||||||||||||||||||||||||
Restricted Stock | Second anniversary of the grant date | Chief Executive Officer | Mr. Curry Bonus | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Bonus awards vesting percentage | 33.33% | ||||||||||||||||||||||||
Restricted Stock | Third anniversary of the grant date | Chief Executive Officer | Mr. Curry Bonus | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Bonus awards vesting percentage | 33.33% | ||||||||||||||||||||||||
ASU 2016-02 | |||||||||||||||||||||||||
Commitments and Contingencies [Line Items] | |||||||||||||||||||||||||
Operating lease liability | $ 203,000 | ||||||||||||||||||||||||
Operating lease assets | $ 179,000 | ||||||||||||||||||||||||
[1] | Derived from audited consolidated financial statements. |
Stockholders' Deficit_Equity (D
Stockholders' Deficit/Equity (Details) | Aug. 14, 2017shares | Aug. 11, 2017USD ($)$ / sharesshares | Jul. 28, 2017USD ($)director$ / sharesshares | Sep. 01, 2015USD ($) | Aug. 31, 2017USD ($)$ / sharesshares | Aug. 31, 2020USD ($)$ / sharesshares | Dec. 31, 2015USD ($)$ / sharesshares | Nov. 30, 2019USD ($)$ / sharesshares | Jul. 17, 2017shares | Jul. 16, 2017shares | |
Stockholders Equity [Line Items] | |||||||||||
Stock options granted (in shares) | 0 | ||||||||||
Stock options outstanding (in shares) | 0 | 85,000 | |||||||||
Share and note repurchase program, authorized amount | $ | $ 10,000,000 | ||||||||||
Stock repurchase program, term of plan | 2 years | ||||||||||
Shares purchased (in shares) | 608,000 | ||||||||||
Cost of shares purchased | $ | $ 2,534,000 | $ 2,500,000 | $ 2,534,000 | [1] | |||||||
Average cost per share purchased (in dollars per share) | $ / shares | $ 4.17 | ||||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | [1] | ||||||||
Common stock, shares authorized (in shares) | 415,000,000 | 415,000,000 | [1] | 415,000,000 | 80,000,000 | ||||||
Number of board of directors | director | 7 | ||||||||||
Common Stock Purchase Agreement | |||||||||||
Stockholders Equity [Line Items] | |||||||||||
Sale of stock, number of shares issued (in shares) | 115,000,000 | ||||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | ||||||||||
Sale of stock, price per share (in dollars per share) | $ / shares | $ 0.20 | ||||||||||
Common stock issued value | $ | $ 23,000,000 | ||||||||||
Immediately Upon Issuance | Convertible Notes | |||||||||||
Stockholders Equity [Line Items] | |||||||||||
Warrants issued (in shares) | 17,500,000 | ||||||||||
At Later Times After Conversion of Notes | Convertible Notes | |||||||||||
Stockholders Equity [Line Items] | |||||||||||
Warrants issued (in shares) | 25,000,000 | ||||||||||
Warrant Investors | |||||||||||
Stockholders Equity [Line Items] | |||||||||||
Warrants issued (in shares) | 42,500,000 | ||||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.20 | ||||||||||
Term of warrants | 8 years | ||||||||||
PJC, Triax and Other Affiliates | |||||||||||
Stockholders Equity [Line Items] | |||||||||||
Warrants issued (in shares) | 27,150,000 | ||||||||||
Sale of stock, number of shares issued (in shares) | 39,320,038 | ||||||||||
PJC, Triax and Other Affiliates | Emergent Capital, Inc. | |||||||||||
Stockholders Equity [Line Items] | |||||||||||
Percentage of ownership after sale of stocks (as percent) | 38.90% | ||||||||||
PJC, Triax and Other Affiliates | Common Stock Purchase Agreement | |||||||||||
Stockholders Equity [Line Items] | |||||||||||
Sale of stock, number of shares issued (in shares) | 75,000,000 | ||||||||||
Common stock issued value | $ | $ 15,000,000 | ||||||||||
Convertible Notes Holders Investors | Common Stock Purchase Agreement | |||||||||||
Stockholders Equity [Line Items] | |||||||||||
Sale of stock, number of shares issued (in shares) | 40,000,000 | ||||||||||
Common stock issued value | $ | $ 8,000,000 | ||||||||||
PJC Investments, LLC | Common Stock Purchase Agreement | |||||||||||
Stockholders Equity [Line Items] | |||||||||||
Sale of stock, number of shares issued (in shares) | 19,320,038 | ||||||||||
Brennan | Common Stock Purchase Agreement | |||||||||||
Stockholders Equity [Line Items] | |||||||||||
Securities remaining for future issuance (in shares) | 12,500,000 | 12,500,000 | |||||||||
Sale of stock, number of shares issued (in shares) | 3,750,000 | 8,750,000 | |||||||||
Sale of stock, price per share (in dollars per share) | $ / shares | $ 0.40 | $ 0.40 | |||||||||
Sale of stock, aggregate purchase price | $ | $ 5,000,000 | $ 5,000,000 | |||||||||
Other Investors Designated by PJC and Triax | |||||||||||
Stockholders Equity [Line Items] | |||||||||||
Warrants issued (in shares) | 13,350,000 | ||||||||||
