Related Party Transactions |
12 Months Ended |
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Dec. 31, 2018 | |
| Related Party Transactions [Abstract] | |
| Related Party Transactions |
Related Party Transactions
Effective October 2015, Investacorp's lease with Frost Real Estate Holdings, LLC (“FREH”), an entity affiliated with the Company’s former chairman of the board and former principal shareholder, in an office building in Miami, Florida, was renewed and now expires in September 2020. The lease provides for aggregate payments during the five-year term of approximately $2,420 and minimum annual payments of $484. Rent expense under such lease amounted to $522, $506 and $522 in 2018, 2017 and 2016, respectively.
Ladenburg’s principal executive offices are located in the same office building in Miami, Florida, where approximately 14,050 square feet of office space is leased from FREH. Ladenburg’s lease was renewed effective March 2018 and now expires in February 2023 with two optional five-year extensions. The lease provides for aggregate payments during the remaining term of approximately $2,301 and minimum annual payment of $460. Rent expense under such lease amounted to $565, $565, and $706 in 2018, 2017 and 2016, respectively.
The Company is a party to an agreement with 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. Various executive officers and directors of Vector serve as members of the board of directors of the Company, and Vector owned approximately 10.37% of the Company’s common stock at December 31, 2018. 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. The Company paid Vector $850 in 2018, 2017 and 2016 under the agreement and will pay Vector at a rate of $850 per year in 2019.
In 2015, the Company entered into a Consulting Services Agreement with Nextt Advisors Inc., a corporation owned solely by the son-in-law (the “Consultant”) of the Company’s Chairman, President and Chief Executive Officer. Pursuant to the agreement, the Company paid the Consultant $200 in 2017 and $186 in 2016. Effective January 1, 2018, the consulting agreement was terminated and the consultant became an employee of the Company.
SSN has an operating lease for office facilities with Cogdill Capital LLC, an entity in which SSN's Chief Executive Officer and Chief Financial Officer are members and own a minority percentage of such entity, which expires in March 2020. Rent expense under such lease amounted to $293 in 2018, $285 in 2017 and $276 in 2016.
The Company is a party to an agreement with Castle Brands Inc. ("Castle") under which the Company provides certain administrative, legal and financial services to Castle. The Company's Chairman, President and Chief Executive Officer, who is also a director of the Company, is also the President and Chief Executive Officer and a director of Castle. Various Company directors serve as directors of Castle. The Company received $233 in 2018, $260 in 2017 and $173 in 2016 under this agreement.
In connection with the offering of Notes, as more fully described in Note 13, certain members of management and the Board of Directors of the Company and the former chairman of the board and principal shareholder purchased $10,400 of the 6.5% Senior Notes offered by the Company. See also Note 13 for information regarding other loan transactions involving related parties.
In 2018, Ladenburg acted as underwriter in two offerings of the Company's senior notes for an amount of $693.
Ladenburg holds $1,622 of 7% Senior Notes of the Company and received interest payments of $66 in 2018.
In January 2019, Michael Liebowitz joined the board of directors of the Company. Mr. Liebowitz is President and CEO of Harbor Group, and owned 50% of the equity interests in Harbor Group until the sale of Harbor Group in September 2018.
During the year ended December 31, 2018, Harbor Group was paid by unaffiliated insurance carriers approximately $884 in brokerage commissions for placing policies covering the Company and its subsidiaries. Mr. Liebowitz did not receive any direct compensation from the Company during the year ended December 31, 2018.
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