Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Mar. 20, 2020 | Jun. 30, 2019 | |
Document And Entity Information [Abstract] | |||
Entity Registrant Name | MEDLEY LLC | ||
Entity Central Index Key | 0001536577 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Non-accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Shell Company | false | ||
Entity Emerging Growth Company | false | ||
Entity Small Business | true | ||
Entity Common Stock, Shares Outstanding | 30,221,518 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Public Float | $ 0 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Assets | ||
Cash and cash equivalents | $ 10,377 | $ 16,970 |
Investments, at fair value | 13,287 | 36,425 |
Management fees receivable | 8,104 | 10,274 |
Right-of-use assets under operating leases | 6,564 | |
Other assets | 9,727 | 14,145 |
Total Assets | 48,059 | 77,814 |
Liabilities, Redeemable Non-controlling Interests and Equity | ||
Senior unsecured debt, net | 118,382 | 117,618 |
Loans payable, net | 10,000 | 9,892 |
Due to former minority interest holder, net | 8,145 | 11,402 |
Operating lease liabilities | 8,267 | |
Accounts payable, accrued expenses and other liabilities | 21,886 | 26,444 |
Total Liabilities | 166,680 | 165,356 |
Commitments and Contingencies (Note 12) | ||
Redeemable Non-controlling Interests | (748) | 23,186 |
Members' Deficit | ||
Members' deficit | (117,482) | (109,981) |
Total deficit | (117,873) | (110,728) |
Total Liabilities, Redeemable Non-controlling Interests and Equity | 48,059 | 77,814 |
Consolidated Subsidiaries [Member] | ||
Members' Deficit | ||
Non-controlling interests | $ (391) | $ (747) |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenues | |||
Revenues | $ 49,176 | $ 57,588 | |
Investment income: | |||
Carried interest | 819 | 142 | $ 230 |
Other investment loss, net | (1,154) | (1,221) | (528) |
Total Revenues | 48,841 | 56,509 | 65,033 |
Expenses | |||
Compensation and benefits | 28,925 | 31,666 | 26,558 |
General, administrative and other expenses | 17,186 | 19,366 | 13,045 |
Total Expenses | 46,111 | 51,032 | 39,603 |
Other Income (Expenses) | |||
Dividend income | 1,119 | 4,311 | 4,327 |
Interest expense | (11,497) | (10,806) | (11,855) |
Other (expenses) income, net | (4,412) | (20,250) | 1,361 |
Total other (expenses) income, net | (14,790) | (26,745) | (6,167) |
(Loss) income before income taxes | (12,060) | (21,268) | 19,263 |
Provision for (benefit from) income taxes | 3,559 | (300) | 596 |
Net (Loss) Income | (15,619) | (20,968) | 18,667 |
Net (Loss) Income Attributable to Medley LLC | (11,923) | (9,886) | 11,949 |
Consolidated Subsidiaries [Member] | |||
Other Income (Expenses) | |||
Net income (loss) attributable to non-controlling interests | (3,696) | (11,082) | 6,718 |
Management Fees [Member] | |||
Revenues | |||
Revenues | 39,473 | 47,085 | 58,104 |
Investment Performance [Member] | |||
Revenues | |||
Revenues | 0 | 0 | (1,974) |
Other Revenues and Fees [Member] | |||
Revenues | |||
Revenues | $ 9,703 | $ 10,503 | $ 9,201 |
Consolidated Statements of Op_2
Consolidated Statements of Operations (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Statement [Abstract] | |||
Incentive fees | $ 176 | $ 0 | $ 4,874 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Net Income (Loss) | $ (15,619) | $ (20,968) | $ 18,667 |
Other Comprehensive Income (Loss): | |||
Change in fair value of available-for-sale securities (net of taxes of $x.x million and $x.x million for Medley Management Inc. for the three months ended March 31, 2018 and 2017, respectively) | 0 | 0 | (11,162) |
Total Comprehensive Income (Loss) | (15,619) | (20,968) | 7,505 |
Comprehensive (Loss) Income Attributable to Medley Management Inc. | (11,923) | (9,886) | 815 |
Consolidated Subsidiaries [Member] | |||
Other Comprehensive Income (Loss): | |||
Net income attributable to non-controlling interests | $ (3,696) | $ (11,082) | 6,718 |
Medley LLC [Member] | |||
Other Comprehensive Income (Loss): | |||
Comprehensive income (loss) attributable to non-controlling interests | $ 6,690 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) $ in Millions | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Statement of Comprehensive Income [Abstract] | |
Available-for-sale securities, tax, Medley Management | $ 0.3 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Equity - USD ($) $ in Thousands | Total | Members' Deficit | Accumulated Other Comprehensive Loss | Non- controlling Interests in Consolidated SubsidiariesConsolidated Subsidiaries [Member] |
Beginning balance at Dec. 31, 2016 | $ (48,992) | $ (47,441) | $ 166 | $ (1,717) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net (loss) income attributable to Medley LLC | 11,949 | 11,949 | ||
Net (loss) income attributable to non-controlling interests | 18,667 | 16 | ||
Net (loss) income | 11,965 | |||
Change in fair value of available-for-sale securities, net of income tax benefit | (11,134) | (11,134) | ||
Reclass of cumulative dividends on forfeited RSUs to compensation and benefits expense | 668 | 668 | ||
Repurchases of LLC Units | (3,590) | (3,590) | ||
Contributions | 2,771 | 2,771 | ||
Distributions | (29,960) | (29,959) | (1) | |
Ending balance at Dec. 31, 2017 | (78,240) | (65,570) | (10,968) | (1,702) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net (loss) income attributable to Medley LLC | (9,886) | (9,886) | ||
Net (loss) income attributable to non-controlling interests | (20,968) | 279 | ||
Net (loss) income | (9,607) | |||
Reclass of cumulative dividends on forfeited RSUs to compensation and benefits expense | 98 | 98 | ||
Contributions | 5,406 | 5,404 | 2 | |
Distributions | (26,425) | (26,425) | ||
Issuance of non-controlling interest in consolidated subsidiaries at fair value | 674 | 674 | ||
Fair value adjustment to redeemable non-controlling interest in SIC Advisors LLC (Note 15) | 965 | 965 | ||
Ending balance at Dec. 31, 2018 | (110,728) | (109,981) | 0 | (747) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net (loss) income attributable to Medley LLC | (11,923) | (11,923) | ||
Net (loss) income attributable to non-controlling interests | (15,619) | 579 | ||
Net (loss) income | (11,344) | |||
Reclass of cumulative dividends on forfeited RSUs to compensation and benefits expense | 343 | 343 | ||
Contributions | 5,423 | 5,423 | ||
Distributions | (1,195) | (972) | (223) | |
Recognition of deferred tax asset in connection with the acquisition of a minority interest holder's ownership interests in a consolidated subsidiary of Medley LLC | 440 | 440 | ||
Fair value adjustment to redeemable non-controlling interest in SIC Advisors LLC (Note 15) | (812) | (812) | ||
Ending balance at Dec. 31, 2019 | $ (117,873) | $ (117,482) | $ 0 | $ (391) |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Equity (Parenthetical) - $ / shares | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Common Class A [Member] | |||
Dividends (in dollars per share) | $ 0.20 | $ 0.03 | $ 0.20 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash flows from operating activities | ||||
Net (loss) income | $ (10,699) | $ (15,619) | $ (20,968) | $ 18,667 |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||
Stock-based compensation | 7,222 | 5,404 | 2,771 | |
Amortization of debt issuance costs | 754 | 741 | 1,579 | |
Accretion of debt discount | 1,297 | 667 | 1,126 | |
Benefit from deferred taxes | 3,524 | (1,162) | (85) | |
Depreciation and amortization | 702 | 1,076 | 911 | |
Net change in unrealized depreciation on investments | 5,287 | 20,900 | 554 | |
Non-cash based performance fee compensation | 0 | 619 | 0 | |
Income from equity method investments | (482) | 6 | (274) | |
Impairment on investments held at cost | 90 | 0 | ||
Reclassification of cumulative dividends paid on forfeited restricted stock units to compensation and benefits expense | 343 | 98 | 668 | |
Non-cash lease costs | 2,434 | |||
Other non-cash amounts | 178 | 56 | (13) | |
Changes in operating assets and liabilities: | ||||
Management fees receivable | 2,170 | 4,440 | (2,084) | |
Performance fees receivable | 0 | 0 | 1,974 | |
Distributions of income received from equity method investments | 1,211 | 691 | 629 | |
Purchase of investments | (706) | (1,861) | (2,005) | |
Sale of investments | 1,111 | 1,920 | 0 | |
Other assets | (258) | 794 | 1,037 | |
Operating lease liabilities | (2,725) | |||
Accounts payable, accrued expenses and other liabilities | (4,230) | 2,061 | (12,652) | |
Net cash provided by operating activities | 2,213 | 15,572 | 12,803 | |
Cash flows from investing activities | ||||
Purchases of fixed assets | (126) | (56) | (73) | |
Distributions received from investment held at cost less impairment | 222 | 0 | 0 | |
Capital contributions to equity method investments | (3) | (1,538) | (322) | |
Distributions received from equity method investment | 0 | 0 | 172 | |
Purchases of investments | 0 | 0 | (34,980) | |
Net cash provided by (used in) investing activities | 93 | (1,594) | (35,203) | |
Cash flows from financing activities | ||||
Payments to former minority interest holder | (4,375) | (847) | 0 | |
Repayments of loans payable | 0 | 0 | (44,800) | |
Proceeds from issuance of senior unsecured debt | 0 | 0 | 69,108 | |
Capital contributions from non-controlling interests | 0 | 2 | 23,000 | |
Distributions to members, non-controlling interests and redeemable non-controlling interests | (4,524) | (32,378) | (36,698) | |
Debt issuance costs | 0 | 0 | (2,868) | |
Repurchases of LLC Units | 0 | 0 | (3,590) | |
Net cash (used in) provided by financing activities | (8,899) | (33,223) | 4,152 | |
Net decrease in cash and cash equivalents | (6,593) | (19,245) | (18,248) | |
Cash and cash equivalents, beginning of period | 16,970 | 36,215 | 54,463 | |
Cash and cash equivalents, end of period | 10,377 | 10,377 | 16,970 | 36,215 |
Supplemental cash flow information | ||||
Interest paid | 9,446 | 9,396 | ||
Income taxes paid | 143 | 955 | ||
Recognition of right-of-use assets under operating leases upon adoption of new leasing standard | 6,564 | 6,564 | ||
Recognition of operating lease liabilities offset against right-of-use assets under operating leases upon adoption of new leasing standard | 8,267 | 8,267 | ||
Accretion of operating lease liabilities recorded against right-of-use assets | ||||
Distribution of shares of MCC incurred in connection with the exercise of a put option right by a former minority interest holder (Notes 11 and 16) | (16,498) | 0 | 0 | |
Net deferred tax / Reclassification of the income tax impact on cumulative effect of accounting change due to the adoption of accounting standards update | 0 | 0 | 3,144 | |
Reclassification of redeemable non-controlling interest in SIC Advisors LLC, including fair value adjustment of $965 (Note 16) | 0 | (12,275) | 0 | |
Transfer to Investments | 0 | 0 | 10,306 | |
ASU 2016-02 [Member] | ||||
Supplemental cash flow information | ||||
Recognition of right-of-use assets under operating leases upon adoption of new leasing standard | 8,233 | 8,233 | ||
Recognition of operating lease liabilities offset against right-of-use assets under operating leases upon adoption of new leasing standard | 10,229 | 10,229 | ||
ASC 606 [Member] | ||||
Supplemental cash flow information | ||||
Net deferred tax / Reclassification of the income tax impact on cumulative effect of accounting change due to the adoption of accounting standards update | 0 | 0 | (125) | 0 |
ASU 2016-01 [Member] | ||||
Supplemental cash flow information | ||||
Net deferred tax / Reclassification of the income tax impact on cumulative effect of accounting change due to the adoption of accounting standards update | 0 | 0 | 649 | 0 |
ASU 2018-02 [Member] | ||||
Supplemental cash flow information | ||||
Reclassification of the income tax impact of the Tax Cuts and Jobs Act on items within accumulated other comprehensive loss to retained earnings due to the early adoption of accounting standards update 2018-02 | 0 | 207 | 0 | |
Accounting Standards Update 2016-09 [Member] | ||||
Supplemental cash flow information | ||||
Net deferred tax / Reclassification of the income tax impact on cumulative effect of accounting change due to the adoption of accounting standards update | 0 | 0 | 0 | 118 |
Medley LLC [Member] | ||||
Supplemental cash flow information | ||||
Net deferred tax / Reclassification of the income tax impact on cumulative effect of accounting change due to the adoption of accounting standards update | $ 440 | 440 | 0 | 0 |
Reclassification of redeemable non-controlling interest in SIC Advisors LLC, including fair value adjustment of $965 (Note 16) | $ (18,109) | $ 0 | $ 0 |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Fair value adjustment | $ (812) | $ 965 | |
Redeemable Non-controlling Interests [Member] | |||
Fair value adjustment | (812) | $ 965 | $ 0 |
Medley LLC [Member] | Redeemable Non-controlling Interests [Member] | |||
Fair value adjustment | $ 812 |
ORGANIZATION AND BASIS OF PRESE
ORGANIZATION AND BASIS OF PRESENTATION | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation | ORGANIZATION AND BASIS OF PRESENTATION Medley LLC is an alternative asset management firm offering yield solutions to retail and institutional investors. The Company's national direct origination franchise provides capital to the middle market in the United States of America. Medley LLC, provides investment management services to permanent capital vehicles, long-dated private funds and separately managed accounts and serves as the general partner to the private funds, which are generally organized as pass-through entities. Medley LLC and its consolidated subsidiaries (collectively “Medley” or the “Company”) is headquartered in New York City. Medley's business is currently comprised of only one reportable segment, the investment management segment, and substantially all of the Company operations are conducted through this segment. The investment management segment provides investment management services to permanent capital vehicles, long-dated private funds and separately managed accounts. The Company conducts its investment management business in the U.S., where substantially all its revenues are generated. Registered Public Offering of Medley LLC Notes On August 9, 2016, Medley LLC completed a registered public offering of $25.0 million of an aggregate principal amount of 6.875% senior notes due 2026 (the "2026 Notes") at a public offering price of 100% of the principal amount. On October 18, 2016, Medley LLC completed a public offering of an additional $28.6 million in aggregate principal amount of the 2026 Notes at a public offering price of $24.45 for each $25.00 principal amount of notes. The notes mature on August 15, 2026 and interest is payable quarterly. The notes will be redeemable in whole or in part at Medley's option on or after August 15, 2019 at a redemption price of 100% of the aggregate principal amount plus accrued and unpaid interest payments. The Company used the net proceeds from the offering to repay a portion of the outstanding indebtedness under the Company's Term Loan Facility. The 2026 Notes are listed on the New York Stock Exchange and trades thereon under the trading symbol “MDLX.” On January 18, 2017, Medley LLC completed a registered public offering of $34.5 million of an aggregate principal amount of 7.25% senior notes due 2024 (the “2024 Notes”) at a public offering price of 100% of the principal amount. On February 22, 2017, Medley LLC completed a public offering of an additional $34.5 million in aggregate principal amount of the 2024 Notes at a public offering price of $25.25 for each $25.00 principal amount of notes. The 2024 Notes mature on January 30, 2024 and interest is payable quarterly commencing on April 30, 2017. The notes will be redeemable in whole or in part at Medley's option on or after January 30, 2020 at a redemption price of 100% of the aggregate principal amount plus accrued and unpaid interest payment. The Company used the net proceeds from the offering to repay the remaining outstanding indebtedness under the Term Loan Facility and for general corporate purposes. The 2024 Notes are listed on the New York Stock Exchange and trade thereon under the trading symbol “MDLQ.” Medley LLC Reorganization In connection with the IPO of Medley Management Inc. ("MDLY"), Medley LLC amended and restated its limited liability agreement to modify its capital structure by reclassifying the 23,333,333 interests held by the pre-IPO members into a single new class of units (“LLC Units”). The pre-IPO members also entered into an exchange agreement under which they (or certain permitted transferees thereof) have the right, subject to the terms of an exchange agreement, to exchange their LLC Units for shares of Medley Management Inc.’s Class A common stock on a one -for-one basis, subject to customary conversion rate adjustments for stock splits, stock dividends and reclassifications. In addition, pursuant to the amended and restated limited liability agreement, Medley Management Inc. became the sole managing member of Medley LLC. The pre-IPO owners were, subject to limited exceptions, prohibited from transferring any LLC Units held by them or any shares of Class A common stock received upon exchange of such LLC Units, until September 29, 2017, which was the third anniversary of the date of the closing of the IPO, without the Company’s consent. Thereafter and prior to the fourth and fifth anniversaries of the closing of the IPO, such holders could not transfer more than 33 1/3% and 66 2/3%, respectively, of the number of LLC Units held by them, together with the number of any shares of Class A common stock received by them upon exchange therefore, without the Company’s consent. Agreement and Plan of Merger On August 9, 2018, MDLY entered into the Agreement and Plan of Merger (the “MDLY Merger Agreement”), dated as of August 9, 2018, by and among MDLY, Sierra Income Corporation ("Sierra" or "SIC") and Sierra Management, Inc., a wholly owned subsidiary of Sierra ("Merger Sub"), pursuant to which MDLY would, on the terms and subject to the conditions set forth in the MDLY Merger Agreement, merge with and into Merger Sub, with Merger Sub as the surviving company in the merger (the “MDLY Merger”). In the MDLY Merger, each share of MDLY Class A common stock, issued and outstanding immediately prior to the MDLY Merger effective time (other than Dissenting Shares (as defined in the MDLY Merger Agreement) and shares of MDLY Class A common stock held by the Company, Sierra or their respective wholly owned subsidiaries) would be converted into the right to receive (i) 0.3836 shares of Sierra’s common stock; plus (ii) cash in an amount equal to $3.44 per share. In addition, MDLY stockholders would have the right to receive certain dividends and/or other payments. Simultaneously, pursuant to the Agreement and Plan of Merger, dated as of August 9, 2018, by and between Medley Capital Corporation (“MCC”) and Sierra (the “MCC Merger Agreement”), MCC would, on the terms and subject to the conditions set forth in the MCC Merger Agreement, merge with and into Sierra, with Sierra as the surviving company in the merger (the “MCC Merger” together with the MDLY Merger, the “Mergers”). In the MCC Merger, each share of MCC’s common stock issued and outstanding immediately prior to the MCC Merger effective time (other than shares of MCC’s common stock held by MCC, Sierra or their respective wholly owned subsidiaries) would be converted into the right to receive 0.8050 shares of Sierra’s common stock. On July 29, 2019, MDLY entered into the Amended and Restated Agreement and Plan of Merger, dated as of July 29, 2019 (the “Amended MDLY Merger Agreement”), by and among MDLY, Sierra, and Merger Sub, pursuant to which MDLY and the Company will, on the terms and subject to the conditions set forth in the Amended MDLY Merger Agreement, merge with and into Merger Sub, with Merger Sub as the surviving company in the MDLY Merger. In the MDLY Merger, each share of MDLY Class A common stock, issued and outstanding immediately prior to the MDLY Merger effective time (other than shares of MDLY Class A common stock held by the Company, Sierra or their respective wholly owned subsidiaries (the “Excluded MDLY Shares”) and the Dissenting Shares (as defined in the Amended MDLY Merger Agreement), held, immediately prior to the MDLY Merger effective time, by any person other than a holder of LLC Units), will be exchanged for (i) 0.2668 shares of Sierra’s common stock; plus (ii) cash in an amount equal to $2.96 per share. In addition, in the MDLY Merger, each share of MDLY Class A common stock issued and outstanding immediately prior to the MDLY Merger effective time, other than the Excluded MDLY Shares and the Dissenting Shares, held, immediately prior to the MDLY Merger effective time, by holders of LLC Units will be exchanged for (i) 0.2072 shares of Sierra’s common stock; plus (ii) cash in an amount equal to $2.66 per share. Under the Amended MDLY Merger Agreement, the MDLY exchange ratios and the cash consideration amount was fixed on July 29, 2019, the date of the signing of the Amended MDLY Merger Agreement. The MDLY exchange ratios and the cash consideration amount are not subject to adjustment based on changes in the NAV of Sierra or the market price of MDLY Class A common stock before the MDLY Merger effective time, provided that the MDLY Merger is consummated by March 31, 2020, or, if consummated after March 31, 2020, only if the parties subsequently agree to extend the closing date on the same terms and conditions. In addition, on July 29, 2019, MCC and Sierra announced the execution of the Amended and Restated Agreement and Plan of Merger, dated as of July 29, 2019 (the “Amended MCC Merger Agreement”), by and between MCC and Sierra, pursuant to which MCC will, on the terms and subject to the conditions set forth in the Amended MCC Merger Agreement, merge with and into Sierra, with Sierra as the surviving company in the MCC Merger. In the MCC Merger, each share of MCC’s common stock (other than shares of MCC’s common stock held by MCC, Sierra or their respective wholly owned subsidiaries), will be exchanged for the right to receive (i) 0.68 shares of Sierra’s common stock if the attorneys’ fees of plaintiffs’ counsel and litigation expenses paid or incurred by plaintiffs’ counsel or advanced by plaintiffs in connection with the Delaware Action, as described below (such fees and expenses, the “Plaintiff Attorney Fees”) are less than or equal to $10,000,000 ; (ii) 0.66 shares of Sierra’s common stock if the Plaintiff Attorney Fees are equal to or greater than $15,000,000 ; (iii) between 0.68 and 0.66 per share of Sierra’s common stock if the Plaintiff Attorney Fees are greater than $10,000,000 but less than $15,000,000 , calculated on a descending basis, based on straight line interpolation between $10,000,000 and $15,000,000 ; or (iv) 0.66 shares of Sierra’s common stock in the event that the Plaintiff Attorney Fees are not fully and finally determined prior to the closing of the MCC Merger (such ratio, the “MCC Merger Exchange Ratio”). Based upon the Plaintiff Attorney Fees approved by the Court of Chancery of the State of Delaware (the “Delaware Court of Chancery”) as set forth in the Order and Final Judgment entered into on December 20, 2019, as described below (the “Delaware Order”), the MCC Merger Exchange Ratio will be 0.66 shares of Sierra’s common stock. MCC and Sierra are appealing the Delaware Order with respect to the Delaware Court of Chancery’s ruling on the Plaintiff Attorney Fees. Under the Amended MCC Merger Agreement, the MCC Merger exchange ratio is not subject to adjustment based on changes in the NAV of Sierra or the market price of MCC’s common stock before the MCC Merger effective time. In addition, under the Settlement (as described below), the defendant parties to the Settlement (other than the Company) shall, among other things, deposit or cause to be deposited the Settlement shares, the number of shares of which is to be calculated using the pro forma NAV of $6.37 per share as of June 30, 2019, and is not subject to subsequent adjustment based on changes in the NAV of Sierra or the market price of MCC’s common stock before the MCC Merger effective time, provided that the MCC Merger is consummated by March 31, 2020, or, if consummated after March 31, 2020, only if the parties subsequently agree to extend the closing date on the same terms and conditions. Pursuant to terms of the Amended MCC Merger Agreement, the consummation of the MCC Merger is conditioned upon the satisfaction or waiver of each of the conditions to closing under the Amended MDLY Merger Agreement and the consummation of the MDLY Merger. However, pursuant to the terms of the Amended MDLY Merger Agreement, the consummation of the MDLY Merger is not contingent upon the consummation of the MCC Merger. If both Mergers are successfully consummated, Sierra’s common stock would be listed on the NYSE, with such listing expected to be effective as of the closing date of the Mergers, and Sierra’s common stock will be listed on the Tel Aviv Stock Exchange, with such listing expected to be effective as of the closing date of the MCC Merger. If, however, only the MDLY Merger is consummated, Sierra’s common stock would be listed on the NYSE. If both Mergers are successfully consummated, the investment portfolios of MCC and Sierra would be combined, Merger Sub, as a successor to MDLY, would be a wholly owned subsidiary of Sierra (the "Combined Company"), and the Combined Company would be internally managed by MCC Advisors LLC, its wholly controlled adviser subsidiary. If only the MDLY Merger is consummated, while the investment portfolios of MCC and Sierra would not be combined, the investment management function relating to the operation of the Company, as the surviving company, would still be internalized (the “Sierra/MDLY Company”) and the Sierra/MDLY Company would be managed by MCC Advisors LLC. The Mergers are subject to approval by the stockholders of MDLY, Sierra, and MCC, regulators, including the SEC, court approval of the Settlement (as described below), other customary closing conditions and third-party consents. There is no assurance that any of the foregoing conditions will be satisfied. MDLY and Sierra have the right to terminate the Amended MDLY Merger Agreement under certain circumstances, including (subject to certain limitations set forth in the Amended MDLY Merger Agreement), among others: (i) by mutual written agreement of each party; (ii) any governmental entity whose consent or approval is a condition to closing set forth in Section 8.1 of the Amended MDLY Merger Agreement has denied the granting of any such consent or approval and such denial has become final and nonappealable, or any governmental entity of competent jurisdiction shall have issued a final and nonappealable order, injunction or decree permanently enjoining or otherwise prohibiting or making illegal the consummation of the transactions contemplated by the Amended MDLY Merger Agreement; (iii) the MDLY Merger has not closed on or prior