Annual report pursuant to Section 13 and 15(d)

Related Party Transactions

v3.7.0.1
Related Party Transactions
12 Months Ended
Jun. 30, 2017
Related Party Transactions [Abstract]  
Related Party Transactions
RELATED PARTY TRANSACTIONS
Sales and Purchases Made to Affiliated Companies
During the years ended June 30, 2017 and 2016, the Company made sales and purchases to various companies, which have been deemed to be related parties, as follows:
in thousands
 
 
 
 
 
Years Ended June 30,
 
2017
 
2016
 
 
Sales
 
Purchases
 
Sales
 
Purchases
 
Former Parent
 
$
47,384

 
$
47,979

 
$
30,544

 
$
42,264

 
Equity method investee
 
477,477

 
2,979

 
717,309

 
6,867

 
SilverTowne
 
27,834

 
4,648

 
4,697

 
26,789

 
 
 
$
552,695

 
$
55,606

 
$
752,550

 
$
75,920

 
Balances with Affiliated Companies
As of June 30, 2017 and June 30, 2016, the Company had related party receivables and payables balances as set forth below:
 in thousands
 
 
 
 
 
 
 
 
 
 
 
June 30, 2017
 
June 30, 2016
 
 
 
Receivables
 
Payables
 
Receivables
 
Payables
 
Former Parent
 
$

 
$
27

 
$
1,775

(1) 
$

 
Equity method investee
 

 
558

 
2,396

 

 
SilverTowne
 

 
1,768

(2) 

 
282

 
 
 
$

 
$
2,353

 
$
4,171

 
$
282

 
 
 
 
 
 
 
 
 
 
 
_________________________________
 
1) Balance includes a secured line of credit balance of $1.4 million.
 
2) Balance includes: (a) a short-term earn-out liability of $0.2 million (included as a component of the accrued liabilities balance), (b) a notes payable of $0.5 million (shown as notes payable - related party), and (c) a contingent earn-out liability of $1.1 million (shown as other long-term liabilities).
 

Secured Loans Made to Affiliated Companies
On July 23, 2015, CFC entered into a loan agreement with Former Parent providing a secured line of credit, bearing interest at a competitive rate per annum. The loan is secured by numismatic and semi-numismatic products. As of June 30, 2017 and June 30, 2016, the aggregate carrying value of this loan was $0.0 million and $1.4 million, respectively, and is shown on the consolidated balance sheets as a component "secured loans receivable" (see Note 5).
Interest Income Earned from Affiliated Companies
During the years ended June 30, 2017 and 2016, the Company earned interest income related to loans made to Former Parent and related to financing products sold to affiliated companies, as set forth below:
in thousands
 
 
 
Years Ended June 30,
 
2017
 
2016
 
Interest income from loan receivables
 
$
171

 
$
65

 
Interest income from finance products
 
2,787

 
2,302

 
 
 
$
2,958

 
$
2,367

 
 
 
 
 
 
 

Other Income Earned from Equity Method Investee
During the years ended June 30, 2017 and 2016, the Company recorded its proportional share of its equity method investee's net income as other income that total $94,000 and $701,000, respectively. As of June 30, 2017 and June 30, 2016, the carrying balance of the equity method investment was $7.5 million and $7.4 million, respectively.
Interest Expense Incurred to SilverTowne
During the years ended June 30, 2017 and 2016, the Company incurred interest expense of $3,000 and $0, respectively, related to its $0.5 million short-term note payable to SilverTowne, which is shown on the consolidated balance sheets as Note Payable - Related Party (see Note 1).
Income Tax Sharing Obligations
The amount receivable under the Company's income tax sharing obligation due from our Former Parent totaled $0.0 million, and $0.2 million as of June 30, 2017 and June 30, 2016 respectively, and is shown on the face of the consolidated balance sheets as Income taxes receivable from Former Parent (see Note 12).
Transaction with Affiliate Board Member
In February 2015, Logistics entered into various agreements with W. A. Richardson Builders, LLC ("WAR"), as amended, for the buildout of and improvements to the Las Vegas premises.  A principal of WAR, which acted as general contractor for the project, is William A. Richardson, who holds a 50% ownership interest in Silver Bow Ventures, LLC., a principal stockholder of the Company.  In addition, the spouse of the Chairman of the Company’s Audit Committee is an owner and managing member of WAR. For the years ended June 30, 2017 and June 30, 2016, the Company paid $12,000 and $820,000, respectively, for the construction work under the agreements; WAR received a fee equal to 5% of such amounts.