Commitments and Contingencies
|12 Months Ended|
Dec. 31, 2013
|Commitments and Contingencies||
10. COMMITMENTS AND CONTINGENCIES
The Company leases office space pursuant to operating leases that are subject to specific escalation clauses. Rent expense charged to operations for the years ended December 31, 2013, 2012 and 2011 amounted to $3,558, $3,588, and $3,304, respectively. The Company received sub-lease income from subtenants during the years ended December 31, 2013, 2012 and 2011 of $805, $764, and $1,006, respectively. Therefore, for the years ended December 31, 2013, 2012 and 2011, net rent expense amounted to $2,753, $2,824, and $2,298, respectively, and is included in general and administrative expenses in the Consolidated Statement of Operations.
During 2006, the Company entered into a lease agreement for office space for its headquarters. The lease commenced on January 1, 2007 and expires September 30, 2017. The lease is subject to escalation clauses and provides for rent free periods of 6 to 9 months and a leasehold improvement allowance of $1,538 provided the Company spends at least an additional $513 on improvements. The Company spent $3,284 on leasehold improvements and received $1,499 of the allowance during 2007; the remaining $39 of the allowance was received in 2008. As security for performance under the leases, the Company is required to maintain letters of credit in favor of the landlord totaling $2,023 that were reduced to $1,013 on August 31, 2010 and can be further reduced to $506 on August 31, 2014. The letter of credit is collateralized by a certificate of deposit in an equal amount.
Future minimum lease payments and rentals under lease agreements which expire through 2017 are as follows:
The Company has capital leases for certain office equipment. The principal balance of these leases was $19 and $33 as of December 31, 2013 and December 31, 2012, respectively.
In connection with its acquisition of MCG in October 2008, SLP entered into a contingent consideration agreement whereby the former members of MCG were entitled to contingent consideration equal to 22% of adjusted annual EBITDA in addition to any performance fee payments for each of the five years subsequent to the date of acquisition. As the acquisition was completed prior to January 1, 2009, contingent consideration is recognized when the contingency is resolved pursuant to the authoritative guidance on business combinations in effect at the date of the closing of the acquisition. The contingent consideration related to the MCG acquisition is recorded on the date when the contingency is resolved. Contingent consideration payments of $703, $720 and $663 were made during the years ended December 31, 2013, 2012 and 2011, respectively, related to MCG and are reflected in investing activities in the Consolidated Statements of Cash Flows.
Quarterly contingent payments related to the Commodity Advisors acquisition were accrued when the contingency was resolved. The total accrual for these payments for the year ended December 31, 2013 was $31, which was recorded as compensation expense in the Consolidated Statements of Operations.
The entire disclosure for commitments and contingencies.
Reference 1: http://www.xbrl.org/2003/role/presentationRef