Annual report pursuant to Section 13 and 15(d)

CONSOLIDATED STATEMENTS OF CASH FLOWS

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CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2015
Dec. 31, 2014
Dec. 31, 2013
Cash flows from operating activities:      
Net (loss) income $ (11,213) $ 33,352 $ (522)
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities:      
Change in fair value of contingent consideration (55) (12) 121
Adjustment to deferred rent 37 (357) (106)
Amortization of intangible assets 20,650 14,056 11,594
Write-off on intangible asset 0 0 143
Depreciation and other amortization 6,427 4,341 3,676
Loss on extinguishment of debt 252 548 4,547
Amortization of debt discount 666 501 1,219
Amortization of debt issue cost 376 393 435
Amortization of retention and forgivable loans 9,238 11,041 11,544
Deferred income taxes (400) (25,521) 954
Benefit attributable to reduction of goodwill 78 68 77
Non-cash interest expense on forgivable loan 21 98 132
Gain on forgiveness of accrued interest under forgivable loans (619) (839) (1,067)
Gain on forgiveness of principal of note payable under forgivable loans (3,928) (3,929) (3,929)
Non-cash compensation expense 8,759 10,541 6,766
Loss on write-off of receivable from subtenant 855 0 0
Loss on write-off of furniture, fixtures and leasehold improvements. net 9 9 430
(Increase) decrease in operating assets, net of effects of acquisitions:      
Securities owned, at fair value 1,989 (522) (2,711)
Receivables from clearing brokers (5,076) (5,907) (14,418)
Receivables from other broker-dealers (362) 338 23
Other receivables, net 19 (7,014) (1,153)
Notes receivable from financial advisors, net (9,828) (5,442) (4,147)
Cash surrender value of life insurance 1,172 1,951 (1,163)
Other assets (5,381) (39) (5,367)
Increase (decrease) in operating liabilities, net of effects of acquisitions:      
Securities sold, but not yet purchased, at fair value 8 147 (209)
Accrued compensation 5,632 (803) 8,081
Accrued interest 292 102 (2,397)
Commissions and fees payable 2,139 8,272 1,230
Deferred compensation liability (429) (2,003) 1,101
Accounts payable and accrued liabilities (2,009) (6,515) 5,990
Net cash provided by operating activities 19,319 26,855 20,874
Cash flows from investing activities:      
Acquisition of SSN, net of cash received (16,919) 0 0
Acquisition of Highland, net of cash received 0 (3,353) 0
Acquisition of KMS, net of cash received 0 (4,292) 0
Other business acquisitions (2,603) (1,621) 0
Purchases of fixed assets (8,298) (7,447) (6,861)
Sale of fixed assets 0 0 88
(Increase) decrease in restricted assets (391) 100 (250)
Net cash used in investing activities (28,211) (16,613) (7,023)
Cash flows from financing activities:      
Issuance of Series A preferred stock 84,380 108,617 147,929
Issuance of common stock 2,016 3,282 1,256
Series A preferred stock dividends paid (28,108) (17,244) (6,911)
Repurchases of common stock (16,355) (9,535) (6,446)
Issuance of notes payable and warrants 0 0 1,709
Principal repayments on notes payable including, in 2014, repayment of $21,834 of Highland's assumed debt (17,639) (42,369) (111,113)
Principal borrowings (repayments) under revolving credit facilities, net 495 (275) (25,500)
Term loan repayments (387) 0 0
Third party investment in subsidiary 80 40 120
Net cash provided by financing activities 24,482 42,516 1,044
Net increase in cash and cash equivalents 15,590 52,758 14,895
Cash and cash equivalents, beginning of period 103,087 50,329 35,434
Cash and cash equivalents, end of period 118,677 103,087 50,329
Supplemental cash flow information:      
Interest paid 3,807 5,920 16,034
Taxes paid 2,313 2,554 544
Payments to acquire business 16,919 0 $ 0
Acquisition of Sunset      
Cash flows from investing activities:      
Acquisition of SSN, net of cash received   (1,621)  
Assets acquired   4,380  
Liabilities assumed   0  
Net assets acquired   4,380  
Payable to seller   (2,759)  
Payments to acquire business   1,621  
Acquisition of Highland      
Cash flows from investing activities:      
Acquisition of SSN, net of cash received   (3,353)  
Assets acquired   65,882  
Liabilities assumed   (54,316)  
Net assets acquired   11,566  
Stock issued in acquisition   (7,953)  
Cash paid in acquisition   3,613  
Cash acquired in acquisition   (260)  
Payments to acquire business   3,353  
Acquisition of KMS      
Cash flows from investing activities:      
Acquisition of SSN, net of cash received   (4,292)  
Assets acquired   39,844  
Liabilities assumed   (15,284)  
Net assets acquired   24,560  
Stock issued in acquisition   (6,052)  
Cash paid in acquisition   11,000  
Promissory note   (7,508)  
Cash acquired in acquisition   (6,708)  
Payments to acquire business   $ 4,292  
SSN      
Cash flows from operating activities:      
Net (loss) income 1,629    
Cash flows from investing activities:      
Acquisition of SSN, net of cash received (16,919)    
Assets acquired 61,759    
Liabilities assumed (14,472)    
Net assets acquired 47,287    
Payable to seller (3,590)    
Cash paid in acquisition 25,000    
Promissory note (18,697)    
Cash acquired in acquisition (8,081)    
Payments to acquire business 16,919    
Dalton      
Cash flows from investing activities:      
Acquisition of SSN, net of cash received (2,100)    
Assets acquired 2,689    
Payable to seller (589)    
Payments to acquire business 2,100    
Select      
Cash flows from investing activities:      
Acquisition of SSN, net of cash received (503)    
Assets acquired 2,019    
Payable to seller (1,516)    
Payments to acquire business $ 503