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Related Party Transactions | 9 Months Ended
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Sep. 30, 2018
Related Party Transactions [Abstract] |
Related Party Transactions | 22. RELATED PARTY TRANSACTIONS The Company has identified the following related party transactions for the nine months ended September 30, 2018 and 2017. The transactions are listed by related party and, unless otherwise noted in the text of the description, the amounts are disclosed in the tables at the end of this section. A. The Bancorp, Inc. (“TBBK”) TBBK is identified as a related party because Daniel G. Cohen is TBBK’s chairman. TBBK maintained deposits for the Company in the amount of $0 and $81 as of September 30, 2018 and December 31, 2017, respectively. These amounts are not disclosed in the tables at the end of this section. As part of the Company’s broker-dealer operations, the Company from time to time purchases securities from third parties and sells those securities to TBBK. The Company may purchase securities from TBBK and ultimately sell those securities to third parties. In either of the cases listed above, the Company includes the trading revenue earned (i.e. the gain or loss realized, or commission earned) by the Company for the entire transaction in the amounts disclosed as part of net trading in the table at the end of this section. From time to time, the Company will enter into repurchase agreements with TBBK as its counterparty. As of September 30, 2018, and December 31, 2017, the Company had repurchase agreements with TBBK as the counterparty of $64,534 and $64,370, respectively. As of September 30, 2018, and December 31, 2017, the fair value of the collateral provided to TBBK by the Company relating to these repurchase agreements was $66,455 and $66,862, respectively. These amounts are included as a component of securities sold under agreements to repurchase in the Company’s consolidated balance sheets. The Company incurred interest expense related to repurchase agreements with TBBK as its counterparty in the amounts of $480 and $1,369 for the three and nine months ended September 30, 2018, respectively, and $370 and $930 for the three and nine months ended September 30, 2017, respectively, which were included as a component of net trading revenue in the Company’s consolidated statements of operations. These amounts are not disclosed in the tables at the end this section. B. Cohen Bros. Financial, LLC (“CBF”) and EBC 2013 Family Trust (“EBC”) CBF has been identified as a related party because (i) CBF is a non-controlling interest holder of the Company and (ii) CBF is wholly owned by Mr. Cohen. EBC has been identified as a related party because Mr. Cohen is a trustee of EBC. In September 2013, EBC, as an assignee of CBF, made a $4,000 investment in the Company. The Company issued $2,400 in principal amount of the 2013 Convertible Notes, and $1,600 of Common Stock to EBC. See note 17 to the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017. The Company incurred interest expense on this debt, which is disclosed as part of interest expense incurred in the table at the end of this section. Also, see note 15 for a description of amendments entered into related to the 2013 Convertible Notes on September 25, 2018. On September 29, 2017, CBF also invested $8,000 of the $10,000 total investment in the Company’s Redeemable Financial Instrument – DGC Family Fintech Trust / CBF. See note 14. The Company incurred interest expense on this debt, which is disclosed as part of interest expense incurred in the table at the end of this section. ﻿ C. The Edward E. Cohen IRA On August 28, 2015, $4,386 in principal amount of the 2013 Convertible Notes originally issued to Mead Park Capital in September 2013 was purchased by the Edward E. Cohen IRA of which Edward E. Cohen is the benefactor. Edward E. Cohen is the father of Daniel G. Cohen. The Company incurred interest expense on this debt, which is disclosed as part of interest expense incurred in the tables at the end of this section. See note 17 to the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017. Also, see note 15 for a description of amendments entered into related to the 2013 Convertible Notes on September 25, 2018. ﻿ D. JKD Investor The JKD