to March 31, 2020; or (iv) either party has failed to obtain stockholder approval or the Amended MCC Merger Agreement has been terminated. Set forth below is a description of the Decision (as defined below), which should be read in the context of the impact of the Delaware Order and corresponding Settlement. On February 11, 2019, a purported stockholder class action related to the MCC Merger was commenced in the Delaware Court of Chancery by FrontFour Capital Group LLC and FrontFour Master Fund, Ltd. (together, "FrontFour"), captioned FrontFour Capital Group LLC, et al. v. Brook Taube et al., Case No. 2019-0100 (the “Delaware Action”) against defendants Brook Taube, Seth Taube, Jeff Tonkel, Mark Lerdal, Karin Hirtler-Garvey, John E. Mack, Arthur S. Ainsberg, MDLY, Sierra, MCC, MCC Advisors LLC, Medley Group LLC, and Medley LLC. The complaint, as amended on February 12, 2019, alleged that the individuals named as defendants breached their fiduciary duties to MCC’s stockholders in connection with the MCC Merger, and that MDLY, Sierra, MCC Advisors LLC, Medley Group LLC, and Medley LLC aided and abetted those alleged breaches of fiduciary duties. The complaint sought to enjoin the vote of MCC’s stockholders on the MCC Merger and enjoin enforcement of certain provisions of the MCC Merger Agreement. The Delaware Court of Chancery held a trial on the plaintiffs’ motion for a preliminary injunction and issued a Memorandum Opinion (the "Decision") on March 11, 2019. The Delaware Court of Chancery denied the plaintiffs’ requests to (i) permanently enjoin the MCC Merger and (ii) require MCC to conduct a “shopping process” for MCC on terms proposed by FrontFour in its complaint. The Delaware Court of Chancery held that MCC’s directors breached their fiduciary duties in entering into the MCC Merger, but rejected FrontFour’s claim that Sierra aided and abetted those breaches of fiduciary duties. The Delaware Court of Chancery ordered the defendants to issue corrective disclosures consistent with the Decision, and enjoined a vote of MCC’s stockholders on the MCC Merger until such disclosures had been made and stockholders had the opportunity to assimilate that information. On December 20, 2019, the Delaware Court of Chancery entered into the Delaware Order approving the settlement of the Delaware Action (the “Settlement”). Pursuant to the Settlement, MCC agreed to certain amendments to (i) the MCC Merger Agreement and (ii) the MDLY Merger Agreement, which amendments are reflected in the Amended MCC Merger Agreement and the Amended MDLY Merger Agreement. The Settlement also provides for, if the MCC Merger is consummated, the creation of a settlement fund, consisting of $17 million in cash and $30 million of Sierra's common stock, with the number of shares of Sierra's common stock to be calculated using the pro forma net asset value of $6.37 per share as of June 30, 2019, which will be distributed to eligible members of the Settlement Class (as defined in the Settlement). In addition, in connection with the Settlement, on July 29, 2019, MCC entered into a Governance Agreement with FrontFour Capital Group LLC, FrontFour Master Fund, Ltd., FrontFour Capital Corp., FrontFour Opportunity Fund, David A. Lorber, Stephen E. Loukas and Zachary R. George, pursuant to which, among other matters, FrontFour is subject to customary standstill restrictions and required to vote in favor of the revised MCC Merger at a meeting of stockholders to approve the revised MCC Merger Agreement. The Settlement also provides for mutual releases between and among FrontFour and the Settlement Class, on the one hand, and the Medley Parties, on the other hand, of all claims that were or could have been asserted in the Delaware Action through September 26, 2019. The Delaware Court of Chancery also awarded attorney’s fees as follows: (i) an award of $3,000,000 to lead plaintiffs’ counsel and $75,000 to counsel to plaintiff Stephen Altman (the “Therapeutics Fee Award”) and $420,334.97 of plaintiff counsel expenses payable to the lead plaintiff’s counsel, which were paid by MCC on December 23, 2019, and (ii) an award that is contingent upon the closing of the proposed merger transactions (the “Contingent Fee Award”), consisting of: a. $100,000 for the agreement by Sierra's board of directors to appoint one independent director of MCC who will be selected by the independent directors of Sierra on the board of directors of the post-merger company upon the closing of the Mergers; and b. the amount calculated by solving for A in the following formula: Award[A]=(Monetary Fund[M]+Award[A]-Look Through[L])*Percentage[P] Whereas A shall be the amount of the Additional Fee (excluding the $100,000 award for the agreement by Sierra's board of directors to appoint one independent director of MCC who will be selected by the independent directors of Sierra on the board of directors of the post-merger company upon the closing of the Mergers); M shall be the sum of (i) the $17 million cash component of the Settlement Fund and (ii) the value of the post-merger company stock component of the Settlement Fund, which shall be calculated as the product of the VPS (as defined below) and 4,709,576.14 (the number of shares of post-merger company’s stock comprising the stock component of the net settlement amount); L shall be the amount representing the estimated value of the decrease in shares to be received by eligible class members arising by operation of the change in the “Exchange Ratio” under the Amended MCC Merger Agreement, calculated as follows: L = ((ES * 68%) - (ES * 66%)) * VPS Where: ES shall be the number of eligible shares; VPS shall be the pro forma net asset value per share of the post-merger company’s common stock as of the closing as reported in the public disclosure filed nearest in time and after the closing (the “Closing NAV Disclosure”); and P shall equal 0.26 The Contingent Fee Award is contingent upon the closing of the MCC Merger. Payment of the Contingent Fee Award will be made in two stages. First, within five ( 5 ) business days of the establishment of the Settlement Fund, MCC or its successor shall (i) pay the plaintiffs’ counsel an estimate of the Contingent Fee Award (the “Additional Fee Estimate”), less twenty ( 20 ) percent (the “Additional Fee Estimate Payment”), and (ii) deposit the remaining twenty ( 20 ) percent of the Additional Fee Estimate into escrow (the “Escrowed Fee”). For purposes of calculating such estimate, MCC or its successor shall use the formula set above, except that VPS shall equal the pro forma net asset value of the post-merger company’s common stock as reported in the public disclosure filed nearest in time and prior to the closing (the “Closing NAV Estimate”). Second, within five ( 5 ) business days of the Closing NAV Disclosure (as defined in the Order and Final Judgment), (i) if the Additional Fee is greater than the Additional Fee Estimate Payment, an amount of the Escrowed Fee shall be released to plaintiffs’ counsel such that the total payments made to plaintiffs’ counsel equal the Additional Fee and the remainder of the Escrowed Fee, if any, shall be released to MCC or its successor, (ii) if the Additional Fee is less than the Additional Fee Estimate Payment, plaintiffs’ counsel shall return to MCC or its successor the difference between the Additional Fee Estimate and the Additional Fee and the Escrowed Fee shall be released to MCC or its successor, or (iii) if the Additional Fee is equal to the Additional Fee Estimate Payment, the Escrowed Fee shall be released to MCC or its successor. On January 17, 2020, MCC and Sierra filed a notice of appeal with the Delaware Supreme Court from those provisions of the Order and Final Judgment with respect to the Contingent Fee Award. Transaction expenses related to the MDLY Merger are included in the Company's general, administrative and other expenses and consist primarily of professional fees. Such expenses amounted to $4.6 million and $3.8 million for the years ending December 31, 2019 and 2018, respectively. There were no transaction expenses related to the MDLY Merger during the year ended December 31, 2017. Basis of Presentation The accompanying consolidated financial statements have been prepared on the accrual basis of accounting in conformity with U.S. generally accepted accounting principles (“GAAP”) and include the accounts of Medley LLC and its consolidated subsidiaries. Intercompany balances and transactions have been eliminated in consolidation. Reclassification of Prior Period Presentation Performance fee compensation reported in the prior period has been reclassified to compensation and benefits to conform to the current period presentation in the consolidated statements of operations. This reclassification had no effect on the reported results of operations. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation In accordance with Accounting Standards Codification (“ASC”) 810, Consolidation , the Company consolidates those entities where it has a direct and indirect controlling financial interest based on either a variable interest model or voting interest model. As such, the Company consolidates entities that the Company concludes are variable interest entities (“VIEs”), for which the Company is deemed to be the primary beneficiary and entities in which it holds a majority voting interest or has majority ownership and control over the operational, financial and investing decisions of that entity. For legal entities evaluated for consolidation, the Company must determine whether the interests that it holds and fees paid to it qualify as a variable interest in an entity. This includes an evaluation of the management fee and performance fee paid to the Company when acting as a decision maker or service provider to the entity being evaluated. If fees received by the Company are customary and commensurate with the level of services provided, and the Company does not hold other economic interests in the entity that would absorb more than an insignificant amount of the expected losses or returns of the entity, the interest that the Company holds would not be considered a variable interest. The Company factors in all economic interests including proportionate interests through related parties, to determine if fees are considered a variable interest. An entity in which the Company holds a variable interest is a VIE if any one of the following conditions exist: (a) the total equity investment at risk is not sufficient to permit the legal entity to finance its activities without additional subordinated financial support, (b) the holders of the equity investment at risk have the right to direct the activities of the entity that most significantly impact the legal entity’s economic performance, or (c) the voting rights of some investors are disproportionate to their obligation to absorb losses or rights to receive returns from a legal entity. For limited partnerships and other similar entities, non-controlling investors must have substantive rights to either dissolve the fund or remove the general partner (“kick-out rights”) in order to not qualify as a VIE. For those entities that qualify as a VIE, the primary beneficiary is generally defined as the party who has a controlling financial interest in the VIE. The Company is generally deemed to have a controlling financial interest if it has the power to direct the activities of a VIE that most significantly impact the VIE’s economic performance, and the obligation to absorb losses or receive benefits from the VIE that could potentially be significant to the VIE. The Company determines whether it is the primary beneficiary of a VIE at the time it becomes initially involved with the VIE and reconsiders that conclusion continuously. The primary beneficiary evaluation is generally performed qualitatively on the basis of all facts and circumstances. However, quantitative information may also be considered in the analysis, as appropriate. These assessments require judgment. Each entity is assessed for consolidation on a case-by-case basis. For those entities evaluated under the voting interest model, the Company consolidates the entity if it has a controlling financial interest. The Company has a controlling financial interest in a voting interest entity (“VOE”) if it owns a majority voting interest in the entity. Consolidated Variable Interest Entities As of December 31, 2019 , Medley LLC had seven subsidiaries, Medley Seed Funding I LLC, Medley Seed Funding II LLC, STRF Advisors LLC, Medley Caddo Investors Holdings 1 LLC, Medley Avantor Investors LLC, Medley Cloverleaf Investors LLC and Medley Real D Investors LLC, which are consolidated VIEs. Each of these entities was organized as a limited liability company and was legally formed to either manage a designated fund or to strategically invest capital as well as isolate business risk. As of December 31, 2019 , total assets and total liabilities, after eliminating entries, of these VIEs reflected in the consolidated balance sheets were $1.2 million and less than $0.1 million , respectively. As of December 31, 2018, Medley LLC had five majority owned subsidiaries, Medley Seed Funding I LLC, Medley Seed Funding II LLC, STRF Advisors LLC, Medley Caddo Investors Holdings 1 LLC and Medley Avantor LLC. As of December 31, 2018 , total assets and total liabilities, after eliminating entries, of these VIEs reflected in the consolidated balance sheets were $22.6 million and less than $0.1 million , respectively. Except to the extent of the assets of these VIEs that are consolidated, the holders of the consolidated VIEs’ liabilities generally do not have recourse to the Company. Seed Investments The Company accounts for seed investments through the application of the voting interest model under ASC 810-10-25-1 through 25-14 and consolidates a seed investment when the investment advisor holds a controlling interest, which is, in general, 50% or more of the equity in such investment. For seed investments in which the Company does not hold a controlling interest, the Company accounts for such seed investment under the equity method of accounting, at its ownership percentage of such seed investment’s net asset value. The Company seed funded $2.1 million to Sierra Total Return Fund ("STRF"), which commenced investment operations in June 2017. As of and since inception through December 31, 2019 , the Company owned 100% of the equity of STRF and, as such, consolidates STRF in its consolidated financial statements. The condensed balance sheet of STRF as of December 31, 2019 and 2018 is presented in the table below. As of December 31, 2019 2018 Assets (in thousands) Cash and cash equivalents $ 682 $ 274 Investments, at fair value 1,441 1,952 Other assets 29 248 Total assets $ 2,152 $ 2,474 Liabilities and Equity Accounts payable, accrued expenses and other liabilities $ 342 $ 330 Equity 1,810 2,144 Total liabilities and equity $ 2,152 $ 2,474 As of December 31, 2019 , the Company's consolidated balance sheet reflects the elimination of $0.2 million of other assets and $1.8 million of equity as a result of the consolidation of STRF. As of December 31, 2018, the Company's consolidated balance sheet reflects the elimination of $0.2 million of other assets, $0.1 million of accrued expenses and other liabilities and $2.1 million of equity as a result of the consolidation of STRF. During the year ended December 31, 2019, 2018, and 2017 this fund did not generate any significant income or losses from operations. In October 2019, a former minority interest holder exercised its put option right on its interest in MSF I and MSF II, which will result in the majority of the STRF shares held by the Company to be transferred to that minority interest and the Company will no longer consolidate STRF in its consolidated financial statements. This share transfer is expected to take place by the end of the first quarter ending March 31, 2020 (Notes 11 and 16). Non-Consolidated Variable Interest Entities The Company holds interests in certain VIEs that are not consolidated because the Company is not deemed to be the primary beneficiary. The Company's interest in these entities is in the form of insignificant equity interests and fee arrangements. The maximum exposure to loss represents the potential loss of assets by the Company relating to these non-consolidated entities. As of December 31, 2019 , the Company recorded investments, at fair value, attributed to these non-consolidated VIEs of $3.0 million , receivables of $1.3 million included as a component of other assets and a clawback obligation of $7.2 million included as a component of accounts payable, accrued expenses and other liabilities on the Company’s consolidated balance sheets. As of December 31, 2018 , the Company recorded investments, at fair value, attributed to non-consolidated VIEs of $4.2 million , receivables of $1.8 million included as a component of other assets and a clawback obligation of $7.2 million included as a component of accounts payable, accrued expenses and other liabilities on the Company’s consolidated balance sheets. As of December 31, 2019 , the Company’s maximum exposure to losses from these entities is $4.4 million . Concentration of Credit and Market Risk In the normal course of business, the Company's underlying funds encounter significant credit and market risk. Credit risk is the risk of default on investments in debt securities, loans and derivatives that result from a borrower's or derivative counterparty's inability or unwillingness to make required or expected payments. Credit risk is increased in situations where the Company's underlying funds are investing in distressed assets or unsecured or subordinate loans or in securities that are a material part of its respective business. Market risk reflects changes in the value of investments due to changes in interest rates, credit spreads or other market factors. The Company's underlying funds may make investments outside of the United States. These non-U.S. investments are subject to the same risks associated with U.S. investments, as well as additional risks, such as fluctuations in foreign currency exchange rates, unexpected changes in regulatory requirements, heightened risk of political and economic instability, difficulties in managing the investments, potentially adverse tax consequences, and the burden of complying with a wide variety of foreign laws. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Management’s estimates are based on historical experience and other factors, including expectations of future events that management believes to be reasonable under the circumstances. These assumptions and estimates also require management to exercise judgment in the process of applying the Company’s accounting policies. Significant estimates and assumptions by management affect the carrying value of investments, deferred tax assets, performance compensation payable and certain accrued liabilities. Actual results could differ from these estimates, and such differences could be material. Indemnification In the normal course of business, the Company enters into contractual agreements that provide general indemnifications against losses, costs, claims and liabilities arising from the performance of individual obligations under such agreements. The Company has not experienced any prior claims or payments pursuant to such agreements. The Company’s individual maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Company that have not yet occurred. However, based on management’s experience, the Company expects the risk of loss to be remote. Non-Controlling Interests in Consolidated Subsidiaries Non-controlling interests in consolidated subsidiaries represent the component of equity in such consolidated entities held by third-parties and certain employees. These interests are adjusted for contributions to and distributions from Medley entities and are allocated income or loss from Medley entities based on their ownership percentages. Redeemable Non-Controlling Interests Redeemable non-controlling interests represents interests of certain third parties that are not mandatorily redeemable but redeemable for cash or other assets at a fixed or determinable price or a fixed or determinable date, at the option of the holder or upon the occurrence of an event that is not solely within the control of the Company. These interests are classified in the mezzanine section on the Company's consolidated balance sheets. Cash and Cash Equivalents Cash and cash equivalents include liquid investments in money market funds and demand deposits. The Company had cash balances with financial institutions in excess of Federal Deposit Insurance Corporation insured limits as of December 31, 2019 and 2018. The Company monitors the credit standing of these financial institutions and has not experienced, and has no expectations of experiencing, any losses with respect to such balances. Investments Investments include equity method investments that are not consolidated but over which the Company exerts significant influence. The Company measures the carrying value of its privately-held equity method investments by recording its share of the earnings or losses of its investee in the periods for which they are reported by the investee in the investee's financial statements rather than in the period in which an investee declares a dividend or distribution. For the Company's public non-traded equity method investment, it measures the carrying value of such investment at Net Asset Value ("NAV") per share. Unrealized appreciation (depreciation) resulting from changes in fair value of the equity method investments is reflected as a component of investment income in the consolidated statements of operations along with the income and expense allocations from such investments. The carrying amounts of equity method investments are reflected in Investments, at fair value on the Company's consolidated balance sheets. As the underlying entities that the Company manages and invests in are, for U.S. GAAP purposes, primarily investment companies which reflect their investments at estimated fair value, the carrying value of the Company’s equity method investments in such entities approximates fair value. The Company evaluates its equity-method investments for impairment whenever events or changes in circumstances indicate that the carrying amounts of such investments may not be recoverable. For presentation in its consolidated statements of cash flows, the Company treats distributions received from certain equity method investments using the cumulative earnings approach. Under the cumulative earnings approach, an investor would compare the distributions received to its cumulative equity-method earnings since inception. Any distributions received up to the amount of cumulative equity earnings would be considered a return on investment and classified in operating activities. Any excess distributions would be considered a return of investment and classified in investing activities. Investments also include publicly traded common stock. The Company measures the fair value of its publicly traded common stock at the quoted market price on the primary market or exchange on which the underlying shares trade. Any realized gains (losses) from the sale of investments and unrealized appreciation (depreciation) resulting from changes in fair value are recorded in other income (expense), net. Investments of Consolidated Fund In accordance with ASC 820, Fair Value Measurements and Disclosures , the Company's consolidated fund has categorized its investments carried at fair value, based on the priority of the valuation technique, into a three-level fair value hierarchy as discussed in Note 5. Fair value is a market-based measure considered from the perspective of the market participant who holds the financial instrument rather than an entity specific measure. Investments for which market quotations are readily available are valued at such market quotations, which are generally obtained from an independent pricing service or multiple broker-dealers or market makers. The consolidated fund weighs the use of third-party broker quotations, if any, in determining fair value based on management's understanding of the level of actual transactions used by the broker to develop the quote and whether the quote was an indicative price or binding offer. However, debt investments with remaining maturities within 60 days that are not credit impaired are valued at cost plus unamortized discount, or minus amortized premium, which approximates fair value. Investments for which market quotations are not readily available are valued at fair value as determined by the consolidated fund’s board of trustees based upon input from management and third party valuation firms. Because these investments are illiquid and because there may not be any directly comparable companies whose financial instruments have observable market values, these loans are valued using a fundamental valuation methodology, consistent with traditional asset pricing standards, that is objective and consistently applied across all loans and through time. Fixed Assets Fixed assets consist primarily of furniture and fixtures, computer equipment, and leasehold improvements and are recorded at cost, less accumulated depreciation and amortization. The Company calculates depreciation expense for furniture and fixtures, and computer equipment using the straight-line method over the estimated useful life used for the respective assets, which generally ranges from three to seven years. Amortization of leasehold improvements is provided on a straight-line basis over the shorter of the remaining term of the underlying lease or estimated useful life of the improvement. Useful lives of leasehold improvements range from three to eight years. Expenditures for major additions and improvements are capitalized, while minor replacements, maintenance and repairs are charged to expense as incurred. When property is retired or otherwise disposed of, the cost and accumulated depreciation are removed from accounts and any resulting gain or loss is reflected in Other income (expense), net in the Company's consolidated statements of operations. Debt Issuance Costs Debt issuance costs represent direct costs incurred in obtaining financing and are amortized over the term of the underlying debt using the effective interest method. Debt issuance costs associated with the Company’s revolving credit facility are presented as a deferred charge and are included as a component of other assets on the Company's consolidated balance sheets. Debt issuance costs associated with the Company’s senior unsecured debt are presented as a direct reduction in the carrying value of such debt, consistent with the presentation of debt discount. Amortization of debt issuance costs is included as a component of interest expense in the Company's consolidated statement of operations. Revenues Effective January 1, 2018, the Company recognizes revenue in accordance with ASC 606, Revenues from Contracts with