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Related Party Transactions
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12 Months Ended |
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Dec. 31, 2013
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| Related Party Transactions [Abstract] | |
| Related Party Transactions |
Related Party Transactions
On August 13, 2010, Investacorp entered into a five-year office lease with Frost Real Estate Holdings, LLC (“FREH”), an entity affiliated with the Company’s chairman of the board and principal shareholder. The lease which commenced on October 1, 2010, provides for aggregate payments during the five-year term of approximately $1,574 and minimum annual payments of $315. Rent expense under such lease amounted to $320, $293 and $252 in 2013, 2012 and 2011, respectively.
Ladenburg’s principal executive offices are located at 4400 Biscayne Boulevard, 12th Floor, Miami, Florida 33137, where the Company has leased approximately 15,800 square feet of office space from FREH. Rent expense under such lease amounted to $572, $560 and $536 in 2013, 2012 and 2011, respectively. Ladenburg’s lease was renewed in March 2013 and now expires in February 2018, and the amount of office space leased was increased to approximately 18,150 square feet. The lease provides for aggregate payments during the five-year term of approximately $2,995 and minimum annual payments of $599.
The Company is a party to an agreement with Vector Group Ltd. (“Vector”), where Vector has agreed to make available to the Company the services of Vector’s Executive Vice President to serve as the President and Chief Executive Officer of the Company and to provide certain other financial, tax and accounting services, including assistance with complying with Section 404 of the Sarbanes-Oxley Act of 2002 and assistance in the preparation of tax returns. Various executive officers and directors of Vector and its subsidiary New Valley serve as members of the board of directors of the Company and Vector and its subsidiaries own approximately 8.3% of the Company’s common stock at December 31, 2013. In consideration for such services, the Company agreed to pay Vector an annual management fee plus reimbursement of expenses and to indemnify
Vector. The agreement is terminable by either party upon 30 days’ prior written notice. Beginning January 1, 2012, the agreement was amended to reflect additional services to be provided as a result of the Securities America acquisition and
to increase the annual fee from $600 to $750. Effective January 1, 2014, the annual fee increased to $850. The Company paid Vector $750 in 2013, $750 in 2012 and $600 in 2011 related to the agreement.
The vice-chairman of the Company’s board of directors, a firm he serves as a consultant to, and affiliates of that firm received insurance commissions in 2011 aggregating approximately $105, on various insurance policies issued for the Company and its subsidiaries.
See Note 12 for information regarding loan transactions involving related parties.
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