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Note 25 - Commitments and Contingent Liabilities
 12 Months Ended
Dec. 31, 2024
Notes to Financial Statements  
Commitments and Contingencies Disclosure [Text Block]

NOTE 25 COMMITMENTS AND CONTINGENT LIABILITIES

 

(a)

Legal proceedings:

 

In May 2016, Aegis Security Insurance Company ("Aegis") filed a complaint for breach of contract and declaratory relief against the Company in the Eastern District of Pennsylvania alleging, among other things, that the Company breached a contractual obligation to indemnify Aegis for certain customs bond losses incurred by Aegis under the indemnity and hold harmless agreements provided by the Company to Aegis for certain customs bonds reinsured by Lincoln General Insurance Company ("Lincoln General") during the period of time that Lincoln General was a subsidiary of the Company.  Lincoln General was placed into liquidation in November 2015 and Aegis subsequently invoked its rights to indemnity under the indemnity and hold harmless agreements. Effective January 20, 2020, Aegis and the Company entered into a Settlement Agreement with respect to such litigation pursuant to which the Company agreed to pay Aegis a one-time settlement amount of $0.9 million, and to reimburse Aegis for 60% of future losses that Aegis may sustain in connection with such customs bonds, up to a maximum reimbursement amount of $4.8 million. From 2020 through 2022, the Company made reimbursement payments to Aegis of $1.0 million in connection with the Settlement Agreement.  During 2024 and 2023, the Company made reimbursement payments to Aegis of $0.2 million and $0.5 million, respectively, in connection with the Settlement Agreement, which is included in general and administrative expenses in its consolidated statements of operations for the years ended December 31, 2024 and  December 31, 2023, respectively. The remaining maximum reimbursement amount is $3.1 million as of December 31, 2024. The Company’s potential exposure under these agreements was not reasonably determinable at December 31, 2024, and no liability has been recorded in the consolidated financial statements at December 31, 2024.

 

 

 

(b)

Collateral pledged and restricted cash:

 

Short-term investments with an estimated fair value of $0.2 million at December 31, 2024 and December 31, 2023, were on deposit with state regulatory authorities.

 

The Company also has restricted cash of $7.6 million and $8.4 million at December 31, 2024 and December 31, 2023, respectively. Included in restricted cash are:

 

 

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$6.8 million and $7.7 million at December 31, 2024 and December 31, 2023, respectively, held as deposits by IWS, Geminus, PWI, Ravix, CSuite and SPI (2023 only);

 

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$0.2 million and $0.2 million at December 31, 2024 and December 31, 2023, on deposit with state regulatory authorities; and

 

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$0.7 million and $0.5million at December 31, 2024 and December 31, 2023, respectively, pledged to third-parties as deposits or to collateralize liabilities. Collateral pledging transactions are conducted under terms that are common and customary to standard collateral pledging and are subject to the Company's standard risk management controls.