Investor is an entity owned by Jack J. DiMaio, the vice chairman of the board of directors and vice chairman of the Operating LLC’s board of managers, and his spouse. On October 3, 2016, JKD Investor invested $6,000 in the Operating LLC. An additional $1,000 was invested in January 2017. See note 14. The interest expense incurred on this transaction is disclosed in the table at the end of this section. ﻿ E. DGC Family Fintech Trust ﻿ DGC Family Fintech Trust was established by Mr. Cohen, chairman of the Company’s board of directors and chairman of the Operating LLC board of managers. Mr. Cohen does not have any voting or dispositive control of securities held in the interest of the trust. The Company considers DGC Family Fintech Trust a related party because it was established by Mr. Cohen. ﻿ In March 2017, the DGC Family Fintech Trust purchased the 2017 Convertible Note. See note 15. The Company incurred interest expense on the 2017 Convertible Note, which is disclosed as part of interest expense incurred in the table at the end of this section. ﻿ On September 29, 2017, the DGC Family Fintech Trust also invested $2,000 of the $10,000 total investment in the Company’s Redeemable Financial Instrument – DGC Family Fintech Trust / CBF. See note 14. Interest incurred on this instrument is disclosed in the tables at the end of this section. ﻿ F. FinTech Acquisition Corp. II In July 2017, the Operating LLC entered into an agreement with FinTech Acquisition Corp. II. FinTech Acquisition Corp. II is a related party because Mr. Cohen was the chief executive officer of FinTech Acquisition Corp. II until July 2018, and Betsy Cohen, Mr. Cohen’s mother was the chairman of the board of directors of FinTech Acquisition Corp. II until July 2018. The agreement provided that the Operating LLC will provide accounting and support services to FinTech Acquisition Corp. II for a period not longer than 24 months. The revenue recorded for this arrangement is included as a component of other revenue and included in the table below. On July 26, 2018 Fintech Acquisition Corp. II merged with Intermex Holdings II. The merger terminated this arrangement. The following tables display the routine transactions recognized in the statements of operations from the identified related parties that are described above. ﻿ ﻿
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﻿RELATED PARTY TRANSACTIONS
﻿Nine Months Ended September 30, 2018
﻿(Dollars in Thousands)
﻿ |  |  |  |  |  |  |  |  |  |  |  |  |
﻿ |  |  | Net trading |  |  | Other revenue |  |  | Professional fee and other operating |  |  | Interest expense(income) incurred
﻿TBBK |  | $ | 25 |  | $ | - |  | $ | - |  |  | $ | -
﻿EBC |  |  | - |  |  | - |  |  | - |  |  |  | 180
﻿Edward E. Cohen IRA |  |  | - |  |  | - |  |  | - |  |  |  | 328
﻿DGC Family Fintech Trust |  |  | - |  |  | - |  |  | - |  |  |  | 1,167
﻿CBF |  |  | - |  |  | - |  |  | - |  |  |  | 358
﻿JKD Investor |  |  | - |  |  | - |  |  | - |  |  |  | 1,291
﻿Fintech Acquisition Corp. II |  |  | - |  |  | 17 |  |  | - |  |  |  | -
﻿ |  | $ | 25 |  | $ | 17 |  | $ | - |  |  | $ | 3,324
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﻿RELATED PARTY TRANSACTIONS
﻿Nine Months Ended September 30, 2017
﻿(Dollars in Thousands)
﻿ |  |  |  |  |  |  |  |  |  |  |  |  |
﻿ |  |  | Net trading |  |  | Other revenue |  |  | Professional fee and other operating |  |  | Interest expense(income) incurred
﻿TBBK |  | $ | 13 |  | $ | - |  | $ | - |  |  | $ | -
﻿EBC |  |  | - |  |  | - |  |  | - |  |  |  | 176
﻿Edward E. Cohen IRA |  |  | - |  |  | - |  |  | - |  |  |  | 322
﻿JKD Investor |  |  | - |  |  | - |  |  | - |  |  |  | 465
﻿DGC Family Fintech Trust |  |  | - |  |  | - |  |  | - |  |  |  | 794
﻿Fintech Acquisition Corp. II |  |  | - |  |  | 1 |  |  | - |  |  |  | -
﻿Mead Park Advisors, LLC |  |  | - |  |  | - |  |  | 50 |  |  |  | -
﻿ |  | $ | 13 |  | $ | 1 |  | $ | 50 |  |  | $ | 1,757
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﻿RELATED PARTY TRANSACTIONS
﻿Three Months Ended September 30, 2018
﻿(Dollars in Thousands)
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﻿ |  |  | Net trading |  |  | Other revenue |  |  | Professional fee and other operating |  |  | Interest expense(income) incurred
﻿TBBK |  | $ | 4 |  | $ | - |  | $ | - |  |  | $ | -