Sale of stock, number of shares issued (in shares) | 55,000,000 | ||||||||||
Other Investors Designated by PJC and Triax | Emergent Capital, Inc. | |||||||||||
Stockholders Equity [Line Items] | |||||||||||
Percentage of ownership after sale of stocks (as percent) | 43.60% | ||||||||||
Restricted Stock | |||||||||||
Stockholders Equity [Line Items] | |||||||||||
Awards granted (in shares) | 1,000,000 | ||||||||||
Awards vested (in shares) | 333,333 | ||||||||||
Awards subject to vesting (in shares) | 1,000,000 | 333,333 | |||||||||
Omnibus Plan | |||||||||||
Stockholders Equity [Line Items] | |||||||||||
Securities remaining for future issuance (in shares) | 8,511,785 | ||||||||||
Omnibus Plan | Stock Options | |||||||||||
Stockholders Equity [Line Items] | |||||||||||
Shares of common stock reserved for future grant (in shares) | 12,600,000 | ||||||||||
Omnibus Plan | Stock Appreciation Rights | Directors | |||||||||||
Stockholders Equity [Line Items] | |||||||||||
Stock options granted (in shares) | 100,000 | ||||||||||
Stock options outstanding (in shares) | 100,000 | ||||||||||
Omnibus Plan | Restricted Stock | |||||||||||
Stockholders Equity [Line Items] | |||||||||||
Awards vested (in shares) | 2,270,000 | ||||||||||
Omnibus Plan | Restricted Stock | Directors | |||||||||||
Stockholders Equity [Line Items] | |||||||||||
Awards granted (in shares) | 633,215 | ||||||||||
Awards vested (in shares) | 633,215 | ||||||||||
Omnibus Plan | Restricted Stock | Employees | |||||||||||
Stockholders Equity [Line Items] | |||||||||||
Awards granted (in shares) | 3,270,000 | ||||||||||
Awards subject to vesting (in shares) | 1,000,000 | ||||||||||
[1] | Derived from audited consolidated financial statements. |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 9 Months Ended | |
Aug. 31, 2020 | Aug. 16, 2019 | |
Income Tax Disclosure [Abstract] | ||
Effective annual effective tax rate (as percent) | 13.12% | |
Total tax expense | $ 2.4 | |
WE Investment | Lamington | ||
Income Tax Contingency [Line Items] | ||
Equity investment ownership percentage | 27.50% | |
WE Investment | Subsidiaries | ||
Income Tax Contingency [Line Items] | ||
Equity investment ownership percentage | 27.50% | |
WE Investment | Subsidiaries | Lamington | ||
Income Tax Contingency [Line Items] | ||
Equity investment ownership percentage | 27.50% | |
WE Investment | Subsidiaries | Class B Interests | Lamington | ||
Income Tax Contingency [Line Items] | ||
Equity investment ownership percentage | 27.50% | |
Palomino | Affiliates | White Eagle | ||
Income Tax Contingency [Line Items] | ||
Percentage of equity interest sold | 72.50% |
Subsequent Events (Details)
Subsequent Events (Details) | Oct. 14, 2020numberOfRestructuringAgreements | Sep. 15, 2020numberOfLicenses | Aug. 31, 2020 | Dec. 11, 2019 | Nov. 30, 2019 | [1] | Aug. 31, 2019 | Aug. 16, 2019 | Jul. 28, 2017 | Apr. 18, 2017 |
8.5% Senior Secured Notes | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Debt interest rate | 8.50% | 8.50% | 8.50% | 8.50% | ||||||
5.0% Convertible Notes | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Debt interest rate | 5.00% | 5.00% | 5.00% | 5.00% | ||||||
Secured Notes | 8.5% Senior Secured Notes | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Debt interest rate | 8.50% | |||||||||
Convertible Notes | 5.0% Convertible Notes | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Debt interest rate | 5.00% | |||||||||
WE Investment | Lamington | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Equity investment ownership percentage | 27.50% | |||||||||
Subsidiaries | WE Investment | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Equity investment ownership percentage | 27.50% | |||||||||
Subsidiaries | WE Investment | Lamington | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Equity investment ownership percentage | 27.50% | |||||||||
Subsequent Event | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Number of restructuring support agreements | numberOfRestructuringAgreements | 2 | |||||||||
Subsequent Event | Secured Notes | 8.5% Senior Secured Notes | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Debt interest rate | 8.50% | |||||||||
Subsequent Event | Convertible Notes | 5.0% Convertible Notes | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Debt interest rate | 5.00% | |||||||||
Subsequent Event | Subsidiaries | ILS | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Number of states in which life settlement licenses were sold | 12 | |||||||||
Number of states in which life settlement licenses were surrendered | 17 | |||||||||
[1] | Derived from audited consolidated financial statements. |