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Related Party Transactions | 9 Months Ended
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Sep. 30, 2018
Related Party Transactions [Abstract] |
Related Party Transactions | Note 15—Related Party Transactions On June 8, 2018, the Company sold shares of its Class B common stock and warrants to purchase shares of its Class B common stock to Howard S. Jonas (see Note 10). The Company was formerly a subsidiary of IDT Corporation (“IDT”). On October 28, 2011, the Company was spun-off by IDT. The Company entered into various agreements with IDT prior to the spin-off including an agreement for certain services to be performed by the Company and IDT. Also, the Company provides specified administrative services to certain of IDT’s foreign subsidiaries. On March 26, 2018, IDT completed a pro rata distribution of the common stock that IDT held in IDT’s subsidiary, Rafael Holdings, Inc. (“Rafael”) to IDT’s stockholders. Howard S. Jonas is the Chairman of the Board of Directors and the Chief Executive Officer of Rafael. The Company leases office space and parking in Rafael’s building and parking garage located at 520 Broad St, Newark, NJ. The Company also leases office space in Israel from Rafael. The leases expire in April 2025. The charges for services provided by IDT to the Company, and rent charged by Rafael, net of the charges for the services provided by the Company to IDT, are included in “Selling, general and administrative” expense in the consolidated statements of operations.
|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
|  | 2018 |  |  | 2017 |  |  | 2018 |  |  | 2017 |
|  | (in thousands) |
Amount IDT charged the Company |  | $ | 224 |  |  | $ | 313 |  |  | $ | 920 |  |  | $ | 1,203 |
Amount the Company charged IDT |  | $ | 73 |  |  | $ | 116 |  |  | $ | 302 |  |  | $ | 346 |
Amount Rafael charged the Company |  | $ | 53 |  |  | $ | — |  |  | $ | 107 |  |  | $ | — |
The following table presents the balance of receivables and payables to IDT and Rafael:
|  | September 30, 2018 |  |  | December 31, 2017 |
|  | (in thousands) |
Due to IDT |  | $ | 142 |  |  | $ | 360 |
Due from IDT |  |  | 52 |  |  |  | 132 |
Due to Rafael |  |  | — |  |  |  | — |
The Company had minimal transactions with Zedge, Inc. (“Zedge”) related to certain employees of the Company providing services to Zedge. Zedge was a subsidiary of IDT and was spun-off in June 2016 and Howard Jonas is a current director. There is minimal amount due from Zedge at September 30, 2018 and December 31, 2017 On August 31, 2018, the Company settled an option issued to an employee to purchase shares of the Company’s various subsidiaries with a net book value of $1.0 million and was included as other liabilities in the consolidated balance sheet. The Company paid the employee $0.8 million and recognized a gain from extinguishment of liability of $0.2 for the three and nine months ended September 30, 2018. From 2012 to 2015, the Company extended a series of loans to an employee with an aggregate principal amount of $0.5 million (“Promissory Notes”). The Promissory Notes bore interest equivalent to a minimum rate, in effect from time to time required by local regulations. The Notes and the related unpaid accrued interest were due on May 1, 2019. On August 31, 2018, the Company entered into a Loan Modification Agreement with the employee to restructure the Promissory Notes with outstanding balance of $0.5 million including $0.1 million of accrued interest. Based on the Loan Modification Agreement, the employee will pay $0.4 million and the remaining outstanding balance of $0.1 million of the Promissory Notes and the related accrued interest will be restated in a single promissory note (“New Note”). The New Note requires scheduled payments starting on December 31, 2020 until December 31, 2052. The New Note bear the same interest as the Promissory Notes and will be compounded annually. The Company recorded minimal amounts of interest income for the three and nine months ended September 30, 2018 and 2017 related to the Promissory Notes and New Notes. The outstanding balance of the New Notes, including accrued interest was $0.1 million as of September 30, 2018. The Company obtains insurance policies from several insurance brokers, one of which is IGM Brokerage Corp. (“IGM”). IGM is owned by the mother of Howard S. Jonas and Joyce Mason, the Company’s Corporate Secretary. Jonathan Mason, husband of Joyce Mason and brother-in-law of Howard S. Jonas, provides insurance brokerage services via IGM. Based on information the Company received from IGM, the Company believes that IGM received commissions and fees from payments made by the Company (including payments from third party brokers). The Company paid IGM a total of $0.2 million in October 2017 related to premium of various insurance policies (for the period from November 2017 to October 2018) that were brokered by IGM. There was no outstanding payable to IGM was as of September 30, 2018. Neither Howard S. Jonas nor Joyce Mason has any ownership or other interest in IGM other than via the familial relationships with their mother and Jonathan Mason. Michael Jonas is the son of Howard Jonas, the Company’s Chairman of the Board and controlling stockholder. Until November 6, 2018, Michael Jonas served as Executive Vice President of the Company and in other capacities with certain subsidiaries of the Company. From November 6, 2018, Michael Jonas no longer serves as an executive officer of the Company, although he continues to serve as Vice President of GOGAS.

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- Definition The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 850 -URI http://asc.fasb.org/topic&trid=2122745 + Details
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