Customers . The Company recognizes revenue under the core principle of depicting the transfer of promised goods or services to customers in an amount that reflects the consideration to which it expects to be entitled in exchange for such goods or services. To achieve this, the Company applies a five step approach: (1) identify the contract(s) with a customer, (2) identify the performance obligations within the contract, (3) determine the transaction price, (4) allocate the transaction price to the separate performance obligations and (5) recognize revenue when, or as, each performance obligation is satisfied. Carried interest are performance based fees that represent a capital allocation of income to the general partner or investment manager. Such fees are accounted for under ASC 323, Investments - Equity Method and Joint Ventures and, therefore, are not in the scope of ASC 606. As a result of the adoption of this new revenue guidance, the Company recorded a cumulative effect decrease to equity of $3.6 million , net of benefit from income taxes of $0.1 million , as of January 1, 2018, which relates to (1) certain performance fee revenue that would not have met the “probable that significant reversal will not occur” criteria of $3.0 million and (2) the reversal of reimbursable fund formation costs which were deferred on the Company’s consolidated balance sheet of $0.7 million . Management Fees Medley provides investment management services to both public and private investment vehicles. Management fees include base management fees, other management fees, and Part I incentive fees, as described below. Base management fees are calculated based on either (i) the average or ending gross assets balance for the relevant period, (ii) limited partners’ capital commitments to the funds, (iii) invested capital, (iv) NAV or (v) lower of cost or market value of a fund’s portfolio investments. Depending upon the contracted terms of the investment management agreement, management fees are paid either quarterly in advance or quarterly in arrears, and are recognized as earned over the period the services are provided. Certain management agreements provide for Medley to receive other management fee revenue derived from up front origination fees paid by the funds' and/or separately managed accounts' underlying portfolio companies. These fees are recognized when the Company becomes entitled to such fees. Certain management agreements also provide for Medley to receive Part I incentive fee revenue derived from net investment income (excluding gains and losses) above a hurdle rate. As it relates to MCC, these fees are subject to netting against realized and unrealized losses. Part I incentive fees are paid quarterly and are recognized as earned in the period the services are provided. Performance Fees Performance fees are contractual fees which do not represent a capital allocation of income to the general partner or investment manager that are earned based on the performance of certain funds, typically, the Company’s separately managed accounts. Performance fees are earned based on each fund's performance during the period, subject to the achievement of minimum return levels in accordance with the respective terms set out in each fund’s investment management agreement. Other Revenues and Fees Medley provides administrative services to certain affiliated funds and is reimbursed for direct and allocated expenses incurred in providing such administrative services, as set forth in the respective underlying agreements. These fees are recognized as revenue in the period administrative services are rendered. Medley also acts as the administrative agent on certain deals for which Medley may earn loan administration fees and transaction fees. Medley may also earn consulting fees for providing non-advisory services related to its managed funds. These fees are recognized as revenue over the period the services are performed. Investment Income (loss) - Carried Interest Carried interest are performance based fees that represent a capital allocation of income to the general partner or investment manager. Carried interest are allocated to the Company based on cumulative fund performance to date, subject to the achievement of minimum return levels in accordance with the respective terms set out in each fund’s governing documents and are accounted for under the equity method of accounting . Accordingly, these performance fees are reflected as carried interest within investment income on the Company's consolidated statements of operations and balances due for such fees are included as a part of equity method investments within Investments, at fair value on the Company's consolidated balance sheets. The Company records carried interest based upon an assumed liquidation of that fund's net assets as of the reporting date, regardless of whether such amounts have been realized. For any given period, carried interest on the Company's consolidated statements of operations may include reversals of previously recognized carried interest due to a decrease in the value of a particular fund that results in a decrease of cumulative fees earned to date. Since fund return hurdles are cumulative, previously recognized carried interest also may be reversed in a period of appreciation that is lower than the particular fund's hurdle rate. Carried interest received in prior peri ods may be required to be returned by the Company in future periods if the funds’ investment performance declines below certain levels. Each fund is considered separately in this regard and, for a given fund, carried interest can never be negative over the life of a fund. If upon a hypothetical liquidation of a fund’s investments, at their then current fair values, previously recognized and distributed carried interest would be required to be returned, a liability is established for the potential clawback obligatio n. During the year ended December 31, 2019, the Company received a carried interest distribution of $0.3 million from one of its managed funds, which has been fully liquidated as of December 31, 2019. Prior to the receipt of this distribution, the C ompany had not received any carried interest distributions, except for tax distributions related to the Company’s allocation of net income, which included an allocation of carried interest. Pursuant to the organizational documents of each respective fund, a portion of these tax distributions may be subject to clawback. As of December 31, 2019 and 2018, the Company had accrued $7.2 million for clawback obligations that would need to be paid if the funds were liquidated at fair value as of the end of the reporting period. The Company’s actual obligation, however, would not become payable or realized until the end of a fund’s life. For each of the years ended December 31, 2019 , 2018 and 2017, the Company's reversal of previously recognized carried interest were not in excess of $0.1 million . Investment Income (loss) - Other Other investment income is comprised of unrealized appreciation (depreciation) resulting from changes in fair value of the Company's equity method investments in addition to the income and expense allocations from such investments. Stock-based Compensation Stock-based compensation expense relating to equity based awards are measured at fair value as of the grant date, reduced for actual forfeitures in the period they occur, and expensed over the requisite service period on a straight-line basis as a component of compensation and benefits on the Company's consolidated statements of operations. Income Taxes The Company is treated as a partnership for income tax purposes and is therefore not subject to U.S. federal, state or local income taxes since all income, gains and losses are passed through to its members. However, a portion of taxable income from Medley LLC and its subsidiaries are subject to New York City's unincorporated business tax, which is included in the Company's provision for income taxes. The Company accounts for income taxes using the asset and liability approach, which requires the recognition of tax benefits or expenses for temporary differences between the financial reporting and tax basis of assets and liabilities. A valuation allowance is established when necessary to reduce deferred tax assets to the amounts expected to be realized. The Company also recognizes a tax benefit from uncertain tax positions only if it is “more likely than not” that the position is sustainable based on its technical merits. The Company’s policy is to recognize interest and penalties on uncertain tax positions and other tax matters as a component of its provision for income taxes. For interim periods, the Company accounts for income taxes based on its estimate of the effective tax rate for the year. Discrete items and changes in its estimate of the annual effective tax rate are recorded in the period in which they occur. Recently Issued Accounting Pronouncements Adopted as of January 1, 2019 In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) to increase the transparency and comparability among organizations as it relates to lease assets and lease liabilities, by requiring lessees to recognize a right-of-use asset and lease liability for all leases with an expected term of more than 12 months. Effective January 1, 2019, the Company adopted this guidance using a modified retrospective approach, which was required for all leases that exist at or commence after the date of the initial application with an option to use certain practical expedients. The Company has elected to use these practical expedients, which allow the Company to treat lease and non-lease components of its leases as a single component, have the ability to use hindsight in determining the lease term and assessing impairment of right-of-use assets, not to reassess lease classification or whether an arrangement is or contains a lease and not to reassess its initial accounting for direct lease costs. The adoption of the new lease standard at January 1, 2019 resulted in the recognition of right-of-use assets and lease liabilities of $8.2 million and $10.2 million , respectively, consisting primarily of operating leases related to the rental of office space. The adoption of this guidance did not have a significant impact on the Company's consolidated statements of operations or cash flows. Additionally, this adoption did not impact any covenants associated with the Company's financial obligations. Recently Issued Accounting Pronouncements Not Yet Adopted In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework –Changes to the Disclosure Requirements for Fair Value Measurement . This ASU modifies the disclosure requirements in Topic 820, Fair Value Measurement , by removing certain disclosure requirements related to the fair value hierarchy, modifying existing disclosure requirements related to measurement uncertainty, and adding new disclosure requirements. This ASU is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted. The Company adopted this ASU effective January 1, 2020 and its adoption is not expected to have a material impact on the Company's consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments . The amendments in this ASU require the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts and requires enhanced disclosures related to the significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of an organization’s portfolio. In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. The amendments in this ASU are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. This ASU is effective for the Company on January 1, 2021 and will be adopted prospectively. The Company does not expect the adoption of this ASU to have a material impact on its consolidated financial statements. In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (a consensus of the FASB Emerging Issues Task Force). This ASU aligns the accounting for costs incurred to implement a cloud computing arrangement that is a service arrangement with the guidance on capitalizing costs associated with developing or obtaining internal-use software. It addresses when costs should be capitalized rather than expensed, the term to use when amortizing capitalized costs, and how to evaluate the unamortized portion of these capitalized implementation costs for impairment. This ASU also includes guidance on how to present implementation costs in the financial statements and creates additional disclosure requirements. The accounting for the service element of a hosting arrangement that is a service contract is not affected by these amendments. Early adoption is permitted and can be applied either retrospectively or prospectively. The Company adopted this ASU on January 1, 2020 and has applied this new ASU on a prospective basis. The Company does not expect the adoption of this ASU to have a material impact on its consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes . The guidance in th |
REVENUES FROM CONTRACTS WITH CU
REVENUES FROM CONTRACTS WITH CUSTOMERS | 12 Months Ended |
Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenues from Contracts with Customers | REVENUES FROM CONTRACTS WITH CUSTOMERS The majority of the Company's revenues are derived from investment management and advisory contracts that are accounted for in accordance with ASC 606. Performance Obligations Performance obligations are the unit of account under the revenue recognition standard and represent the distinct goods or services that are promised to the customer. The majority of the Company's contracts have a single performance obligation to provide asset management, advisory and other related services to permanent capital vehicles, long-dated private funds and separately managed accounts. The Company also has a separate performance obligation to act as an agent for certain third party lenders and provide loan administration services to certain borrowers. These loan administration services also represent a single performance obligation. The Company primarily provides investment management services to a fund by managing the fund’s investments and maximizing returns on those investments. The Company’s asset management, advisory and other related services are transferred over time to the customer on a day-to-day basis. The contracts with each fund create a distinct performance obligation for each quarter the Company provides the promised services to the customer, from which the customer can benefit from each individual quarter of service. Furthermore, each quarter of the promised services is considered separately identifiable because there is no integration of the promised services between quarters, each quarter does not modify services provided prior to that quarter, and the services provided are not interdependent or interrelated. Most services provided to these funds are provided continuously over the contract period, so the services in the contract generally represent a single performance obligation comprising a series of distinct service periods. A contract’s transaction price is allocated to the series of distinct services that constitute a single performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. The management fees earned by the Company are largely dependent on fluctuations in the market and, thus, the determination of such fees is highly susceptible to factors outside the Company's influence. Management fees typically have a large number and broad range of possible consideration amounts and historical experience is generally not indicative of future performance of the market. Hence, the Company is applying the exemption provided under the new revenue recognition guidance as the Company is unable to estimate the aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied and the variable consideration is allocated entirely to a wholly unsatisfied performance obligation. Reimbursement of certain expenses incurred on behalf of the Company's funds are reported on a gross basis on the statements of operations if the Company is determined to be acting as the principal in those transactions. Significant Judgments The Company's contracts with customers generally include a single performance obligation to provide asset management, advisory and other related services on a quarterly basis. Revenues are recognized as such performance obligation is satisfied and the constraint on the management fees is lifted on a quarterly basis, hence, the Company does not need to exercise significant judgments in regards to management fees. Consideration for management fees is received on a quarterly basis as the performance obligations are satisfied. With respect to performance fees based on the economic performance of its SMAs, significant judgment is required when determining recognition of revenues. Such judgments include: • whether the fund is near final liquidation • whether the fair value of the remaining assets in the fund is significantly in excess of the threshold at which the Company would earn an incentive fee • the probability of significant fluctuations in the fair value of the remaining assets • whether the SMA’s remaining investments are under contract for sale with contractual purchase prices that would result in no clawback and it is highly likely that the contracts will be consummated As such, the Company will consider the above factors at each reporting period to determine whether there is an amount of the SMA performance fees which should be recognized as revenue because it is probable that there will not be a significant future revenue reversal, hence, the “constraint” on the performance fees has been lifted. The Company accounts for performance fees which represent capital allocations to the general partner or investment manager pursuant to accounting rules relating to investments accounted for under the equity method of accounting. As such, these types of performance fees are not within the scope of the new revenue recognition standard and the above significant judgments and constraints do not apply to them. Refer to Note 2, “ Summary of Significant Accounting Policies ”, and Note 4, “ Investments ”, for additional information. Revenue by Category The following table presents the Company's revenue from contracts with customers disaggregated by type of customer for the years ended December 31, 2019 and 2018: Permanent Long-dated SMAs Other Total For the year ended December 31, 2019 (in thousands) Management fees $ 27,208 $ 6,641 $ 5,624 $ — $ 39,473 Other revenues and fees 6,325 — — 3,378 9,703 Total revenues from contracts with customers $ 33,533 $ 6,641 $ 5,624 $ 3,378 $ 49,176 For the year ended December 31, 2018 Management fees $ 32,471 $ 8,122 $ 6,492 $ — $ 47,085 Other revenues and fees 6,895 — — 3,608 10,503 Total revenues from contracts with customers $ 39,366 $ 8,122 $ 6,492 $ 3,608 $ 57,588 The Other revenues and fees balances above primarily consist of: (i) revenues earned by Medley while serving as loan administrative agent on certain deals, including loan administration fees and transaction fees, (ii) reimbursable origination and deal expenses, (iii) reimbursable entity formation and organizational expenses and (iv) consulting fees for providing non-advisory services related to one of our managed funds. The Company's asset management, advisory and other related services are transferred over time and the Company recognizes these revenues over time as well. Contract Balances For certain customers, the Company has a performance obligation to provide loan administration services. The timing of revenue recognition may differ from the timing of invoicing to such customers or receiving consideration. For the majority of these services cash deposits are received prior to the performance obligation being met. The performance obligation of acting as a loan administrator is satisfied over time, therefore, the Company defers any payments received upfront as deferred revenue and recognizes revenue on a pro-rata basis over time as the loan administrative services are performed. These contract liabilities are reported as deferred revenue within accounts payable, accrued expenses and other liabilities on the Company's consolidated balance sheets and amounted to $0.2 million and $0.3 million as of December 31, 2019 and 2018, respectively. During the years ended December 31, 2019 and 2018, the Company recognized revenue from amounts included in deferred revenue of $0.7 million for each of the years then ended, and received cash deposits of $0.5 million and $0.8 million , respectively. The Company did no t have any contract assets as of December 31, 2019 or 2018. Assets Recognized for the Costs to Obtain or Fulfill a Contract As part of providing investment management services to a fund, the Company might incur certain placement fees to third parties for obtaining new investors for the fund. Any placement fees incurred to third party placement agents for placing investors into a fund are variable as it is based on a percentage of future fees and cannot be reasonably estimated. The Company determined that placement fees which are paid in cash over time as fees are earned, do not relate to a new contract at the time the payment is made. These costs do not represent a cost to obtain a new contract but rather a cost to fulfill an existing contract. The Company does not recognize any assets for the incremental costs of obtaining or fulfilling a contract with a customer and expenses placement fees as incurred. |
INVESTMENTS
INVESTMENTS | 12 Months Ended |
Dec. 31, 2019 | |
Schedule of Investments [Abstract] | |
Investments | INVESTMENTS Investments consist of the following: As of December 31, 2019 2018 (in thousands) Equity method investments, at fair value $ 11,650 $ 13,422 Investment in shares of MCC, at fair value — 20,633 Investment held at cost less impairment 196 418 Investments of consolidated fund 1,441 1,952 Total investments, at fair value $ 13,287 $ 36,425 Equity Method Investments Medley measures the carrying value of its public non-traded equity method investment in Sierra Income Corporation (“SIC” or “Sierra”), a related party, at NAV per share. Unrealized appreciation (depreciation) resulting from changes in NAV per share is reflected as a component of other investment loss, net on the Company's consolidated statements of operations. The carrying value of the Company’s privately-held equity method investments is determined based on the amounts invested by the Company plus the equity in earnings or losses of the investee allocated based on the respective underlying agreements, less distributions received. The Company evaluates its equity method investments for impairment whenever events or changes in circumstances indicate that the carrying amounts of such investments may not be recoverable. There were no impairment losses recorded during the years ended December 31, 2019, 2018 and 2017. The Company's equity method investment in shares of Sierra were $6.4 million and $7.4 million as of December 31, 2019 and 2018, respectively. The remaining balance as of December 31, 2019 and 2018 relates primarily to the Company’s investments in Medley Opportunity Fund II, LP (“MOF II”), Medley Opportunity Fund III LP (“MOF III”), Medley Opportunity Fund Offshore III LP (“MOF III Offshore”) and Aspect-Medley Investment Platform B LP (“Aspect B”). For performance fees earned which represent a capital allocation to the general partner or investment manager, the Company accounts for them under the equity method of accounting . As of December 31, 2019 and 2018, the balance due to the Company for such performance fees was $0.9 million and $0.4 million , respectively. Revenues associated with these performance fees are classified as carried interest within investment income on the Company's consolidated statements of operations. The entities in which the Company's investments are accounted for under the equity method are considered to be related parties. Investments in shares of MCC, at fair value Investments in shares of MCC were carried at fair value based upon the quoted market price on the exchange on which the shares are traded. As of December 31, 2018 and 2017, the Company held 7,756,938 shares of MCC. In October 2019, all of the shares were distributed to a former minority interest holder of the entity in which the shares were held as a result of the exercise of the former minority interest holder's put option right (Notes 11 and 16). During the years ended December 31, 2019 and 2018, the Company recognized unrealized losses of $4.1 million and $19.9 million , respectively, which are included as a component of other income (expenses), net on the Company’s consolidated statements of operations. Prior to the adoption of ASU 2016-01 on January 1, 2018, the Company's investment in shares of MCC were classified as available-for-sale securities, with cumulative unrealized gains (losses) recorded in other comprehensive income (loss). During the year ended December 31, 2017, the Company recorded unrealized losses of $11.1 million , respectively, as a component of other comprehensive income. Investment Held at Cost Less Impairment The Company measures its investment in CK Pearl Fund, LP at cost less impairment, adjusted for observable price changes for an identical or similar investment of the same issuer as well as any distributions received during the period. The carrying amount of this investment was $0.2 million and $0.4 million as of December 31, 2019 and 2018, respectively. The Company performs a quantitative and qualitative assessment at each reporting date to determine whether the investment is impaired and an impairment loss equal to the difference between the carrying value and fair value is recorded within other income (expenses), net on the Company's consolidated statement of operations if an impairment has been determined. There were no impairment losses recorded during the years ended December 31, 2019 and 2017. During the year ended December 31, 2018, the Company recorded a $0.1 million impairment loss on its investment in CK Pearl, which is included as a component of other income (expense), net on the consolidated statements of operations. Investments of consolidated fund Medley measures the carrying value of investments held by its consolidated fund at fair value. As of December 31, 2019 , investments held by the Company's consolidated fund consisted of $0.2 million of equity investments and $1.3 million of senior secured loans. As of December 31, 2018, investments of the consolidated fund consisted of $0.4 million of equity investments and $1.6 million of senior secured loans. Refer to Note 5, Fair Value Measurements, for additional information. Significant equity method investments In accordance with Rules 3-09 and 4-08(g) of Regulation S-X, the Company must assess whether any of its equity method investments are significant equity method investments. In evaluating the significance of these investments, the Company performed the income test, the investment test and the asset test described in S-X 3-05 and S-X 1-02(w). Rule 3-09 of Regulation S-X requires