﻿EBC |  |  | - |  |  | - |  |  | - |  |  |  | 61
﻿Edward E. Cohen IRA |  |  | - |  |  | - |  |  | - |  |  |  | 111
﻿DGC Fintech Family Trust |  |  | - |  |  | - |  |  | - |  |  |  | 405
﻿CBF |  |  |  |  |  | - |  |  | - |  |  |  | 163
﻿JKD Investor |  |  | - |  |  | - |  |  | - |  |  |  | 415
﻿Fintech Acquisition Corp. II |  |  | - |  |  | 12 |  |  | - |  |  |  | -
﻿ |  | $ | 4 |  | $ | 12 |  | $ | - |  |  | $ | 1,155
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﻿RELATED PARTY TRANSACTIONS
﻿Three Months Ended September 30, 2017
﻿(Dollars in Thousands)
﻿ |  |  |  |  |  |  |  |  |  |  |  |  |
﻿ |  |  | Net trading |  |  | Other revenue |  |  | Professional fee and other operating |  |  | Interest expense(income) incurred
﻿EBC |  | $ | - |  | $ | - |  | $ | - |  |  | $ | 59
﻿Edward E. Cohen IRA |  |  | - |  |  | - |  |  | - |  |  |  | 109
﻿JKD Investor |  |  | - |  |  | - |  |  | - |  |  |  | 210
﻿DGC Fintech Family Trust |  |  | - |  |  | - |  |  | - |  |  |  | 359
﻿Fintech Acquisition Corp. II |  |  | - |  |  | 1 |  |  | - |  |  |  | -
﻿ |  | $ | - |  | $ | 1 |  | $ | - |  |  | $ | 737
﻿ The following related party transactions are non-routine and are not included in the tables above. G. Directors and Employees The Company has entered into employment agreements with Mr. Cohen and Joseph W. Pooler, Jr., its chief financial officer. The Company has entered into its standard indemnification agreement with each of its directors and executive officers. The Company maintains a 401(k) savings plan covering substantially all of its employees. The Company matches 50% of employee contributions for all participants not to exceed 3% of their salary. Contributions made on behalf of the Company were $46 and $164 for the t hree and nine months ended September 30, 2018, respectively, and $41 and $177 for the three and nine months ended September 30, 2017, respectively. In addition, in privately negotiated transactions: (i) on August 29, 2018 the Company purchased 17,555 shares for $176 or $10 per share from a current member of the board of directors and (ii) on May 25, 2017, the Company purchased 2,774 shares from an employee of the Company for an aggregate purchase price of $33 or $12 per share. See note 16. The Company had a sublease agreement for certain office space with Jack DiMaio, vice chairman of the Company’s board of directors. The Company received payments under this agreement. The payments were recorded as a reduction in the related rent and utility expenses. The Company recorded a reduction in the rent and utility expenses in the amount of $0 and $11 for the three and nine months ended September 30, 2017, respectively. This sublease agreement terminated May 31, 2017. Subsequent to the termination of the sublease agreement, the Company agreed to lease office space from the Zucker and Moore, LLC. Zucker and Moore, LLC is partially owned by Mr. DiMaio. The Company recorded $24 and $72 of rent expense for the three and nine months ended September 30, 2018, respectively. H. FinTech Investor Holdings II, LLC In July 2018, the Operating LLC acquired publicly traded shares of Fintech Acquisition Corp. II from an unrelated third party for a total purchase price of $2,513. In connection with this purchase, the Operating LLC agreed with Fintech Investor Holdings II, LLC to not redeem these shares in advance of the merger between Fintech Acquisition Corp. II and Intermex Holdings II, LLC. FinTech Investor Holdings II, LLC is considered a related party because Mr. Cohen is the manager of the entity. In exchange for this agreement to not redeem these shares prior to the merger, as well as the outlay of capital to purchase the publicly traded shares of Fintech Acquisition Corp. II, the Operating LLC received unregistered, restricted shares of common stock of Fintech Acquisition Corp. II from Fintech Investor Holdings II, LLC. In connection with the merger, Fintech Acquisition Corp. II changed its name to International Money Express, Inc. The Company recorded principal transactions and other income of $397 in the three and nine months ended September 30, 2018 in connection with the receipt of these restricted shares.

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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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