separate audited financial statements of an equity method investee in an annual report if either the income or investment test exceeds 20%. Rule 4-08(g) of Regulation S-X requires summarized financial information in an annual report if any of the three tests exceeds 10%, or 20% in the case of smaller reporting companies. Under the asset test, the Company’s proportionate share of its equity method investees' aggregated assets exceeded the applicable threshold of 20% for smaller reporting companies, and the Company has determined to hold significant equity method investments and is required to provide summarized financial information for these investees for all periods presented in this Form 10-K. The Company believes that the financial captions below are the most meaningful given that the investees are investment companies. The following table provides summarized balance sheet information for the Company's equity method investees, as of December 31, 2019 and 2018. As of December 31, 2019 2018 Balance Sheet Data (in thousands) Investments, at fair value $ 1,020,709 $ 1,417,176 Cash 255,738 97,889 Other assets 37,139 57,677 Total assets $ 1,313,586 $ 1,572,742 Debt $ 338,988 $ 367,424 Other liabilities 13,775 20,686 Total liabilities 352,763 388,110 Net assets $ 960,823 $ 1,184,632 The following table provides summarized income statement information for the Company's equity method investees, for the years ended December 31, 2019, 2018 and 2017. For the Years Ended December 31, 2019 2018 2017 Summary of Operations (in thousands) Total revenues $ 110,877 $ 142,431 $ 162,386 Total expenses 59,684 64,339 64,517 Net realized and unrealized gain/(loss) on investments (104,228 ) (131,554 ) (89,508 ) Net income (loss) $ (53,035 ) $ (53,462 ) $ 8,361 |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | FAIR VALUE MEASUREMENTS Fair value is the price that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Where available, fair value is based on observable market prices or parameters, or derived from such prices or parameters. Where observable prices or inputs are not available, valuation models are applied. These valuation models involve some level of management estimation and judgment, the degree of which is dependent on the price transparency for the instruments or market and the instruments’ complexity. The Company’s fair value analysis includes an analysis of the value of any unfunded loan commitments. Financial investments recorded at fair value in these consolidated financial statements are categorized for disclosure purposes based upon the level of judgment associated with the inputs to the valuation of the investment as of the measurement date. Investments which are valued using NAV as a practical expedient are excluded from this hierarchy: • Level I – Valuations based on quoted prices in active markets for identical assets or liabilities at the measurement date. • Level II – Valuations based on inputs other than quoted prices in active markets included in Level I, which are either directly or indirectly observable at the measurement date. This category includes quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in non-active markets including actionable bids from third parties for privately held assets or liabilities, and observable inputs other than quoted prices such as yield curves and forward currency rates that are entered directly into valuation models to determine the value of derivatives or other assets or liabilities. • Level III – Valuations based on inputs that are unobservable and where there is little, if any, market activity at the measurement date. The inputs for the determination of fair value may require significant management judgment or estimation and are based upon management’s assessment of the assumptions that market participants would use in pricing the assets and liabilities. These investments include debt and equity investments in private companies or assets valued using the Market or Income Approach and may involve pricing models whose inputs require significant judgment or estimation because of the absence of any meaningful current market data for identical or similar investments. The inputs in these valuations may include, but are not limited to, capitalization and discount rates, beta and EBITDA multiples. The information may also include pricing information or broker quotes which include a disclaimer that the broker would not be held to such a price in an actual transaction. The non-binding nature of consensus pricing and/or quotes accompanied by disclaimer would result in classification as Level III information, assuming no additional corroborating evidence. The following tables summarize the fair value hierarchy of the Company's financial assets and liabilities measured at fair value: As of December 31, 2019 Level I Level II Level III Total Assets (in thousands) Investments of consolidated fund $ 110 $ — $ 1,331 $ 1,441 Total Assets $ 110 $ — $ 1,331 $ 1,441 Liabilities Due to DB Med Investors (Note 11) $ — $ — $ 1,750 $ 1,750 Total Liabilities $ — $ — $ 1,750 $ 1,750 As of December 31, 2018 Level I Level II Level III Total Assets (in thousands) Investments of consolidated fund $ 258 $ — $ 1,694 $ 1,952 Investment in shares of MCC 20,633 — — 20,633 Total Assets $ 20,891 $ — $ 1,694 $ 22,585 Included in investments of consolidated fund as of December 31, 2019 are Level I assets of $0.1 million in equity investments and Level III assets of $1.3 million , which consists of senior secured loans and equity investments. Included in investments of consolidated fund as of December 31, 2018 are Level I assets of $0.3 million in equity investments and Level III assets of $1.7 million , which consists of senior secured loans and preferred equity investments. The significant unobservable inputs used in the fair value measurement of Level III assets of the consolidated fund's investments in senior secured loans include market yields. Significant increases or decreases in market yields in isolation would result in a significantly higher or lower fair value measurement. There were no significant unrealized gains or losses related to the investments of consolidated fund for the years ended December 31, 2019, 2018 and 2017. The following is a summary of changes in fair value of the Company's financial assets and liabilities that have been categorized within Level III of the fair value hierarchy: Level III Financial Assets as of December 31, 2019 Balance at December 31, 2018 Purchases Transfers In or (Out) of Level III Realized and Unrealized Depreciation Sale of Level III Assets Balance at December 31, 2019 (in thousands) Investments of consolidated fund $ 1,694 539 — (125 ) (777 ) $ 1,331 Level III Financial Assets as of December 31, 2019 Balance at December 31, 2018 Reclassification from Redeemable Non-controlling Interests Payments Realized and Unrealized Depreciation Balance at December 31, 2019 (in thousands) Due to DB Med Investors (Note 11) $ — 18,109 (16,537 ) 178 $ 1,750 A review of the fair value hierarchy classifications is conducted on a quarterly basis. Changes in the observability of valuation inputs may result in a reclassification for certain financial assets or liabilities. Reclassifications impacting all levels of the fair value hierarchy are reported as transfers in or out of Level I, II or III category as of the beginning of the quarter during which the reclassifications occur. There were no transfers between levels in the fair value hierarchy during the year ended December 31, 2019. When determining the fair value of publicly traded equity securities, the Company uses the quoted closing market price as of the valuation date on the primary market or exchange on which they trade. Our equity method investments for which fair value is measured at NAV per share, or its equivalent, using the practical expedient, are not categorized in the fair value hierarchy. The Company's investments of consolidated fund are treated as investments at fair value and any realized and unrealized gains and losses from those investments are recorded through the Company's consolidated statements of operations. The Company's treatment is consistent with that of STRF, which is considered an investment company under ASC 946, Financial Services - Investment Companies, for standalone reporting purposes. The fair value of the Company's liability to DB Med Investors balance is derived from the net asset value of shares of STRF which is held by the Company as such shares will be distributed to DB Med Investors in satisfaction of the liability. Changes in unrealized losses related to the Company's due to DB Med Investors liability were all included in earnings. For the year ended December 31, 2019, there was no change in the fair value of the due to DB Med Investors liability resulting from instrument-specific credit risk. |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Leases | LEASES On January 1, 2019, the Company adopted ASC 842, Leases, under the modified retrospective method where any transition adjustments are recorded through a cumulative adjustment to retained earnings in the period of adoption. This new accounting standard requires a dual approach for lessee accounting whereby a lessee accounts for lease arrangements as either operating leases or finance leases. A lease is defined as a contract, or part of a contract, that conveys the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration. The Company has elected the transition relief package of practical expedients permitted within ASC 842. Accordingly, the Company has not reassessed the classification of its existing leases as of the transition date, whether existing contracts at the transition date contain a lease, or whether unamortized initial direct costs before the transition adjustments would have met the definition of initial direct costs at lease commencement. The Company also applied practical expedients to not separate lease and non-lease components for all new leases as well as leases commencing before the effective date, if certain criteria are met, and does not record leases on its consolidated balance sheet with expected terms of twelve months or less. Upon adoption of ASC 842, the Company recognized $8.2 million of right-of-use assets under operating leases and operating lease liabilities of $10.2 million . Under ASC 842, at the inception of an arrangement, the Company determines whether the arrangement is or contains a lease based on the circumstances present. Leases with a term greater than one year are recognized on the balance sheet as right-of-use assets and lease liabilities. Lease liabilities and the corresponding right-of-use assets are recorded based on the present values of lease payments over the expected lease terms. The Company’s expected lease terms may include options to extend or terminate the lease when it is reasonably certain that it will exercise that option. When determining if a renewal option is reasonably certain of being exercised, the Company considers several factors, including but not limited to, the significance of leasehold improvements incurred on the property, whether the asset is difficult to replace, or specific characteristics unique to the particular lease that would make it reasonably certain that the Company would exercise such option. The Company has concluded that renewal and early termination options are not reasonably certain of being exercised by the Company and thus not included in the calculation of its right-of-use assets and operating lease liabilities. The interest rate implicit in lease contracts is typically not readily determinable. As such, the Company utilizes the appropriate incremental borrowing rates, which are the rates that would be incurred to borrow on a collateralized basis, over similar terms, amounts equal to the lease payments in a similar economic environment. Variable payments that do not depend on a rate or index are not included in the lease liability and are recognized as incurred. If significant events, changes in circumstances, or other events indicate that the lease term or other inputs have changed, the Company would reassess lease classification, re-measure the lease liability by using revised inputs as of the reassessment date, and adjust the underlying right-of-use asset. Substantially all of the Company's operating leases are comprised of its office space in New York City and San Francisco which expire at various times through September 2023. The Company does not have any contracts that would be classified as a finance lease or any operating leases that contain variable payments. The components of lease cost and other information for the year ended December 31, 2019 are as follows (in thousands): Lease cost Operating lease costs $ 2,554 Variable lease costs — Sublease income (454 ) Total lease cost $ 2,100 Supplemental balance sheet information related to leases as of December 31, 2019 are as follows: Weighted-average remaining lease term (in years) 3.5 Weighted-average discount rate 8.2 % Future payments for operating leases as of December 31, 2019 are as follows (in thousands): 2020 $ 2,846 2021 2,483 2022 2,441 2023 1,822 Total future lease payments 9,592 Less imputed interest (1,325 ) Operating lease liabilities, as reported $ 8,267 For the years ended December 31, 2018 and 2017, rent expense amounted to $2.3 million and $2.4 million , respectively. There is no material difference between the amount of lease expense recognized under the new lease accounting standard versus the superseded lease accounting standard. |
OTHER ASSETS
OTHER ASSETS | 12 Months Ended |
Dec. 31, 2019 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other Assets | OTHER ASSETS Other assets consist of the following: As of December 31, 2019 2018 (in thousands) Fixed assets, net of accumulated depreciation and amortization of $3,847 and $3,446, respectively $ 2,564 $ 3,140 Security deposits 1,975 1,975 Administrative fees receivable (Note 13) 1,073 1,645 Deferred tax assets, net (Note 14) — 3,144 Due from affiliates (Note 13) 2,693 2,215 Prepaid expenses and income taxes 746 761 Other assets 676 1,265 Total other assets $ 9,727 $ 14,145 |
SENIOR UNSECURED DEBT
SENIOR UNSECURED DEBT | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Senior Unsecured Debt | SENIOR UNSECURED DEBT The carrying value of the Company’s senior unsecured debt consist of the following: As of December 31, 2019 2018 (in thousands) 2026 Notes, net of unamortized discount and debt issuance costs of $2,584 and $2,946, respectively $ 51,011 $ 50,649 2024 Notes, net of unamortized premium and debt issuance costs of $1,629 and $2,031 respectively 67,371 66,969 Total senior unsecured debt $ 118,382 $ 117,618 2026 Notes On August 9, 2016 and October 18, 2016, the Company issued debt consisting of $53.6 million in aggregate principal amount of senior unsecured notes due 2026 at a stated coupon rate of 6.875% (the "2026 Notes"). The net proceeds from these offerings were used to pay down a portion of the Company's outstanding indebtedness under its Term Loan Facility. Interest is payable quarterly. The 2026 Notes are subject to redemption in whole or in part at any time or from time to time, at the option of the Company, on or after August 15, 2019 at a redemption price per security equal to 100% of the outstanding principal amount thereof plus accrued and unpaid interest payments. The 2026 notes were recorded net of discount and direct issuance costs of $3.8 million which are being amortized over the term of the notes using the effective interest rate method. The 2026 Notes are listed on the New York Stock Exchange and trade thereon under the trading symbol “MDLX.” The fair value of the 2026 Notes based on their underlying quoted market price was $36.0 million as of December 31, 2019 . Interest expense on the 2026 Notes, including accretion of note discount and amortization of debt issuance costs, was $4.0 million for each of the years ended December 31, 2019 , 2018 and 2017. 2024 Notes On January 18, 2017 and February 22, 2017, the Company issued $69.0 million in aggregate principal amount of senior unsecured notes due 2024 at a stated coupon rate of 7.25% (the "2024 Notes"). The net proceeds from these offerings were used to pay down the remaining portion of the Company's outstanding indebtedness under its Term Loan Facility with the remaining to be used for general corporate purposes. Interest is payable quarterly and interest payments commenced on April 30, 2017. The 2024 Notes are subject to redemption in whole or in part at any time or from time to time, at the option of the Company, on or after January 30, 2020 at a redemption price per security equal to 100% of the outstanding principal amount thereof plus accrued and unpaid interest payments. The 2024 notes were recorded net of premium and direct issuance costs of $2.8 million which are being amortized over the term of the notes using the effective interest rate method. The 2024 Notes are listed on the New York Stock Exchange and trade thereon under the trading symbol “MDLQ.” The fair value of the 2024 Notes based on their underlying quoted market price was $48.4 million as of December 31, 2019 . Interest expense on the 2024 Notes, including amortization of debt premium and debt issuance costs, was $5.4 million for each of the years ended December 31, 2019 and 2018, and was $4.9 million for the year ended December 31, 2017. LOANS PAYABLE Loans payable consist of the following: As of December 31, 2019 2018 (in thousands) Non-recourse promissory notes, net of unamortized discount of $108 at December 31, 2018 $ 10,000 $ 9,892 Total loans payable $ 10,000 $ 9,892 Non-Recourse Promissory Notes In April 2012, the Company borrowed $10.0 million under two non-recourse promissory notes. Proceeds from the borrowings were used to purchase 1,108,033 shares of common stock of SIC, which were pledged as collateral for the obligations. Interest on the notes is paid monthly and is equal to the dividends received by the Company related to the pledged shares. The Company may prepay the notes in whole or in part at any time without penalty and the lenders may call the notes if certain conditions are met. The proceeds from the notes were recorded net of issuance costs of $3.8 million and were being accreted, using the effective interest method, over the original term of the non-recourse promissory notes. Total interest expense under these notes, including accretion of the notes discount, was $0.9 million for the year ended December 31, 2019, and $1.4 million for each of the years ended December 31, 2018 and 2017. The notes had an original maturity date of March 31, 2019. Through various amendments dated February 28, 2019, June 28, 2019 and December 8, 2019, the maturity date had been extended with the latest amendment extending the maturity date to March 31, 2020. In consideration for the June 28, 2019 amendment, the interest rate on these notes were increased by 1.0% per annum. The Company is currently in discussions with the lenders to extend the March 31, 2020 maturity date to June 30, 2020. The fair value of the outstanding balance of the notes was $10.0 million as of December 31, 2019 and 2018. On January 31, 2019, the Company entered into a termination agreement with the lenders which will become effective upon the closing of the Company's pending merger with Sierra. In accordance with the provisions of the termination agreement, the Company will be required to pay the lenders $6.5 million on or prior to the merger closing date, reimburse the lenders for their out of pocket legal fees and enter into a new $6.5 million promissory note ("New Promissory Note"). The New Promissory Note will bear interest at LIBOR plus 7.0% and maturity will be six months after the merger closing date. Such consideration would be for the full satisfaction of the two aforementioned non-recourse promissory notes and related agreements, including the Company's revenue share payable, as further described in Note 12. Credit Suisse Term Loan Facility On August 14, 2014, the Company entered into a $110.0 million senior secured term loan credit facility (as amended, “Term Loan Facility”) with Credit Suisse AG, Cayman Islands Branch, as administrative agent and collateral agent thereunder, Credit Suisse Securities (USA) LLC, as bookrunner and lead arranger, and the lenders from time-to-time party thereto, which had an original maturity date of June 15, 2019. In February 2017, borrowings under this facility were paid off using the proceeds from the issuance of senior unsecured debt and the Term Loan Facility was terminated. During the year ending December 31, 2017, interest expense under the Term Loan Facility, including accretion of the note discount and amortization of debt issuance costs were $1.5 million . Contractual Maturities of Loans Payable As further described above, upon closing of the Company's pending merger with Sierra, the Company's two non-recourse promissory notes and revenue sharing arrangement would be settled for payment of $6.5 million on or prior to the merger closing date and delivery of the New Promissory Note. If the pending merger does not close, $10.0 million of future principal payments will be due, relating to loans payable, on March 31, 2020. CNB Credit Agreement On August 19, 2014, the Company entered into a $15.0 million senior secured revolving credit facility with City National Bank (as amended, the “Revolving Credit Facility”). The Company intended to use any proceeds from borrowings under the Revolving Credit Facility for general corporate purposes, including funding of its working capital needs. Borrowings under the Revolving Credit Facility bore interest, at the option of the Company, either (i) at an Alternate Base Rate, as defined, plus an applicable margin not to exceed 0.25% or (ii) at an Adjusted LIBOR plus an applicable margin not to exceed 2.5% . The Revolving Credit Facility also contained financial covenants, customary negative covenants and other customary events of default, including defaults based on events of bankruptcy and insolvency, dissolution, nonpayment of principal, interest or fees when due, breach of specified covenants, change in control and material inaccuracy of representations and warranties. Effective May 13, 2019, the Company terminated the Revolving Credit Facility. There were no early termination penalties incurred by the Company. For the each of the years ended December 31, 2019, 2018 and 2017, amortization of deferred issuance costs associated with the Revolving Credit Facility were $0.1 million . |
LOANS PAYABLE
LOANS PAYABLE | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Loans Payable | SENIOR UNSECURED DEBT The carrying value of the Company’s senior unsecured debt consist of the following: As of December 31, 2019 2018 (in thousands) 2026 Notes, net of unamortized discount and debt issuance costs of $2,584 and $2,946, respectively $ 51,011 $ 50,649 2024 Notes, net of unamortized premium and debt issuance costs of $1,629 and $2,031 respectively 67,371 66,969 Total senior unsecured debt $ 118,382 $ 117,618 2026 Notes On August 9, 2016 and October 18, 2016, the Company issued debt consisting of $53.6 million in aggregate principal amount of senior unsecured notes due 2026 at a stated coupon rate of 6.875% (the "2026 Notes"). The net proceeds from these offerings were used to pay down a portion of the Company's outstanding indebtedness under its Term Loan Facility. Interest is payable quarterly. The 2026 Notes are subject to redemption in whole or in part at any time or from time to time, at the option of the Company, on or after August 15, 2019 at a redemption price per security equal to 100% of the outstanding principal amount thereof plus accrued and unpaid interest payments. The 2026 notes were recorded net of discount and direct issuance costs of $3.8 million which are being amortized over the term of the notes using the effective interest rate method. The 2026 Notes are listed on the New York Stock Exchange and trade thereon under the trading symbol “MDLX.” The fair value of the 2026 Notes based on their underlying quoted market price was $36.0 million as of December 31, 2019 . Interest expense on the 2026 Notes, including accretion of note discount and amortization of debt issuance costs, was $4.0 million for each of the years ended December 31, 2019 , 2018 and 2017. 2024 Notes On January 18, 2017 and February 22, 2017, the Company issued $69.0 million in aggregate principal amount of senior unsecured notes due 2024 at a stated coupon rate of 7.25% (the "2024 Notes"). The net proceeds from these offerings were used to pay down the remaining portion of the Company's outstanding indebtedness under its Term Loan Facility with the remaining to be used for general corporate purposes. Interest is payable quarterly and interest payments commenced on April 30, 2017. The 2024 Notes are subject to redemption in whole or in part at any time or from time to time, at the option of the Company, on or after January 30, 2020 at a redemption price per security equal to 100% of the outstanding principal amount thereof plus accrued and unpaid interest payments. The 2024 notes were recorded net of premium and direct issuance costs of $2.8 million which are being amortized over the term of the notes using the effective interest rate method. The 2024 Notes are listed on the New York Stock Exchange and trade thereon under the trading symbol “MDLQ.” The fair value of the 2024 Notes based on their underlying quoted market price was $48.4 million as of December 31, 2019 . Interest expense on the 2024 Notes, including amortization of debt premium and debt issuance costs, was $5.4 million for each of the years ended December 31, 2019 and 2018, and was $4.9 million for the year ended December 31, 2017. LOANS PAYABLE Loans payable consist of the following: As of December 31, 2019 2018 (in thousands) Non-recourse promissory notes, net of unamortized discount of $108 at December 31, 2018 $ 10,000 $ 9,892 Total loans payable $ 10,000 $ 9,892 Non-Recourse Promissory Notes In April 2012, the Company borrowed $10.0 million under two non-recourse promissory notes. Proceeds from the borrowings were used to purchase 1,108,033 shares of common stock of SIC, which were pledged as collateral for the obligations. Interest on the notes is paid monthly and is equal to the dividends received by the Company related to the pledged shares. The Company may prepay the notes in whole or in part at any time without penalty and the lenders may call the notes if certain conditions are met. The proceeds from the notes were recorded net of issuance costs of $3.8 million and were being accreted, using the effective interest method, over the original term of the non-recourse promissory notes. Total interest expense under these notes, including accretion of the notes discount, was $0.9 million for the year ended December 31, 2019, and $1.4 million for each of the years ended December 31, 2018 and 2017. The notes had an original maturity date of March 31, 2019. Through various amendments dated February 28, 2019, June 28, 2019 and December 8, 2019, the maturity date had been extended with the latest amendment extending the maturity date to March 31, 2020. In consideration for the June 28, 2019 amendment, the interest rate on these notes were increased by 1.0% per annum. The Company is currently in discussions with the lenders to extend the March 31, 2020 maturity date to June 30, 2020. The fair value of the outstanding balance of the notes was $10.0 million as of December 31, 2019 and 2018. On January 31, 2019, the Company entered into a termination agreement with the lenders which will become effective upon the closing of the Company's pending merger with Sierra. In accordance with the provisions of the termination agreement, the Company will be required to pay the lenders $6.5 million on or prior to the merger closing date, reimburse the lenders for their out of pocket legal fees and enter into a new $6.5 million promissory note ("New Promissory Note"). The New Promissory Note will bear interest at LIBOR plus 7.0% and maturity will be six months after the merger closing date. Such consideration would be for the full satisfaction of the two aforementioned non-recourse promissory notes and related agreements, including the Company's revenue share payable, as further described in Note 12. Credit Suisse Term Loan Facility On August 14, 2014, the Company entered into a $110.0 million senior secured term loan credit facility (as amended, “Term Loan Facility”) with Credit Suisse AG, Cayman Islands Branch, as administrative agent and collateral agent thereunder, Credit Suisse Securities (USA) LLC, as bookrunner and lead arranger, and the lenders from time-to-time party thereto, which had an original maturity date of June 15, 2019. In February 2017, borrowings under this facility were paid off using the proceeds from the issuance of senior unsecured debt and the Term Loan Facility was terminated. During the year ending December 31, 2017, interest expense under the Term Loan Facility, including accretion of the note discount and amortization of debt issuance costs were $1.5 million . Contractual Maturities of Loans Payable As further described above, upon closing of the Company's pending merger with Sierra, the Company's two non-recourse promissory notes and revenue sharing arrangement would be settled for payment of $6.5 million on or prior to the merger closing date and delivery of the New Promissory Note. If the pending merger does not close, $10.0 million of future principal payments will be due, relating to loans payable, on March 31, 2020. CNB Credit Agreement On August 19, 2014, the Company entered into a $15.0 million senior secured revolving credit facility with City National Bank (as amended, the “Revolving Credit Facility”). The Company intended to use any proceeds from borrowings under the Revolving Credit Facility for general corporate purposes, including funding of its working capital needs. Borrowings under the Revolving Credit Facility bore interest, at the option of the Company, either (i) at an Alternate Base Rate, as defined, plus an applicable margin not to exceed 0.25% or (ii) at an Adjusted LIBOR plus an applicable margin not to exceed 2.5% . The Revolving Credit Facility also contained financial covenants, customary negative covenants and other customary events of default, including defaults based on events of bankruptcy and insolvency, dissolution, nonpayment of principal, interest or fees when due, breach of specified covenants, change in control and material inaccuracy of representations and warranties. Effective May 13, 2019, the Company terminated the Revolving Credit Facility. There were no early termination penalties incurred by the Company. For the each of the years ended December 31, 2019, 2018 and 2017, amortization of deferred issuance costs associated with the Revolving Credit Facility were $0.1 million . |
DUE TO FORMER MINORITY INTEREST
DUE TO FORMER MINORITY INTEREST HOLDER | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Due to Former Minority Interest Holder | DUE TO FORMER MINORITY INTEREST HOLDER This balance consists of the following: As of December 31, 2019 2018 (in thousands) Due to former minority interest holder, net of unamortized discount of $1,480 and $2,598, respectively $ 8,145 $ 11,402 Total due to former minority interest holder $ 8,145 $ 11,402 In January 2016, the Company executed an amendment to SIC Advisors' operating agreement which provided the Company with the right to redeem membership units owned by the minority interest holder, Strategic Capital Advisory Services, LLC. The Company’s redemption right was triggered by the termination of the dealer manager agreement between Sierra and SC Distributors LLC ("DMA Termination"), an affiliate of the minority interest holder. As a result of this redemption feature, the Company reclassified the non-controlling interest in SIC Advisors from the equity section of its consolidated balance sheet to redeemable non-controlling interests in the mezzanine section of its consolidated balance sheet based on its fair value as of the amendment date. On July 31, 2018, a DMA Termination event occurred and, as a result, the Company reclassified the redeemable non-controlling interest in SIC Advisors from redeemable non-controlling interests in the mezzanine section of its consolidated balance sheet to due to former minority interest holder, a component of total liabilities on the Company's consolidated balance sheet, based on its fair value as of that date. In December 2018, the Company entered into a Letter Agreement with Strategic Capital Advisory Services, LLC, whereby consideration of $14.0 million was agreed upon for the satisfaction in full of all amounts owed by the Company under the LLC Agreement. The amount due will be paid in sixteen equal installments through August 5, 2022. The Company evaluated this agreement under ASC 470-50, Debt - Modifications and Extinguishment , to determine if modification or extinguishment treatment was necessary. After performing this analysis, the Company determined modification treatment was appropriate and a new effective interest rate was established on the modification date. As of December 31, 2019 future payments due to the former minority interest holder are as follows (in thousands): 2020 $ 3,500 2021 3,500 2022 2,625 Total future payments $ 9,625 The amount due is payable in quarterly installments over a four year period, beginning in January 2019. For the years ended December 31, 2019 and 2018, the amortization of the discount of $2.8 million was $1.1 million and less than $0.1 million , respectively, and is included as a component of interest expense on the Company's consolidated statements of operations. |
ACCOUNTS PAYABLE, ACCRUED EXPEN
ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER LIABILITIES | 12 Months Ended |
Dec. 31, 2019 | |
Payables and Accruals [Abstract] | |
Accounts Payable, Accrued Expenses and Other Liabilities | ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER LIABILITIES Accounts payable, accrued expenses and other liabilities consist of the following: As of December 31, 2019 2018 (in thousands) Accrued compensation and benefits $ 6,161 $ 7,438 Due to affiliates (Note 13) 7,212 7,635 Revenue share payable (Note 12) 2,316 2,976 Accrued interest 1,294 1,294 Professional fees 1,481 2,594 Deferred rent — 2,035 Deferred tax liabilities (Note 14) — 60 Due to DB Med Investors, at fair value 1,750 — Accounts payable and other accrued expenses 1,672 2,412 Total accounts payable, accrued expenses and other liabilities $ 21,886 $ 26,444 On June 3, 2016, the Company entered into a Master Investment Agreement with DB MED Investor I LLC and DB MED Investor II LLC ("DB Med Investors’’) to invest in new and existing Medley managed funds (the "Joint Venture"). Under the Master Investment Agreement, as amended (the "MIA"), DB Med Investors have the right upon the occurrence of certain events (the "Put Option Trigger Event") to redeem their interests in the Joint Venture. In October 2019, a Put Option Trigger Event had occurred. On October 22, 2019, Medley LLC, Medley Seed Funding I LLC (“Seed Funding I”) and Medley Seed Funding II LLC (“Seed Funding II”) received notice from DB Med Investors that they exercised their put option right under the MIA. In connection with the exercise of DB Med Investors put option right, the Company reclassified the Joint Venture's minority interest balance from redeemable non-controlling interests in the mezzanine section of its consolidated balance sheet (Note 16) to due to DB Med Investors, at fair value, a component of accounts payable, accrued expenses and other liabilities, at its then fair value of $18.1 million . In addition, the Company elected to subsequently remeasure the liability under ASC 825, Financial Instruments, with changes recorded through earnings. Management elected the fair value option to measure this liability as the liability will ultimately be settled by delivering assets of the Medley Seed Funding entities which are measured at their fair value on the company's consolidated balance sheets. The net change in fair value during the year ended December 31, 2019 was $0.2 million and is included as a component of other (expenses) income, net on the Company's consolidated statement of operations. In accordance with its obligations under the MIA, on October 25, 2019 and October 28, 2019, Seed Funding I distributed to DB Med Investors all of its assets, including the 7,756,938 shares of MCC, which had an aggregate fair value on the date of transfer of $16.5 million , and cash of less than $0.1 million . Seed Funding II expects to distribute to DB Med Investors all of its assets, including cash of less than $0.1 million and approximately 82,121 shares held by Seed Investor II in Sierra Total Return Fund by March 31, 2020. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Operating Leases Refer to Note 6 to these consolidated financial statements. Consolidation of Business Activities During the first quarter of 2018, the Company initiated the consolidation of its business activities to its New York office. The Company believes this will enhance operations by consolidating origination, underwriting and asset management operations and personnel in a single location. During the year ended December 30, 2018, the Company recorded $2.7 million in severance costs and a $0.2 million loss from subleasing its San Francisco office space. Capital Commitments to Funds As of December 31, 2019 and 2018, the Company had aggregate unfunded commitments of $0.3 million to certain long-dated private funds. Other Commitments In April 2012, the Company entered into an obligation to pay to a third party a fixed percentage of management and incentive fees received by the Company from Sierra. The agreement was entered into contemporaneously with the $10.0 million non-recourse promissory notes that were issued to the same parties (Note 9). The two transactions were deemed to be related freestanding contracts and the $10.0 million of loan proceeds were allocated to the contracts using their relative fair values. At inception, the Company recognized an obligation of $4.4 million representing the present value of the future cash flows expected to be paid under this agreement. As of December 31, 2019 and 2018, this obligation amounted to $2.3 million and $3.0 million , respectively, and is recorded as revenue share payable, a component of accounts payable, accrued expenses and other liabilities on the Company's consolidated balance sheets. The change in the estimated cash flows for this obligation is recorded in other expenses, net on the Company's consolidated statements of operations. On January 31, 2019, the Company entered into a termination agreement with the lenders which would become effective upon the closing of the Company's pending merger with Sierra. In accordance with the provisions of the termination agreement, the Company would pay the lenders $6.5 million on or prior to the merger closing date, reimburse the lenders for their out of pocket legal fees and enter into a six month $6.5 million promissory note. The promissory note would bear interest at seven percentage points over the LIBOR Rate, as defined in the termination agreement. Such consideration would be for the full satisfaction of the two non-recourse promissory notes disclosed in Note 9 as well as the Company's revenue share obligation described above. Legal Proceedings From time to time, the Company is involved in various legal proceedings, lawsuits and claims incidental to the conduct of its business. Its business is also subject to extensive regulation, which may result in regulatory proceedings against it. Except as described below, the Company is not currently party to any material legal proceedings. One of the Company's subsidiaries, MCC Advisors LLC, was named as a defendant in a lawsuit on May 29, 2015, by Moshe Barkat and Modern VideoFilm Holdings, LLC (“MVF Holdings”) against MCC, MOF II, MCC Advisors LLC, Deloitte Transactions and Business Analytics LLP A/K/A Deloitte ERG (“Deloitte”), Scott Avila (“Avila”), Charles Sweet, and Modern VideoFilm, Inc. (“MVF”). The lawsuit is pending in the California Superior Court, Los Angeles County, Central District, as Case No. BC 583437. The lawsuit was filed after MCC, as agent for the lender group, exercised remedies following a series of defaults by MVF and MVF Holdings on a secured loan with an outstanding balance at the time in excess of $65 million . The lawsuit sought damages in excess of $100 million . Deloitte and Avila have settled the claims against them in exchange for payment of $1.5 million . On June 6, 2016, the court granted the Medley defendants’ demurrers on several counts and dismissed Mr. Barkat’s claims with prejudice except with respect to his claim for intentional interference with contract. On March 18, 2018, the court granted the Medley defendants’ motion for summary adjudication with respect to Mr. Barkat’s sole remaining claim against the Medley Defendants for intentional interference. Now that the trial court has ruled in favor of the Medley defendants on all counts, the only remaining claims in the Barkat litigation are MCC and MOF II’s affirmative counterclaims against Mr. Barkat and MVF Holdings, which MCC and MOF II are diligently prosecuting. On August 29, 2016, MVF Holdings filed another lawsuit in the California Superior Court, Los Angeles County, Central District, as Case No. BC 631888 (the “Derivative Action”), naming MCC Advisors LLC and certain of Medley’s employees as defendants, among others. The plaintiff in the Derivative Action, asserts claims against the defendants for breach of fiduciary duty, aiding and abetting breach of fiduciary duty, unfair competition, breach of the implied covenant of good faith and fair dealing, interference with prospective economic advantage, fraud, and declaratory relief. MCC Advisors LLC and the other defendants believe the causes of action asserted in the Derivative Action are without merit and all defendants intend to continue to assert a vigorous defense. A trial has been set for May 19, 2020. Medley LLC, Medley Capital Corporation, Medley Opportunity Fund II LP, Medley Management, Inc., Medley Group, LLC, Brook Taube, and Seth Taube were named as defendants, along with other various parties, in a putative class action lawsuit captioned as Royce Solomon, Jodi Belleci, Michael Littlejohn, and Giulianna Lomaglio v. American Web Loan, Inc., AWL, Inc., Mark Curry, MacFarlane Group, Inc., Sol Partners, Medley Opportunity Fund, II, LP, Medley LLC, Medley Capital Corporation, Medley Management, Inc., Medley Group, LLC, Brook Taube, Seth Taube, DHI Computing Service, Inc., Middlemarch Partners, and John Does 1-100, filed on December 15, 2017, amended on March 9, 2018, and amended a second time on February 15, 2019, in the United States District Court for the Eastern District of Virginia, Newport News Division, as Case No. 4:17-cv-145 (hereinafter, “Class Action 1”). Medley Opportunity Fund II LP and Medley Capital Corporation were also named as defendants, along with various other parties, in a putative class action lawsuit captioned George Hengle and Lula Williams v. Mark Curry, American Web Loan, Inc., AWL, Inc., Red Stone, Inc., Medley Opportunity Fund II LP, and Medley Capital Corporation, filed February 13, 2018, in the United States District Court, Eastern District of Virginia, Richmond Division, as Case No. 3:18-cv-100 (“Class Action 2”). Medley Opportunity Fund II LP and Medley Capital Corporation were also named as defendants, along with various other parties, in a putative class action lawsuit captioned John Glatt, Sonji Grandy, Heather Ball, Dashawn Hunter, and Michael Corona v. Mark Curry, American Web Loan, Inc., AWL, Inc., Red Stone, Inc., Medley Opportunity Fund II LP, and Medley Capital Corporation, filed August 9, 2018 in the United States District Court, Eastern District of Virginia, Newport News Division, as Case No. 4:18-cv-101 (“Class Action 3”) (together with Class Action 1 and Class Action 2, the “Virginia Class Actions”). Medley Opportunity Fund II LP was also named as a defendant, along with various other parties, in a putative class action lawsuit captioned Christina Williams and Michael Stermel v. Red Stone, Inc. (as successor in interest to MacFarlane Group, Inc.), Medley Opportunity Fund II LP, Mark Curry, Brian McGowan, Vincent Ney, and John Doe entities and individuals, filed June 29, 2018 and amended July 26, 2018, in the United States District Court for the Eastern District of Pennsylvania, as Case No. 2:18-cv-2747 (the “Pennsylvania Class Action”) (together with the Virginia Class Actions, the “Class Action Complaints”). The plaintiffs in the Class Action Complaints filed their putative class actions alleging claims under the Racketeer Influenced and Corrupt Organizations Act, and various other claims arising out of the alleged payday lending activities of American Web Loan. The claims against Medley Opportunity Fund II LP, Medley LLC, Medley Capital Corporation, Medley Management, Inc., Medley Group, LLC, Brook Taube, and Seth Taube (in Class Action 1, as amended); Medley Opportunity Fund II LP and Medley Capital Corporation (in Class Action 2 and Class Action 3); and Medley Opportunity Fund II LP (in the Pennsylvania Class Action), allege that those defendants in each respective action exercised control over, or improperly derived income from, and/or obtained an improper interest in, American Web Loan’s payday lending activities as a result of a loan to American Web Loan. The loan was made by Medley Opportunity Fund II LP in 2011. American Web Loan repaid the loan from Medley Opportunity Fund II LP in full in February of 2015, more than 1 year and 10 months prior to any of the loans allegedly made by American Web Loan to the alleged class plaintiff representatives in Class Action 1. In Class Action 2, the alleged class plaintiff representatives have not alleged when they received any loans from American Web Loan. In Class Action 3, the alleged class plaintiff representatives claim to have received loans from American Web Loan at various times from February 2015 through April 2018. In the Pennsylvania Class Action, the alleged class plaintiff representatives claim to have received loans from American Web Loan in 2017. By orders dated August 7, 2018 and September 17, 2018, the Court presiding over the Virginia Class Actions consolidated those cases for all purposes. On October 12, 2018, Plaintiffs in Class Action 3 filed a notice of voluntary dismissal of all claims, and on October 29, 2018, Plaintiffs in Class Action 2 filed a notice of voluntary dismissal of all claims. Medley LLC, Medley Capital Corporation, Medley Management, Inc., Medley Group, LLC, Brook Taube, and Seth Taube never made any loans or provided financing to, or had any other relationship with, American Web Loan. Medley Opportunity Fund II LP, Medley LLC, Medley Capital Corporation, Medley Management, Inc., Medley Group, LLC, Brook Taube, Seth Taube are seeking indemnification from American Web Loan, various affiliates, and other parties with respect to the claims in the Class Action Complaints. Medley Opportunity Fund II LP, Medley LLC, Medley Capital Corporation, Medley Management, Inc., Medley Group, LLC, Brook Taube, and Seth Taube believe the alleged claims in the Class Action Complaints are without merit and they intend to defend these lawsuits vigorously. On January 25, 2019, two purported class actions were commenced in the Supreme Court of the State of New York, County of New York, by alleged stockholders of Medley Capital Corporation, captioned, respectively, Helene Lax v. Brook Taube, et al., Index No. 650503/2019, and Richard Dicristino, et al. v. Brook Taube, et al., Index No. 650510/2019 (together with the Lax Action, the “New York Actions”). Named as defendants in each complaint are Brook Taube, Seth Taube, Jeffrey Tonkel, Arthur S. Ainsberg, Karin Hirtler-Garvey, John E. Mack, Mark Lerdal, Richard T. Allorto, Jr., Medley Capital Corporation, Medley Management Inc., Sierra Income Corporation, and Sierra Management, Inc. The complaints in each of the New York Actions allege that the individuals named as defendants breached their fiduciary duties in connection with the proposed merger of MCC with and into Sierra, and that the other defendants aided and abetted those alleged breaches of fiduciary duties. Compensatory damages in unspecified amounts were sought. On December 20, 2019, the Delaware court entered an Order and Final Judgment approving the settlement of the Delaware Action (defined below). The release in the Delaware Action also operate to release the claims asserted in the New York Actions. The attorneys for the plaintiffs in New York Action have informed the Court that they reserve the right to seek an award of attorneys' fees on account of their purported contributions to the settlement of the Delaware Action, which the defendants reserve the right to oppose. On February 11, 2019, a purported stockholder class action was commenced in the Court of Chancery of the State of Delaware (the "Delaware Court of Chancery") by FrontFour Capital Group LLC and FrontFour Master Fund, Ltd. (together, “FrontFour”), captioned FrontFour Capital Group LLC, et al. v. Brook Taube, et al., Case No. 2019-0100 (the “Delaware Action”), against defendants Brook Taube, Seth Taube, Jeff Tonkel, Mark Lerdal, Karin Hirtler-Garvey, John E. Mack, Arthur S. Ainsberg, MDLY, Sierra, MCC, MCC Advisors LLC (“MCC Advisors”), Medley Group LLC, and Medley LLC. The complaint, as amended on February 12, 2019, alleged that the individuals named as defendants breached their fiduciary duties to MCC's stockholders in connection with the “MCC Merger”, and that MDLY, Sierra, MCC Advisors, Medley Group LLC, and Medley LLC aided and abetted those alleged breaches of fiduciary duties. The complaint sought to enjoin the vote of MCC's stockholders on the proposed merger and enjoin enforcement of certain provisions of the MCC Merger Agreement. The Delaware Court of Chancery held a trial on the plaintiffs’ motion for a preliminary injunction and issued a Memorandum Opinion (the “Decision”) on March 11, 2019. The Delaware Court of Chancery denied the plaintiffs’ requests to (i) permanently enjoin the proposed merger and (ii) require MCC to conduct a “shopping process” for MCC on terms proposed by the plaintiffs in their complaint. The Delaware Court of Chancery held that MCC’s directors breached their fiduciary duties in entering into the proposed merger, but rejected the plaintiffs’ claim that Sierra aided and abetted those breaches of fiduciary duties. The Delaware Court of Chancery ordered the defendants to issue corrective disclosures consistent with the Decision, and enjoined a vote of MCC's stockholders on the proposed merger until such disclosures had been made and stockholders had the opportunity to assimilate this information. On March 20, 2019, another purported stockholder class action was commenced by Stephen Altman against Brook Taube, Seth Taube, Jeff Tonkel, Arthur S. Ainsberg, Karin Hirtler-Garvey, Mark Lerdal, and John E. Mack in the Delaware Court of Chancery, captioned Altman v. Taube, Case No. 2019-0219 (the “Altman Action”). The complaint alleged that the defendants breached their fiduciary duties to stockholders of MCC in connection with the vote of MCC's stockholders on the proposed mergers. On April 8, 2019, the Delaware Court of Chancery granted a stipulation consolidating the Delaware Action and the Altman Action, designating the amended complaint in the Delaware Action as the operative complaint, and designating the plaintiffs in the Delaware Action and their counsel the lead plaintiffs and lead plaintiffs’ counsel, respectively. On December 20, 2019, the Delaware Court of Chancery entered an Order and Final Judgment approving the settlement of the Delaware Action (the "Settlement"). Pursuant to the Settlement, the Company agreed to certain amendments to (i) the MCC Merger Agreement and (ii) the MDLY Merger Agreement, which amendments are reflected in the Amended MCC Merger Agreement and the Amended MDLY Merger Agreement. The Settlement also provides for, if the MCC Merger is consummated, the creation of a settlement fund, consisting of $17 million in cash and $30 million of Sierra's common stock, with the number of shares of Sierra's common stock to be calculated using the pro forma net asset value of $6.37 per share as of June 30, 2019, which will be distributed to eligible members of the Settlement Class (as defined in the Settlement). In addition, in connection with the Settlement, on July 29, 2019, MCC entered into a Governance Agreement with FrontFour Capital Group LLC, FrontFour Master Fund, Ltd., FrontFour Capital Corp., FrontFour Opportunity Fund, David A. Lorber, Stephen E. Loukas and Zachary R. George, pursuant to which, among other matters, FrontFour is subject to customary standstill restrictions and required to vote in favor of the amended MCC Merger at a meeting of stockholders to approve the Amended MCC Merger Agreement. . The Settlement also provides for mutual releases between and among FrontFour and the Settlement Class, on the one hand, and the Medley Parties, on the other hand, of all claims that were or could have been asserted in the Delaware Action through September 26, 2019. The Delaware Court of Chancery also awarded attorney’s fees as follows: (i) an award of $3,000,000 to lead plaintiffs’ counsel and $75,000 to counsel to plaintiff Stephen Altman (the “Therapeutics Fee Award”) and $420,334.97 of plaintiff counsel expenses payable to the lead plaintiff’s counsel, which were paid by MCC on December 23, 2019, and (ii) an award that is contingent upon the closing of the proposed merger transactions (the “Contingent Fee Award”), consisting of: a. $100,000 for the agreement by Sierra's board of directors to appoint one independent director of MCC who will be selected by the independent director of Sierra on the board of directors of the post-merger company upon the closing of the mergers; and b. the amount calculated by solving for A in the following formula: Award[A]=(Monetary Fund[M]+Award[A]-Look Through[L])*Percentage[P] Whereas A shall be the amount of the Additional Fee (excluding the $100,000 award for the agreement by the Sierra board of directors to appoint one independent director of MCC who will be selected by the independent director of Sierra on the board of directors of the post-merger company upon the closing of the Mergers); M shall be the sum of (i) the $17 million cash component of the Settlement Fund and (ii) the value of the post-merger company stock component of the Settlement Fund, which shall be calculated as the product of the VPS (as defined below) and 4,709,576.14 (the number of shares of post-merger company’s stock comprising the stock component of the net settlement amount); L shall be the amount representing the estimated value of the decrease in shares to be received by eligible class members arising by operation of the change in the “Exchange Ratio” under the Amended MCC Merger Agreement, calculated as follows: L = ((ES * 68%) - (ES * 66%)) * VPS Where: ES shall be the number of eligible shares; VPS shall be the pro forma net asset value per share of the post-merger company’s common stock as of the closing as reported in the public disclosure filed nearest in time and after the closing (the “Closing NAV Disclosure”); and P shall equal 0.26 The Contingent Fee Award is contingent upon the closing of the MCC Merger. Payment of the Contingent Fee Award will be made in two stages. First, within five ( 5 ) business days of the establishment of the Settlement Fund, MCC or its successor shall (i) pay the plaintiffs’ counsel an estimate of the Contingent Fee Award (the “Additional Fee Estimate”), less twenty ( 20 ) percent (the “Additional Fee Estimate Payment”), and (ii) deposit the remaining twenty ( 20 ) percent of the Additional Fee Estimate into escrow (the “Escrowed Fee”). For purposes of calculating such estimate, MCC or its successor shall use the formula set above, except that VPS shall equal the pro forma net asset value of the post-merger company’s common stock as reported in the public disclosure filed nearest in time and prior to the closing (the “Closing NAV Estimate”). Second, within five ( 5 ) business days of the Closing NAV Disclosure (as defined in the Order and Final Judgment), (i) if the Additional Fee is greater than the Additional Fee Estimate Payment, an amount of the Escrowed Fee shall be released to plaintiffs’ counsel such that the total payments made to plaintiffs’ counsel equal the Additional Fee and the remainder of the Escrowed Fee, if any, shall be released to MCC or its successor, (ii) if the Additional Fee is less than the Additional Fee Estimate Payment, plaintiffs’ counsel shall return to MCC or its successor the difference between the Additional Fee Estimate and the Additional Fee and the Escrowed Fee shall be released to MCC or its successor, or (iii) if the Additional Fee is equal to the Additional Fee Estimate Payment, the Escrowed Fee shall be released to MCC or its successor. On January 17, 2020, MCC and Sierra filed a notice of appeal with the Delaware Supreme Court from those provisions of the Order and Final Judgment with respect to the Contingent Fee Award. On March 1, 2019, Marilyn Adler, a former employee who served as a Managing Director of Medley Capital LLC, filed suit in the New York Supreme Court, Commercial Part, against Medley Capital LLC, MCC Advisors, Medley SBIC GP, LLC, MMC, the Company, as well as Brook Taube, and Seth Taube, individually. The action is captioned in Marilyn S. Adler v. Medley Capital LLC et al. (Supreme Court of New York, March 2019). In her complaint, Ms. Adler alleged that she was due in excess of $6.5 million in compensation based upon her role with Medley’s SBIC Fund. Her claims were for breach of contract, unjust enrichment, conversion, tortious interference, as well as a claim for an accounting of funds maintained by the defendants. The Company denied the allegations and asserted counterclaims against Ms. Adler for breach of contract and breach of fiduciary duties. In response to the Company’s motion to dismiss the breach of contract claim, Ms. Adler has conceded there was no written contract. After Medley filed its counterclaims, on February 7, 2020, the parties reached a settlement, exchanged mutual releases and dismissed the Adler litigation with prejudice. Medley did not make any payment to or for the benefit of Adler whatsoever in connection with the settlement. In connection with the settlement, Medley released Adler from certain obligations under a Confidentiality, Non-Interference, and Invention Assignment Agreement between Adler and Medley and Adler paid Medley an undisclosed amount While management currently believes that the ultimate outcome of these proceedings will not have a material adverse effect on the Company’s consolidated financial position or overall trends in consolidated results of operations, litigation is subject to inherent uncertainties. The Company reviews relevant information with respect to litigation and regulatory matters on a quarterly and annual basis. The Company establishes liabilities for litigation and regulatory actions when it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated. For matters where a loss is believed to be reasonably possible, but not probable, no liability is established. Employment Agreements In connection with the MDLY Merger, certain pre-IPO owners entered into employment agreements that would become effective upon the closing date of the MDLY Merger (the "Effective Date"). Each employment agreement sets forth a base salary, which is subject to change at the discretion of the board of directors or compensation committee of the Combined Company or the Sierra/MDLY Company, as applicable. The employment agreements provide for an initial term of 24 months (or 30 months in the case of the Chief Executive Officer) following the Effective Date. Upon effectiveness of the employment agreements, the combined initial base salaries of the pre-IPO members would be $2.5 million . Under the employment agreements, each pre-IPO owner is eligible to receive each year a short-term incentive paid in cash and a long-term incentive in the form of an equity award, each paid after the end of the year. Each employment agreement provides that the board of directors or compensation committee of the Combined Company or the Sierra/MDLY Company, as applicable, will establish a target annual bonus for each year of no less than a specified percentage of each pre-IPO owner's base salary and will establish performance and other objectives for the year for such annual bonus, in consultation with the management of the Combined Company or the Sierra/MDLY Company, as applicable. No annual bonuses would be earned unless such pre-IPO owner remains employed through the date of payment. The employment agreements also set forth a dollar amount of annual bonuses for 2019, payable in 2020, that the board of directors or the compensation committee of the Combined Company or the Sierra/MDLY Company, as applicable may increase in recognition of performance in excess of performance objectives. As of December 31, 2019, the Company did not accrue for any bonuses to any pre-IPO members as the 2019 bonus amounts provided that the employment agreements are not effective until the closing of the MDLY Merger. As of December 31, 2019 there were no amounts due under these employment agreements as the MDLY Merger had not closed rendering these contracts not effective. The long-term equity incentive will be made in the form of a restricted stock unit award, vesting in three annual installments on December 31, 2020, December 31, 2021 and December 31, 2022. The cash and equity award portions of the annual bonuses paid under the employment agreements will be subject to recoupment by the Combined Company or the Sierra/MDLY Company, as applicable, to the extent required by applicable law (including without limitation Section 304 of the Sarbanes-Oxley Act and Section 954 of the Dodd-Frank Act) and/or the rules and regulations of the NYSE. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | RELATED PARTY TRANSACTIONS Substantially all of Medley’s revenue is earned through agreements with its non-consolidated funds for which it collects management and performance fees for providing asset management, advisory and other related services. Administration Agreements In January 2011 and April 2012, Medley entered into administration agreements with MCC (the “MCC Admin Agreement”) and Sierra (the “SIC Admin Agreement”), respectively, whereby, as part of its performance obligation to provide asset management, advisory and other related services, Medley agreed to provide administrative services necessary for the operations of MCC and Sierra. MCC and Sierra agreed to pay Medley for the costs and expenses incurred in providing such administrative services, including an allocable portion of Medley’s overhead expenses and an allocable portion of the cost of MCC and Sierra's officers and their respective staff. Additionally, Medley has entered into administration agreements with other entities that it manages (the “Funds Admin Agreements”), whereby Medley agreed to provide administrative services necessary for the operations of these entities. These entities agreed to reimburse Medley for the costs and expenses incurred in providing such administrative services, including an allocable portion of Medley’s overhead expenses and an allocable portion of the cost of these other vehicles' officers and their respective staffs. Medley records these administrative fees as revenue in the period when the performance obligation of providing such administrative services is satisfied and such revenue is included as a component of other revenues and fees on the consolidated statements of operations. Amounts due from these agreements are included as a component of other assets on the Company's consolidated balance sheets. Total revenues recorded under these agreements for the years ended December 31, 2019, 2018 and 2017 are reflected in the table below. For the Years Ended December 31, 2019 2018 2017 (in thousands) MCC Admin Agreement $ 2,830 $ 3,382 $ 3,799 SIC Admin Agreement 2,516 2,538 3,031 Fund Admin Agreements 979 976 1,264 Total administrative fees from related parties $ 6,325 $ 6,896 $ 8,094 Amounts due from related parties under these agreements are reflected in the table below. As of December 31, 2019 2018 (in thousands) Amounts due from MCC under the MCC Admin Agreement $ 444 $ 804 Amounts due from SIC under the SIC Admin Agreement 382 619 Amounts due from entities under the Fund Admin Agreements 247 222 Total administrative fees receivable $ 1,073 $ 1,645 Reimbursement Agreement In connection with the amended and restated limited liability agreement of Medley LLC, Medley LLC agreed to, at the sole discretion of the managing member, reimburse Medley Management Inc. for all expenses incurred, other than expenses incurred in connection with its income tax obligations. From time to time, the company may also advance funds to Medley Management Inc. to cover its operating needs. For the three years ended December 31, 2019, 2018 and 2017, the Company recorded reimbursable expenses of $6.6 million, $3.9 million and $1.9 million , respectively, which were recorded as a component of general, administrative and other expenses on the Company's consolidated statements of operations. As of December 31, 2019 and 2018, amounts due from Medley Management Inc. were $0.9 million and $0.8 million , respectively. Organization Agreement Pursuant to the organization agreement between Medley Management Inc. and Medley LLC, Medley Management Inc. may from time to time make grants of restricted stock units or other awards providing the holder with the contractual right to receive cash payments pursuant to an equity plan to employees, advisors or other persons, as defined, in respect of Medley LLC and its subsidiaries. These awards may entitle the holder thereof to receive dividends paid with respect to the shares of Class A common stock underlying such awards as if such holder were a holder of record of the underlying shares of Class A common stock. Medley LLC has agreed that it assumes any obligation to pay such dividend equivalent amounts to the holders of the respective awards. Additionally, pursuant to this agreement, the number of LLC Units held by Medley Management Inc., shall, at all times, equal the number of shares of Class A common stock outstanding Management fee Waiver During the first quarter of 2018, the Company voluntarily waived $0.4 million in management fees for MCC. There were no other management fee waivers during the years ended December 31, 2019, 2018 and 2017. Investments Refer to Note 4, Investments, for information related to the Company's investments in related parties. Exchange Agreement Prior to the completion of the Company's IPO, Medley LLC's limited liability agreement was restated among other things, to modify its capital structure by reclassifying the interests held by its then existing owners (i.e. the members of Medley prior to the IPO) into the LLC Units. Medley’s existing owners also entered into an exchange agreement under which they (or certain permitted transferees thereof) have the right (subject to the terms of the exchange agreement as described therein), to exchange their LLC Units for shares of Medley Management Inc.’s Class A common stock on a one -for-one basis at fair value, subject to customary conversion rate adjustments for stock splits, stock dividends and reclassifications. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES The Company is treated as a partnership for income tax purposes and is therefore not subject to U.S. federal, state and local income taxes. The Company is subject to New York City unincorporated business tax attributable to the Company's taxable income apportioned to New York City. The provision for (benefit from) income taxes consist of the following For the Years Ending December 31, 2019 2018 2017 Current tax provision $ 35 $ 862 $ 681 Deferred tax provision 3,524 (1,162 ) (85 ) Provision for (benefit from) income taxes $ 3,559 $ (300 ) $ 596 Deferred income taxes reflect the net effect of temporary differences between the tax basis of an asset or liability and its reported amount on the Company’s consolidated balance sheets. These temporary differences result in taxable or deductible amounts in future years. The significant components of the Company's deferred tax assets and liabilities included on its consolidated balance sheet are as follows: As of December 31, 2019 2018 Deferred tax assets (in thousands) Tax goodwill $ 1,488 $ 565 New York City unincorporated business tax 1,177 1,234 Unrealized losses 145 581 Stock-based compensation 197 216 Interest expense carryforward 453 223 Pending merger related costs 188 101 Other items 148 224 Gross deferred tax assets $ 3,796 $ 3,144 Deferred tax liability Accrued fee income $ 33 247 $ — Other items 78 60 Gros deferred tax liabilities 111 60 Less deferred tax valuation allowance $ (3,685 ) — Net deferred tax asset $ — $ 3,084 During the year ended December 31, 2019, the Company recorded a deferred tax asset of $0.4 million in connection with its acquisition of a minority interest holder's ownership interests in a consolidated subsidiary which occurred on December 31, 2018. The establishment of this deferred tax asset was recorded through an adjustment of $0.4 million to members deficit. After evaluating the quantitative and qualitative aspects of the adjustment, the Company concluded that its 2018 financial statements were not materially misstated and adjusted for the amount during the fourth quarter of 2019. Due to the uncertain nature of the ultimate realization of its net deferred tax assets, the Company has established a full valuation allowance, as of December 31, 2019, against the benefits of its deferred tax assets and will recognize these benefits only as reassessment demonstrates they are realizable. Ultimate realization is dependent upon several factors, among which is future earnings and reversing temporary differences. While the need for this valuation allowance is subject to periodic review, if the allowance is reduced, the tax benefits of the net deferred tax assets will be recorded in future operations as a reduction of the Company’s income tax expense. A reconciliation of the federal statutory tax rate to the effective tax rates for the years ended December 31, 2019, 2018 and 2017 are as follows: For the For the Year Ending December 31, 2019 2018 2017 Federal statutory rate 21.0 % 21.0 % 34.0 % Rate benefit from U.S. partnership operations (21.0 )% (21.0 )% (34.0 )% Partnership unincorporated business tax 1.0 % 1.4 % 3.1 % Valuation allowance (30.5 )% — % — % Effective tax rate (29.5 )% 1.4 % 3.1 % Interest expense and penalties related to income tax matters are recognized as a component of the provision for income taxes and were not significant during the years ended December 31, 2019, 2018 and 2017. As of and during the years ended December 31, 2019, 2018 and 2017, there were no uncertain tax positions taken that were not more likely than not to be sustained. The primary jurisdictions in which the Company operates in are the United States, New York, New York City, and California. |
REDEEMABLE NON-CONTROLLING INTE
REDEEMABLE NON-CONTROLLING INTERESTS | 12 Months Ended |
Dec. 31, 2019 | |
Temporary Equity Disclosure [Abstract] | |
Redeemable Non-controlling Interests | REDEEMABLE NON-CONTROLLING INTERESTS Changes in redeemable non-controlling interests during the years ended December 31, 2019, 2018 and 2017 are reflected in the table below. For the Years Ended December 31, 2019 2018 2017 (in thousands) Beginning balance $ 23,186 $ 53,741 30,805 Net loss attributable to redeemable non-controlling interests in consolidated subsidiaries (4,275 ) (11,362 ) 6,702 Contributions — — 23,000 Distributions (2,362 ) (5,953 ) (6,738 ) Change in fair value of available-for-sale securities — — (28 ) Fair value adjustment to redeemable non-controlling interests 812 (965 ) — Reclassification of redeemable non-controlling interest in SIC Advisors LLC, including fair value adjustment of $965, to accounts payable, accrued expenses and other liabilities — (12,275 ) — Reclassification of redeemable non-controlling interest in the Joint Venture, including fair value adjustment of $812, to accounts payable, accrued expenses and other liabilities (18,109 ) — — Ending balance $ (748 ) $ 23,186 $ 53,741 In January 2016, the Company executed an amendment to SIC Advisors' operating agreement which provided the Company with the right to redeem membership units owned by the minority interest holder. The Company’s redemption right is triggered by the termination of the dealer manager agreement between Sierra and SC Distributors LLC ("DMA Termination"), an affiliate of the minority interest holder. As a result of this redemption feature, the Company reclassified the non-controlling interest in SIC Advisors from the equity section to redeemable non-controlling interests in the mezzanine section of the consolidated balance sheet based on its fair value as of the amendment date. The fair value of the non-controlling interest was determined to be $12.2 million on the amendment date and was adjusted through a charge to members' deficit. On July 31, 2018, a DMA Termination event occurred and the membership units held by the minority interest holder were redeemed by Medley. In connection with the DMA Termination, the Company reclassified SIC Advisors' minority interest balance from redeemable non-controlling interests in the mezzanine section of its consolidated balance sheet to due to former minority interest holder (Note 10), a component of total liabilities, at its then fair value. The fair value of the non-controlling interest was determined to be $12.3 million on the DMA Termination date and was adjusted through a $1.0 million charge to members' deficit. During the year ended December 31, 2018, profits allocated to this non-controlling interest were $2.1 million and distributions paid were $2.3 million . During the year ended December 31, 2017, profits allocated to this non-controlling interest were $4.4 million and distributions paid were $4.3 million . There were no profits or distributions allocated to this non-controlling interest subsequent the Company's redemption of the membership units held by the former minority interest holder. As of December 31, 2019 and 2018, there was no balance of redeemable non-controlling interests in SIC Advisors. On June 3, 2016, the Company entered into a Master Investment Agreement with DB MED Investor I LLC and DB MED Investor II LLC (‘DB Med Investors’’) to invest up to $50.0 million in new and existing Medley managed funds (the ‘‘Joint Venture’’). The Company agreed to contribute up to $10.0 million and an interest in STRF Advisors LLC, the investment advisor to Sierra Total Return Fund, in exchange for common equity interests in the Joint Venture. On June 6, 2017, the Company entered into an amendment to its Master Investment Agreement with the Investors, which provided for, among other things, an increase in the Company’s capital contribution to up to $13.8 million and extended the term of the Joint Venture from seven to ten years. DB Med Investors agreed to invest up to $40.0 million in exchange for preferred equity interests in the Joint Venture. Total contributions to the Joint Venture amounted to $53.8 million and were used to purchase $51.8 million of MCC shares on the open market and seed fund $2.0 million to STRF. On account of the preferred equity interests, DB Med Investors was entitled to receive an 8% preferred distribution, 15% of the Joint Venture’s profits, and all of the profits from the contributed interest in STRF Advisors LLC. The Company could make a capital contribution to fund the 8% preferred distribution but was limited to one contribution in any rolling twelve month period without the prior written consent of DB Med Investors. Medley had the option, subject to certain conditions, to cause the Joint Venture to redeem the DB Med Investors’ interests in exchange for repayment of the outstanding investment amount at the time of redemption, plus certain other considerations. DB Med Investors had the right, after ten years , to redeem their interests in the Joint Venture. DB Med Investors also had the right upon the occurrence of certain events (the "Put Option Trigger Event") to redeem their interests in the Joint Venture. Upon a Put Option Trigger Event DB Med Investors have the right to exercise a put option in which they would be entitled to put their preferred interests back to the Joint Venture. The Joint Venture can satisfy the put in cash or in kind in an amount equal to the amount necessary to satisfy the Fund Share Interest Redemption Price, as defined. In July 2019, the Company made a capital contribution of $0.7 million to cover the 8% preferred distribution which was paid to the Investors. In October 2019, the Joint Venture did not make the 8% preferred distribution resulting in a Put Option Trigger Event. On October 22, 2019, Medley LLC, Medley Seed Funding I LLC (“Seed Funding I”), Medley Seed Funding II LLC (“Seed Funding II”), and Medley Seed Funding III LLC (“Seed Funding III”) received notice from DB Med Investors that they exercised their put option rights under the amended Master Investment Agreement (the “Agreement”). In connection with the exercise of DB Med Investors put option right, the Company reclassified the Joint Venture's minority interest balance from redeemable non-controlling interests in the mezzanine section of its consolidated balance sheet to due to DB Med Investors (Note 11), a component of accounts payable, accrued expenses and other liabilities, at its then fair value. The fair value of the non-controlling interest was determined to be $18.1 million on the date of the exercise of DB Med Investors put option right. The difference between fair value of the non-controlling interest and its carrying value of $0.8 million and was recorded as a reduction to members' deficit. As of December 31, 2018, DB Med Investors’ interest in the Joint Venture was $ 23.9 million and is included as a component of redeemable non-controlling interests on the Company’s consolidated balance sheets. During the years ended December 31, 2019 and 2018, losses allocated to this non-controlling interest were $4.2 million and $13.1 million , respectively. During the year ended December 31, 2017, profits allocated to this non-controlling interest was $2.7 million . During the years ended December 31, 2019, 2018 and 2017, distributions paid were $2.4 million , $3.7 million and $2.4 million , respectively. In October 2016, the Company executed an operating agreement for STRF Advisors LLC which provided the Company with the right to redeem membership units owned by the minority interest holder. The Company’s redemption right is triggered by the termination of the dealer manager agreement between STRF and SC Distributors LLC, an affiliate of the minority interest holder. As a result of this redemption feature, the non-controlling interest in STRF Advisors LLC is classified as a component of redeemable non-controlling interests in the mezzanine section of the balance sheet. During years ended December 31, 2019 , 2018 and 2017, net losses allocated to this redeemable non-controlling interest were $0.1 million , $0.3 million and $0.4 million , respectively. As of December 31, 2019 and 2018, the balance of the redeemable non-controlling interest in STRF Advisors LLC was $(0.7) million for each of the years then ended. |
MARKET AND OTHER RISK FACTORS
MARKET AND OTHER RISK FACTORS | 12 Months Ended |
Dec. 31, 2019 | |
Risks and Uncertainties [Abstract] | |
Market and Other Risk Factors | MARKET AND OTHER RISK FACTORS Due to the nature of the Medley funds’ investment strategy, their portfolio of investments has significant market and credit risk. As a result, the Company is subject to market and other risk factors, including, but not limited to the following: Market Risk The market price of investments may significantly fluctuate during the period of investment. Investments may decline in value due to factors affecting securities markets generally or particular industries represented in the securities markets. The value of an investment may decline due to general market conditions that are not specifically related to such investment, such as real or perceived adverse economic conditions, changes in the general outlook for corporate earnings, changes in interest or currency rates or adverse investor sentiment generally. They may also decline due to factors that affect a particular industry or industries, such as labor shortages or increased production costs and competitive conditions within an industry. Credit Risk There are no restrictions on the credit quality of the investments the Company intends to make. Investments may be deemed by nationally recognized rating agencies to have substantial vulnerability to default in payment of interest and/or principal. Some investments may have low-quality ratings or be unrated. Lower rated and unrated investments have major risk exposure to adverse conditions and are considered to be predominantly speculative. Generally, such investments offer a higher return potential than higher rated investments, but involve greater volatility of price and greater risk of loss of income and principal. In general, the ratings of nationally recognized rating organizations represent the opinions of agencies as to the quality of the securities they rate. Such ratings, however, are relative and subjective; they are not absolute standards of quality and do not evaluate the market value risk of the relevant securities. It is also possible that a rating agency might not change its rating of a particular issue on a timely basis to reflect subsequent events. The Company may use these ratings as initial criteria for the selection of portfolio assets for the Company but is not required to utilize them. Limited Liquidity of Investments The funds managed by the Company invest and intend to continue to invest in investments that may not be readily marketable. Illiquid investments may trade at a discount from comparable, more liquid investments and, at times there may be no market at all for such investments. Subordinate investments may be less marketable, or in some instances illiquid, because of the absence of registration under federal securities laws, contractual restrictions on transfer, the small size of the market or the small size of the issue (relative to issues of comparable interests). As a result, the funds managed by the Company may encounter difficulty in selling its investments or may, if required to liquidate investments to satisfy redemption requests of its investors or debt service obligations, be compelled to sell such investments at less than fair value. Counterparty Risk Some of the markets in which the Company, on behalf of its underlying funds, may affect its transactions are “over-the-counter” or “interdealer” markets. The participants in such markets are typically not subject to credit evaluation and regulatory oversight, unlike members of exchange-based markets. This exposes the Company to the risk that a counterparty will not settle a transaction in accordance with its terms and conditions because of a dispute over the terms of the applicable contract (whether or not such dispute is bona fide) or because of a credit or liquidity problem, causing the Company to suffer loss. Such “counterparty risk” is accentuated for contracts with longer maturities where events may intervene to prevent settlement, or where the Company has concentrated its transactions with a single or small group of counterparties. |
QUARTERLY FINANCIAL DATA (unaud
QUARTERLY FINANCIAL DATA (unaudited) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Data (unaudited) | QUARTERLY FINANCIAL DATA (UNAUDITED) The Company's condensed consolidated unaudited quarterly results of operations for 2019 and 2018 are as follows: For the Three Months Ended December 31, 2019 September 30, 2019 June 30, March 31, 2019 (Amounts in thousands) Revenues $ 10,654 $ 11,536 $ 12,882 $ 13,769 Expenses 11,279 12,493 11,064 11,275 Other (expenses) income, net (6,445 ) (924 ) (8,666 ) 1,245 (Loss) income before income taxes (7,070 ) (1,881 ) (6,848 ) 3,739 Net (loss) income (10,699 ) (1,853 ) (6,815 ) 3,748 Net (loss) income attributable to redeemable non-controlling interests and non-controlling interests in consolidated subsidiaries (3,836 ) 1,619 (5,674 ) 4,195 Net (loss) income attributable to Medley LLC $ (6,863 ) $ (3,472 ) $ (1,141 ) $ (447 ) For the Three Months Ended December 31, 2018 September 30, 2018 June 30, March 31, 2018 (Amounts in thousands) Revenues $ 12,565 $ 14,397 $ 15,151 $ 14,396 Expenses 14,058 12,485 11,649 12,840 Other (expenses) income, net (10,928 ) 956 (5,766 ) (11,007 ) (Loss) income before income taxes (12,421 ) 2,868 (2,264 ) (9,451 ) Net (loss) income (12,031 ) 2,676 (2,292 ) (9,321 ) Net (loss) income attributable to redeemable non-controlling interests and non-controlling interests in consolidated subsidiaries (7,971 ) 3,866 (2,464 ) (4,514 ) Net (loss) income attributable to Medley LLC $ (4,061 ) $ (1,190 ) $ 172 $ (4,807 ) |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | SUBSEQUENT EVENTS Management has evaluated subsequent events through the date of issuance of the consolidated financial statements included herein. There have been no subsequent events that occurred during such period that would require disclosure in this Form 10-K or would be required to be recognized in the condensed consolidated financial statements as of and for the year ended December 31, 2019, except as disclosed below. In connection with the exercise of DB Med Investors put option right in October 2019, as further discussed in Notes 11 and 16 to these consolidated financial statements, STRF had filed an application with the Securities and Exchange Commission ("SEC") on December 26, 2019, and an amendment on February 24, 2020, requesting an order under section 8(f) of the Investment Company Act of 1940 (the "Act") declaring that it has ceased to be an investment company. On March 25, 2020, the SEC ordered, under the Act, that STRF's application registration under the Act shall forthwith cease to be in effect. In connection with this deregistration, the Company will transfer the shares of STRF and remaining of cash of less than $0.1 million held by Seed Funding II LLC to DB Investors in full satisfaction of the liability due to DB Med Investors (Note 11), which is expected to place before March 31, 2020. As a result of the transfer the shares of STRF to DB Med Investors, the Company will no longer consolidate STRF in its consolidated financial statements. As a result of the spread of the COVID-19 coronavirus, economic uncertainties have arisen which may have a negative impact on the Company’s operations. Other financial impacts could occur though such potential impacts (and the possible nature and extent thereof) are unknown at this time. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation |
Reclassification of Prior Period Presentation | Reclassification of Prior Period Presentation Performance fee compensation reported in the prior period has been reclassified to compensation and benefits to conform to the current period presentation in the consolidated statements of operations. This reclassification had no effect on the reported results of operations. |
Principles of Consolidation | Principles of Consolidation In accordance with Accounting Standards Codification (“ASC”) 810, Consolidation , the Company consolidates those entities where it has a direct and indirect controlling financial interest based on either a variable interest model or voting interest model. As such, the Company consolidates entities that the Company concludes are variable interest entities (“VIEs”), for which the Company is deemed to be the primary beneficiary and entities in which it holds a majority voting interest or has majority ownership and control over the operational, financial and investing decisions of that entity. For legal entities evaluated for consolidation, the Company must determine whether the interests that it holds and fees paid to it qualify as a variable interest in an entity. This includes an evaluation of the management fee and performance fee paid to the Company when acting as a decision maker or service provider to the entity being evaluated. If fees received by the Company are customary and commensurate with the level of services provided, and the Company does not hold other economic interests in the entity that would absorb more than an insignificant amount of the expected losses or returns of the entity, the interest that the Company holds would not be considered a variable interest. The Company factors in all economic interests including proportionate interests through related parties, to determine if fees are considered a variable interest. An entity in which the Company holds a variable interest is a VIE if any one of the following conditions exist: (a) the total equity investment at risk is not sufficient to permit the legal entity to finance its activities without additional subordinated financial support, (b) the holders of the equity investment at risk have the right to direct the activities of the entity that most significantly impact the legal entity’s economic performance, or (c) the voting rights of some investors are disproportionate to their obligation to absorb losses or rights to receive returns from a legal entity. For limited partnerships and other similar entities, non-controlling investors must have substantive rights to either dissolve the fund or remove the general partner (“kick-out rights”) in order to not qualify as a VIE. For those entities that qualify as a VIE, the primary beneficiary is generally defined as the party who has a controlling financial interest in the VIE. The Company is generally deemed to have a controlling financial interest if it has the power to direct the activities of a VIE that most significantly impact the VIE’s economic performance, and the obligation to absorb losses or receive benefits from the VIE that could potentially be significant to the VIE. The Company determines whether it is the primary beneficiary of a VIE at the time it becomes initially involved with the VIE and reconsiders that conclusion continuously. The primary beneficiary evaluation is generally performed qualitatively on the basis of all facts and circumstances. However, quantitative information may also be considered in the analysis, as appropriate. These assessments require judgment. Each entity is assessed for consolidation on a case-by-case basis. For those entities evaluated under the voting interest model, the Company consolidates the entity if it has a controlling financial interest. The Company has a controlling financial interest in a voting interest entity (“VOE”) if it owns a majority voting interest in the entity. |
Consolidated and Non-Consolidated Variable Interest Entities | Non-Consolidated Variable Interest Entities The Company holds interests in certain VIEs that are not consolidated because the Company is not deemed to be the primary beneficiary. The Company's interest in these entities is in the form of insignificant equity interests and fee arrangements. The maximum exposure to loss represents the potential loss of assets by the Company relating to these non-consolidated entities. Consolidated Variable Interest Entities As of December 31, 2019 , Medley LLC had seven subsidiaries, Medley Seed Funding I LLC, Medley Seed Funding II LLC, STRF Advisors LLC, Medley Caddo Investors Holdings 1 LLC, Medley Avantor Investors LLC, Medley Cloverleaf Investors LLC and Medley Real D Investors LLC, which are consolidated VIEs. Each of these entities was organized as a limited liability company and was legally formed to either manage a designated fund or to strategically invest capital as well as isolate business risk. As of December 31, 2019 , total assets and total liabilities, after eliminating entries, of these VIEs reflected in the consolidated balance sheets were $1.2 million and less than $0.1 million , respectively. As of December 31, 2018, Medley LLC had five majority owned subsidiaries, Medley Seed Funding I LLC, Medley Seed Funding II LLC, STRF Advisors LLC, Medley Caddo Investors Holdings 1 LLC and Medley Avantor LLC. As of December 31, 2018 , total assets and total liabilities, after eliminating entries, of these VIEs reflected in the consolidated balance sheets were $22.6 million and less than $0.1 million , respectively. Except to the extent of the assets of these VIEs that are consolidated, the holders of the consolidated VIEs’ liabilities generally do not have recourse to the Company. |
Seed Investments | Seed Investments The Company accounts for seed investments through the application of the voting interest model under ASC 810-10-25-1 through 25-14 and consolidates a seed investment when the investment advisor holds a controlling interest, which is, in general, 50% or more of the equity in such investment. For seed investments in which the Company does not hold a controlling interest, the Company accounts for such seed investment under the equity method of accounting, at its ownership percentage of such seed investment’s net asset value. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Management’s estimates are based on historical experience and other factors, including expectations of future events that management believes to be reasonable under the circumstances. These assumptions and estimates also require management to exercise judgment in the process of applying the Company’s accounting policies. Significant estimates and assumptions by management affect the carrying value of investments, deferred tax assets, performance compensation payable and certain accrued liabilities. Actual results could differ from these estimates, and such differences could be material. |
Non-Controlling Interests in Consolidated Subsidiaries and Redeemable Non-Controlling Interests | Non-Controlling Interests in Consolidated Subsidiaries Non-controlling interests in consolidated subsidiaries represent the component of equity in such consolidated entities held by third-parties and certain employees. These interests are adjusted for contributions to and distributions from Medley entities and are allocated income or loss from Medley entities based on their ownership percentages. Redeemable Non-Controlling Interests Redeemable non-controlling interests represents interests of certain third parties that are not mandatorily redeemable but redeemable for cash or other assets at a fixed or determinable price or a fixed or determinable date, at the option of the holder or upon the occurrence of an event that is not solely within the control of the Company. These interests are classified in the mezzanine section on the Company's consolidated balance sheets. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents include liquid investments in money market funds and demand deposits. The Company had cash balances with financial institutions in excess of Federal Deposit Insurance Corporation insured limits as of December 31, 2019 and 2018. The Company monitors the credit standing of these financial institutions and has not experienced, and has no expectations of experiencing, any losses with respect to such balances. |
Investments | Investments Investments include equity method investments that are not consolidated but over which the Company exerts significant influence. The Company measures the carrying value of its privately-held equity method investments by recording its share of the earnings or losses of its investee in the periods for which they are reported by the investee in the investee's financial statements rather than in the period in which an investee declares a dividend or distribution. For the Company's public non-traded equity method investment, it measures the carrying value of such investment at Net Asset Value ("NAV") per share. Unrealized appreciation (depreciation) resulting from changes in fair value of the equity method investments is reflected as a component of investment income in the consolidated statements of operations along with the income and expense allocations from such investments. The carrying amounts of equity method investments are reflected in Investments, at fair value on the Company's consolidated balance sheets. As the underlying entities that the Company manages and invests in are, for U.S. GAAP purposes, primarily investment companies which reflect their investments at estimated fair value, the carrying value of the Company’s equity method investments in such entities approximates fair value. The Company evaluates its equity-method investments for impairment whenever events or changes in circumstances indicate that the carrying amounts of such investments may not be recoverable. For presentation in its consolidated statements of cash flows, the Company treats distributions received from certain equity method investments using the cumulative earnings approach. Under the cumulative earnings approach, an investor would compare the distributions received to its cumulative equity-method earnings since inception. Any distributions received up to the amount of cumulative equity earnings would be considered a return on investment and classified in operating activities. Any excess distributions would be considered a return of investment and classified in investing activities. Investments also include publicly traded common stock. The Company measures the fair value of its publicly traded common stock at the quoted market price on the primary market or exchange on which the underlying shares trade. Any realized gains (losses) from the sale of investments and unrealized appreciation (depreciation) resulting from changes in fair value are recorded in other income (expense), net. |
Revenues | Revenues Effective January 1, 2018, the Company recognizes revenue in accordance with ASC 606, Revenues from Contracts with Customers . The Company recognizes revenue under the core principle of depicting the transfer of promised goods or services to customers in an amount that reflects the consideration to which it expects to be entitled in exchange for such goods or services. To achieve this, the Company applies a five step approach: (1) identify the contract(s) with a customer, (2) identify the performance obligations within the contract, (3) determine the transaction price, (4) allocate the transaction price to the separate performance obligations and (5) recognize revenue when, or as, each performance obligation is satisfied. Carried interest are performance based fees that represent a capital allocation of income to the general partner or investment manager. Such fees are accounted for under ASC 323, Investments - Equity Method and Joint Ventures and, therefore, are not in the scope of ASC 606. As a result of the adoption of this new revenue guidance, the Company recorded a cumulative effect decrease to equity of $3.6 million , net of benefit from income taxes of $0.1 million , as of January 1, 2018, which relates to (1) certain performance fee revenue that would not have met the “probable that significant reversal will not occur” criteria of $3.0 million and (2) the reversal of reimbursable fund formation costs which were deferred on the Company’s consolidated balance sheet of $0.7 million . Management Fees Medley provides investment management services to both public and private investment vehicles. Management fees include base management fees, other management fees, and Part I incentive fees, as described below. Base management fees are calculated based on either (i) the average or ending gross assets balance for the relevant period, (ii) limited partners’ capital commitments to the funds, (iii) invested capital, (iv) NAV or (v) lower of cost or market value of a fund’s portfolio investments. Depending upon the contracted terms of the investment management agreement, management fees are paid either quarterly in advance or quarterly in arrears, and are recognized as earned over the period the services are provided. Certain management agreements provide for Medley to receive other management fee revenue derived from up front origination fees paid by the funds' and/or separately managed accounts' underlying portfolio companies. These fees are recognized when the Company becomes entitled to such fees. Certain management agreements also provide for Medley to receive Part I incentive fee revenue derived from net investment income (excluding gains and losses) above a hurdle rate. As it relates to MCC, these fees are subject to netting against realized and unrealized losses. Part I incentive fees are paid quarterly and are recognized as earned in the period the services are provided. Performance Fees Performance fees are contractual fees which do not represent a capital allocation of income to the general partner or investment manager that are earned based on the performance of certain funds, typically, the Company’s separately managed accounts. Performance fees are earned based on each fund's performance during the period, subject to the achievement of minimum return levels in accordance with the respective terms set out in each fund’s investment management agreement. Other Revenues and Fees Medley provides administrative services to certain affiliated funds and is reimbursed for direct and allocated expenses incurred in providing such administrative services, as set forth in the respective underlying agreements. These fees are recognized as revenue in the period administrative services are rendered. Medley also acts as the administrative agent on certain deals for which Medley may earn loan administration fees and transaction fees. Medley may also earn consulting fees for providing non-advisory services related to its managed funds. These fees are recognized as revenue over the period the services are performed. Investment Income (loss) - Carried Interest Carried interest are performance based fees that represent a capital allocation of income to the general partner or investment manager. Carried interest are allocated to the Company based on cumulative fund performance to date, subject to the achievement of minimum return levels in accordance with the respective terms set out in each fund’s governing documents and are accounted for under the equity method of accounting . Accordingly, these performance fees are reflected as carried interest within investment income on the Company's consolidated statements of operations and balances due for such fees are included as a part of equity method investments within Investments, at fair value on the Company's consolidated balance sheets. The Company records carried interest based upon an assumed liquidation of that fund's net assets as of the reporting date, regardless of whether such amounts have been realized. For any given period, carried interest on the Company's consolidated statements of operations may include reversals of previously recognized carried interest due to a decrease in the value of a particular fund that results in a decrease of cumulative fees earned to date. Since fund return hurdles are cumulative, previously recognized carried interest also may be reversed in a period of appreciation that is lower than the particular fund's hurdle rate. Carried interest received in prior peri ods may be required to be returned by the Company in future periods if the funds’ investment performance declines below certain levels. Each fund is considered separately in this regard and, for a given fund, carried interest can never be negative over the life of a fund. If upon a hypothetical liquidation of a fund’s investments, at their then current fair values, previously recognized and distributed carried interest would be required to be returned, a liability is established for the potential clawback obligatio n. During the year ended December 31, 2019, the Company received a carried interest distribution of $0.3 million from one of its managed funds, which has been fully liquidated as of December 31, 2019. Prior to the receipt of this distribution, the C ompany had not received any carried interest distributions, except for tax distributions related to the Company’s allocation of net income, which included an allocation of carried interest. Pursuant to the organizational documents of each respective fund, a portion of these tax distributions may be subject to clawback. As of December 31, 2019 and 2018, the Company had accrued $7.2 million for clawback obligations that would need to be paid if the funds were liquidated at fair value as of the end of the reporting period. The Company’s actual obligation, however, would not become payable or realized until the end of a fund’s life. For each of the years ended December 31, 2019 , 2018 and 2017, the Company's reversal of previously recognized carried interest were not in excess of $0.1 million . Investment Income (loss) - Other Other investment income is comprised of unrealized appreciation (depreciation) resulting from changes in fair value of the Company's equity method investments in addition to the income and expense allocations from such investments. |
Stock-based Compensation | Stock-based Compensation Stock-based compensation expense relating to equity based awards are measured at fair value as of the grant date, reduced for actual forfeitures in the period they occur, and expensed over the requisite service period on a straight-line basis as a component of compensation and benefits on the Company's consolidated statements of operations. |
Income Taxes | Income Taxes The Company is treated as a partnership for income tax purposes and is therefore not subject to U.S. federal, state or local income taxes since all income, gains and losses are passed through to its members. However, a portion of taxable income from Medley LLC and its subsidiaries are subject to New York City's unincorporated business tax, which is included in the Company's provision for income taxes. The Company accounts for income taxes using the asset and liability approach, which requires the recognition of tax benefits or expenses for temporary differences between the financial reporting and tax basis of assets and liabilities. A valuation allowance is established when necessary to reduce deferred tax assets to the amounts expected to be realized. The Company also recognizes a tax benefit from uncertain tax positions only if it is “more likely than not” that the position is sustainable based on its technical merits. The Company’s policy is to recognize interest and penalties on uncertain tax positions and other tax matters as a component of its provision for income taxes. For interim periods, the Company accounts for income taxes based on its estimate of the effective tax rate for the year. Discrete items and changes in its estimate of the annual effective tax rate are recorded in the period in which they occur. |
Recently Issued Accounting Pronouncements Adopted and Not Yet Adopted | Recently Issued Accounting Pronouncements Adopted as of January 1, 2019 In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) to increase the transparency and comparability among organizations as it relates to lease assets and lease liabilities, by requiring lessees to recognize a right-of-use asset and lease liability for all leases with an expected term of more than 12 months. Effective January 1, 2019, the Company adopted this guidance using a modified retrospective approach, which was required for all leases that exist at or commence after the date of the initial application with an option to use certain practical expedients. The Company has elected to use these practical expedients, which allow the Company to treat lease and non-lease components of its leases as a single component, have the ability to use hindsight in determining the lease term and assessing impairment of right-of-use assets, not to reassess lease classification or whether an arrangement is or contains a lease and not to reassess its initial accounting for direct lease costs. The adoption of the new lease standard at January 1, 2019 resulted in the recognition of right-of-use assets and lease liabilities of $8.2 million and $10.2 million , respectively, consisting primarily of operating leases related to the rental of office space. The adoption of this guidance did not have a significant impact on the Company's consolidated statements of operations or cash flows. Additionally, this adoption did not impact any covenants associated with the Company's financial obligations. Recently Issued Accounting Pronouncements Not Yet Adopted In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework –Changes to the Disclosure Requirements for Fair Value Measurement . This ASU modifies the disclosure requirements in Topic 820, Fair Value Measurement , by removing certain disclosure requirements related to the fair value hierarchy, modifying existing disclosure requirements related to measurement uncertainty, and adding new disclosure requirements. This ASU is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted. The Company adopted this ASU effective January 1, 2020 and its adoption is not expected to have a material impact on the Company's consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments . The amendments in this ASU require the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts and requires enhanced disclosures related to the significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of an organization’s portfolio. In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. The amendments in this ASU are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. This ASU is effective for the Company on January 1, 2021 and will be adopted prospectively. The Company does not expect the adoption of this ASU to have a material impact on its consolidated financial statements. In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (a consensus of the FASB Emerging Issues Task Force). This ASU aligns the accounting for costs incurred to implement a cloud computing arrangement that is a service arrangement with the guidance on capitalizing costs associated with developing or obtaining internal-use software. It addresses when costs should be capitalized rather than expensed, the term to use when amortizing capitalized costs, and how to evaluate the unamortized portion of these capitalized implementation costs for impairment. This ASU also includes guidance on how to present implementation costs in the financial statements and creates additional disclosure requirements. The accounting for the service element of a hosting arrangement that is a service contract is not affected by these amendments. Early adoption is permitted and can be applied either retrospectively or prospectively. The Company adopted this ASU on January 1, 2020 and has applied this new ASU on a prospective basis. The Company does not expect the adoption of this ASU to have a material impact on its consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes . The guidance in this ASU clarifies and amends existing guidance. It is effective for public entities for annual reporting periods beginning after December 15, 2020 and interim periods within those reporting periods, with early adoption permitted. While the Company does not expect the adoption of ASU 2019-12 to have a material effect on its business, it is evaluating the potential impact that ASU 2019-12 may have on its financial position, results of operations and cash flows. The Company does not believe any other recently issued, but not yet effective, revisions to authoritative guidance will have a material effect on its consolidated balance sheets, results of operations or cash flows. |
Fair Value Measurements | Fair value is the price that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Where available, fair value is based on observable market prices or parameters, or derived from such prices or parameters. Where observable prices or inputs are not available, valuation models are applied. These valuation models involve some level of management estimation and judgment, the degree of which is dependent on the price transparency for the instruments or market and the instruments’ complexity. The Company’s fair value analysis includes an analysis of the value of any unfunded loan commitments. Financial investments recorded at fair value in these consolidated financial statements are categorized for disclosure purposes based upon the level of judgment associated with the inputs to the valuation of the investment as of the measurement date. Investments which are valued using NAV as a practical expedient are excluded from this hierarchy: • Level I – Valuations based on quoted prices in active markets for identical assets or liabilities at the measurement date. • Level II – Valuations based on inputs other than quoted prices in active markets included in Level I, which are either directly or indirectly observable at the measurement date. This category includes quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in non-active markets including actionable bids from third parties for privately held assets or liabilities, and observable inputs other than quoted prices such as yield curves and forward currency rates that are entered directly into valuation models to determine the value of derivatives or other assets or liabilities. • Level III – Valuations based on inputs that are unobservable and where there is little, if any, market activity at the measurement date. The inputs for the determination of fair value may require significant management judgment or estimation and are based upon management’s assessment of the assumptions that market participants would use in pricing the assets and liabilities. These investments include debt and equity investments in private companies or assets valued using the Market or Income Approach and may involve pricing models whose inputs require significant judgment or estimation because of the absence of any meaningful current market data for identical or similar investments. The inputs in these valuations may include, but are not limited to, capitalization and discount rates, beta and EBITDA multiples. The information may also include pricing information or broker quotes which include a disclaimer that the broker would not be held to such a price in an actual transaction. The non-binding nature of consensus pricing and/or quotes accompanied by disclaimer would result in classification as Level III information, assuming no additional corroborating evidence. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Condensed Balance Sheet of STRF | The condensed balance sheet of STRF as of December 31, 2019 and 2018 is presented in the table below. As of December 31, 2019 2018 Assets (in thousands) Cash and cash equivalents $ 682 $ 274 Investments, at fair value 1,441 1,952 Other assets 29 248 Total assets $ 2,152 $ 2,474 Liabilities and Equity Accounts payable, accrued expenses and other liabilities $ 342 $ 330 Equity 1,810 2,144 Total liabilities and equity $ 2,152 $ 2,474 |
REVENUES FROM CONTRACTS WITH _2
REVENUES FROM CONTRACTS WITH CUSTOMERS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Revenue from Contracts with Customers Disaggregated by Type of Customer | The following table presents the Company's revenue from contracts with customers disaggregated by type of customer for the years ended December 31, 2019 and 2018: Permanent Long-dated SMAs Other Total For the year ended December 31, 2019 (in thousands) Management fees $ 27,208 $ 6,641 $ 5,624 $ — $ 39,473 Other revenues and fees 6,325 — — 3,378 9,703 Total revenues from contracts with customers $ 33,533 $ 6,641 $ 5,624 $ 3,378 $ 49,176 For the year ended December 31, 2018 Management fees $ 32,471 $ 8,122 $ 6,492 $ — $ 47,085 Other revenues and fees 6,895 — — 3,608 10,503 Total revenues from contracts with customers $ 39,366 $ 8,122 $ 6,492 $ 3,608 $ 57,588 |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Schedule of Investments [Abstract] | |
Composition of Investments | Investments consist of the following: As of December 31, 2019 2018 (in thousands) Equity method investments, at fair value $ 11,650 $ 13,422 Investment in shares of MCC, at fair value — 20,633 Investment held at cost less impairment 196 418 Investments of consolidated fund 1,441 1,952 Total investments, at fair value $ 13,287 $ 36,425 |
Equity Method Investments | The following table provides summarized balance sheet information for the Company's equity method investees, as of December 31, 2019 and 2018. As of December 31, 2019 2018 Balance Sheet Data (in thousands) Investments, at fair value $ 1,020,709 $ 1,417,176 Cash 255,738 97,889 Other assets 37,139 57,677 Total assets $ 1,313,586 $ 1,572,742 Debt $ 338,988 $ 367,424 Other liabilities 13,775 20,686 Total liabilities 352,763 388,110 Net assets $ 960,823 $ 1,184,632 The following table provides summarized income statement information for the Company's equity method investees, for the years ended December 31, 2019, 2018 and 2017. For the Years Ended December 31, 2019 2018 2017 Summary of Operations (in thousands) Total revenues $ 110,877 $ 142,431 $ 162,386 Total expenses 59,684 64,339 64,517 Net realized and unrealized gain/(loss) on investments (104,228 ) (131,554 ) (89,508 ) Net income (loss) $ (53,035 ) $ (53,462 ) $ 8,361 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Summary of Fair Value Hierarchy of Financial Assets Measured at Fair Value | The following tables summarize the fair value hierarchy of the Company's financial assets and liabilities measured at fair value: As of December 31, 2019 Level I Level II Level III Total Assets (in thousands) Investments of consolidated fund $ 110 $ — $ 1,331 $ 1,441 Total Assets $ 110 $ — $ 1,331 $ 1,441 Liabilities Due to DB Med Investors (Note 11) $ — $ — $ 1,750 $ 1,750 Total Liabilities $ — $ — $ 1,750 $ 1,750 As of December 31, 2018 Level I Level II Level III Total Assets (in thousands) Investments of consolidated fund $ 258 $ — $ 1,694 $ 1,952 Investment in shares of MCC 20,633 — — 20,633 Total Assets $ 20,891 $ — $ 1,694 $ 22,585 |
Summary of Changes in Fair Value of Financial Assets Categorized within Level 3 | The following is a summary of changes in fair value of the Company's financial assets and liabilities that have been categorized within Level III of the fair value hierarchy: Level III Financial Assets as of December 31, 2019 Balance at December 31, 2018 Purchases Transfers In or (Out) of Level III Realized and Unrealized Depreciation Sale of Level III Assets Balance at December 31, 2019 (in thousands) Investments of consolidated fund $ 1,694 539 — (125 ) (777 ) $ 1,331 Level III Financial Assets as of December 31, 2019 Balance at December 31, 2018 Reclassification from Redeemable Non-controlling Interests Payments Realized and Unrealized Depreciation Balance at December 31, 2019 (in thousands) Due to DB Med Investors (Note 11) $ — 18,109 (16,537 ) 178 $ 1,750 |
Fair Value Measurement Inputs and Valuation Techniques [Table Text Block] |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Summary of Components of Lease Cost and Supplemental Balance Sheet and Other Information Related to Leases | The components of lease cost and other information for the year ended December 31, 2019 are as follows (in thousands): Lease cost Operating lease costs $ 2,554 Variable lease costs — Sublease income (454 ) Total lease cost $ 2,100 Supplemental balance sheet information related to leases as of December 31, 2019 are as follows: Weighted-average remaining lease term (in years) 3.5 Weighted-average discount rate 8.2 % |
Summary of Future Payments for Operating Leases | Future payments for operating leases as of December 31, 2019 are as follows (in thousands): 2020 $ 2,846 2021 2,483 2022 2,441 2023 1,822 Total future lease payments 9,592 Less imputed interest (1,325 ) Operating lease liabilities, as reported $ 8,267 |
OTHER ASSETS (Tables)
OTHER ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Components of Other Assets | Other assets consist of the following: As of December 31, 2019 2018 (in thousands) Fixed assets, net of accumulated depreciation and amortization of $3,847 and $3,446, respectively $ 2,564 $ 3,140 Security deposits 1,975 1,975 Administrative fees receivable (Note 13) 1,073 1,645 Deferred tax assets, net (Note 14) — 3,144 Due from affiliates (Note 13) 2,693 2,215 Prepaid expenses and income taxes 746 761 Other assets 676 1,265 Total other assets $ 9,727 $ 14,145 |
SENIOR UNSECURED DEBT (Tables)
SENIOR UNSECURED DEBT (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Senior Unsecured Debt | The carrying value of the Company’s senior unsecured debt consist of the following: As of December 31, 2019 2018 (in thousands) 2026 Notes, net of unamortized discount and debt issuance costs of $2,584 and $2,946, respectively $ 51,011 $ 50,649 2024 Notes, net of unamortized premium and debt issuance costs of $1,629 and $2,031 respectively 67,371 66,969 Total senior unsecured debt $ 118,382 $ 117,618 Loans payable consist of the following: As of December 31, 2019 2018 (in thousands) Non-recourse promissory notes, net of unamortized discount of $108 at December 31, 2018 $ 10,000 $ 9,892 Total loans payable $ 10,000 $ 9,892 |
LOANS PAYABLE (Tables)
LOANS PAYABLE (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Loans Payable | The carrying value of the Company’s senior unsecured debt consist of the following: As of December 31, 2019 2018 (in thousands) 2026 Notes, net of unamortized discount and debt issuance costs of $2,584 and $2,946, respectively $ 51,011 $ 50,649 2024 Notes, net of unamortized premium and debt issuance costs of $1,629 and $2,031 respectively 67,371 66,969 Total senior unsecured debt $ 118,382 $ 117,618 Loans payable consist of the following: As of December 31, 2019 2018 (in thousands) Non-recourse promissory notes, net of unamortized discount of $108 at December 31, 2018 $ 10,000 $ 9,892 Total loans payable $ 10,000 $ 9,892 |
DUE TO FORMER MINORITY INTERE_2
DUE TO FORMER MINORITY INTEREST HOLDER (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Former Minority Interest | This balance consists of the following: As of December 31, 2019 2018 (in thousands) Due to former minority interest holder, net of unamortized discount of $1,480 and $2,598, respectively $ 8,145 $ 11,402 Total due to former minority interest holder $ 8,145 $ 11,402 |
Schedule of Future Payments Due to Former Minority Interest Holder | As of December 31, 2019 future payments due to the former minority interest holder are as follows (in thousands): 2020 $ 3,500 2021 3,500 2022 2,625 Total future payments $ 9,625 |
ACCOUNTS PAYABLE, ACCRUED EXP_2
ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Payables and Accruals [Abstract] | |
Components of Accounts Payable, Accrued Expenses and Other Liabilities | Accounts payable, accrued expenses and other liabilities consist of the following: As of December 31, 2019 2018 (in thousands) Accrued compensation and benefits $ 6,161 $ 7,438 Due to affiliates (Note 13) 7,212 7,635 Revenue share payable (Note 12) 2,316 2,976 Accrued interest 1,294 1,294 Professional fees 1,481 2,594 Deferred rent — 2,035 Deferred tax liabilities (Note 14) — 60 Due to DB Med Investors, at fair value 1,750 — Accounts payable and other accrued expenses 1,672 2,412 Total accounts payable, accrued expenses and other liabilities $ 21,886 $ 26,444 On June 3, 2016, the Company entered into a Master Investment Agreement with DB MED Investor I LLC and DB MED Investor II LLC ("DB Med Investors’’) to invest in new and existing Medley managed funds (the "Joint Venture"). Under the Master Investment Agreement, as amended (the "MIA"), DB Med Investors have the right upon the occurrence of certain events (the "Put Option Trigger Event") to redeem their interests in the Joint Venture. In October 2019, a Put Option Trigger Event had occurred. On October 22, 2019, Medley LLC, Medley Seed Funding I LLC (“Seed Funding I”) and Medley Seed Funding II LLC (“Seed Funding II”) received notice from DB Med Investors that they exercised their put option right under the MIA. In connection with the exercise of DB Med Investors put option right, the Company reclassified the Joint Venture's minority interest balance from redeemable non-controlling interests in the mezzanine section of its consolidated balance sheet (Note 16) to due to DB Med Investors, at fair value, a component of accounts payable, accrued expenses and other liabilities, at its then fair value of $18.1 million . In addition, the Company elected to subsequently remeasure the liability under ASC 825, Financial Instruments, with changes recorded through earnings. Management elected the fair value option to measure this liability as the liability will ultimately be settled by delivering assets of the Medley Seed Funding entities which are measured at their fair value on the company's consolidated balance sheets. The net change in fair value during the year ended December 31, 2019 was $0.2 million and is included as a component of other (expenses) income, net on the Company's consolidated statement of operations. In accordance with its obligations under the MIA, on October 25, 2019 and October 28, 2019, Seed Funding I distributed to DB Med Investors all of its assets, including the 7,756,938 shares of MCC, which had an aggregate fair value on the date of transfer of $16.5 million , and cash of less than $0.1 million . Seed Funding II expects to distribute to DB Med Investors all of its assets, including cash of less than $0.1 million and approximately 82,121 shares held by Seed Investor II in Sierra Total Return Fund by March 31, 2020. |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions [Abstract] | |
Schedule of Total Revenues and Amounts Due from Related Parties | Total revenues recorded under these agreements for the years ended December 31, 2019, 2018 and 2017 are reflected in the table below. For the Years Ended December 31, 2019 2018 2017 (in thousands) MCC Admin Agreement $ 2,830 $ 3,382 $ 3,799 SIC Admin Agreement 2,516 2,538 3,031 Fund Admin Agreements 979 976 1,264 Total administrative fees from related parties $ 6,325 $ 6,896 $ 8,094 Amounts due from related parties under these agreements are reflected in the table below. As of December 31, 2019 2018 (in thousands) Amounts due from MCC under the MCC Admin Agreement $ 444 $ 804 Amounts due from SIC under the SIC Admin Agreement 382 619 Amounts due from entities under the Fund Admin Agreements 247 222 Total administrative fees receivable $ 1,073 $ 1,645 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Provision for Income Taxes | The provision for (benefit from) income taxes consist of the following For the Years Ending December 31, 2019 2018 2017 Current tax provision $ 35 $ 862 $ 681 Deferred tax provision 3,524 (1,162 ) (85 ) Provision for (benefit from) income taxes $ 3,559 $ (300 ) $ 596 |
Summary of Deferred Tax Assets and Liabilities | The significant components of the Company's deferred tax assets and liabilities included on its consolidated balance sheet are as follows: As of December 31, 2019 2018 Deferred tax assets (in thousands) Tax goodwill $ 1,488 $ 565 New York City unincorporated business tax 1,177 1,234 Unrealized losses 145 581 Stock-based compensation 197 216 Interest expense carryforward 453 223 Pending merger related costs 188 101 Other items 148 224 Gross deferred tax assets $ 3,796 $ 3,144 Deferred tax liability Accrued fee income $ 33 247 $ — Other items 78 60 Gros deferred tax liabilities 111 60 Less deferred tax valuation allowance $ (3,685 ) — Net deferred tax asset $ — $ 3,084 |
Reconciliation of Statutory to Effective Tax Rates | During the year ended December 31, 2019, the Company recorded a deferred tax asset of $0.4 million in connection with its acquisition of a minority interest holder's ownership interests in a consolidated subsidiary which occurred on December 31, 2018. The establishment of this deferred tax asset was recorded through an adjustment of $0.4 million to members deficit. After evaluating the quantitative and qualitative aspects of the adjustment, the Company concluded that its 2018 financial statements were not materially misstated and adjusted for the amount during the fourth quarter of 2019. Due to the uncertain nature of the ultimate realization of its net deferred tax assets, the Company has established a full valuation allowance, as of December 31, 2019, against the benefits of its deferred tax assets and will recognize these benefits only as reassessment demonstrates they are realizable. Ultimate realization is dependent upon several factors, among which is future earnings and reversing temporary differences. While the need for this valuation allowance is subject to periodic review, if the allowance is reduced, the tax benefits of the net deferred tax assets will be recorded in future operations as a reduction of the Company’s income tax expense. A reconciliation of the federal statutory tax rate to the effective tax rates for the years ended December 31, 2019, 2018 and 2017 are as follows: For the For the Year Ending December 31, 2019 2018 2017 Federal statutory rate 21.0 % 21.0 % 34.0 % Rate benefit from U.S. partnership operations (21.0 )% (21.0 )% (34.0 )% Partnership unincorporated business tax 1.0 % 1.4 % 3.1 % Valuation allowance (30.5 )% — % — % Effective tax rate (29.5 )% 1.4 % 3.1 % |
REDEEMABLE NON-CONTROLLING IN_2
REDEEMABLE NON-CONTROLLING INTERESTS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Temporary Equity Disclosure [Abstract] | |
Schedule of Redeemable Noncontrolling Interests | Changes in redeemable non-controlling interests during the years ended December 31, 2019, 2018 and 2017 are reflected in the table below. For the Years Ended December 31, 2019 2018 2017 (in thousands) Beginning balance $ 23,186 $ 53,741 30,805 Net loss attributable to redeemable non-controlling interests in consolidated subsidiaries (4,275 ) (11,362 ) 6,702 Contributions — — 23,000 Distributions (2,362 ) (5,953 ) (6,738 ) Change in fair value of available-for-sale securities — — (28 ) Fair value adjustment to redeemable non-controlling interests 812 (965 ) — Reclassification of redeemable non-controlling interest in SIC Advisors LLC, including fair value adjustment of $965, to accounts payable, accrued expenses and other liabilities — (12,275 ) — Reclassification of redeemable non-controlling interest in the Joint Venture, including fair value adjustment of $812, to accounts payable, accrued expenses and other liabilities (18,109 ) — — Ending balance $ (748 ) $ 23,186 $ 53,741 |
QUARTERLY FINANCIAL DATA (una_2
QUARTERLY FINANCIAL DATA (unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Information | The Company's condensed consolidated unaudited quarterly results of operations for 2019 and 2018 are as follows: For the Three Months Ended December 31, 2019 September 30, 2019 June 30, March 31, 2019 (Amounts in thousands) Revenues $ 10,654 $ 11,536 $ 12,882 $ 13,769 Expenses 11,279 12,493 11,064 11,275 Other (expenses) income, net (6,445 ) (924 ) (8,666 ) 1,245 (Loss) income before income taxes (7,070 ) (1,881 ) (6,848 ) 3,739 Net (loss) income (10,699 ) (1,853 ) (6,815 ) 3,748 Net (loss) income attributable to redeemable non-controlling interests and non-controlling interests in consolidated subsidiaries (3,836 ) 1,619 (5,674 ) 4,195 Net (loss) income attributable to Medley LLC $ (6,863 ) $ (3,472 ) $ (1,141 ) $ (447 ) For the Three Months Ended December 31, 2018 September 30, 2018 June 30, March 31, 2018 (Amounts in thousands) Revenues $ 12,565 $ 14,397 $ 15,151 $ 14,396 Expenses 14,058 12,485 11,649 12,840 Other (expenses) income, net (10,928 ) 956 (5,766 ) (11,007 ) (Loss) income before income taxes (12,421 ) 2,868 (2,264 ) (9,451 ) Net (loss) income (12,031 ) 2,676 (2,292 ) (9,321 ) Net (loss) income attributable to redeemable non-controlling interests and non-controlling interests in consolidated subsidiaries (7,971 ) 3,866 (2,464 ) (4,514 ) Net (loss) income attributable to Medley LLC $ (4,061 ) $ (1,190 ) $ 172 $ (4,807 ) |
ORGANIZATION AND BASIS OF PRE_2
ORGANIZATION AND BASIS OF PRESENTATION (Initial Public Offering Narrative) (Details) | 12 Months Ended |
Dec. 31, 2019segment | |
Subsidiary, Sale of Stock [Line Items] | |
Number of reportable segments | 1 |
ORGANIZATION AND BASIS OF PRE_3
ORGANIZATION AND BASIS OF PRESENTATION (Medley LLC Reorganization Narrative) (Details) | Sep. 29, 2014shares | Dec. 31, 2019 |
Class of Stock [Line Items] | ||
Transfer of units to common stock, prior to fourth anniversary | 33.33% | |
Transfer of units to common stock, prior to fifth anniversary | 66.66% | |
Common Class A [Member] | ||
Class of Stock [Line Items] | ||
Common stock exchange ratio | 1 | |
Medley LLC [Member] | ||
Class of Stock [Line Items] | ||
Conversion of pre-IPO interests to LLC Units (in shares) | 23,333,333 |
ORGANIZATION AND BASIS OF PRE_4
ORGANIZATION AND BASIS OF PRESENTATION (Agreement and Plan of Merger Narrative) (Details) | Dec. 23, 2019USD ($)shares | Dec. 20, 2019USD ($) | Jul. 29, 2019USD ($)$ / shares | Aug. 09, 2018$ / shares | Dec. 31, 2018USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Jun. 30, 2019$ / shares |
Business Acquisition [Line Items] | |||||||||
Transaction expenses | $ 2,100,000 | $ 4,600,000 | $ 3,800,000 | $ 0 | |||||
Sierra [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Cash consideration (in dollars per share) | $ / shares | $ 2.96 | $ 3.44 | $ 6.37 | ||||||
Cash | $ 17,000,000 | ||||||||
Stock | $ 30,000,000 | ||||||||
MCC [Member] | Sierra [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Exchange ratio | 0.26 | 0.66 | 0.8050 | ||||||
Cash | $ 17,000,000 | ||||||||
Number of Shares | shares | 4,709,576.14 | ||||||||
Settlement amount | $ 420,334.97 | ||||||||
Agreement To Appoint Director, Amount | $ 100,000 | ||||||||
Establishment Of Settlement Fund, Period | 5 days | ||||||||
Additional Fee Estimate Payment, Percentage | 20.00% | ||||||||
Escrow Fee, Percentage | 20.00% | ||||||||
Closing Of NAV Disclosure, Period | 5 days | ||||||||
MCC [Member] | Sierra [Member] | Lead Plaintiffs’ Counsel [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Settlement amount | $ 3,000,000 | ||||||||
MCC [Member] | Sierra [Member] | Counsel To Plaintiff [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Settlement amount | $ 75,000 | ||||||||
Medley LLC [Member] | Sierra [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Exchange ratio | 0.2072 | ||||||||
Common Class A [Member] | Sierra [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Exchange ratio | 0.2668 | 0.3836 | |||||||
Common Class A [Member] | Medley LLC [Member] | Sierra [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Cash consideration (in dollars per share) | $ / shares | $ 2.66 | ||||||||
Merger Agreement Term One [Member] | MCC [Member] | Sierra [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Exchange ratio | 0.68 | ||||||||
Legal fees | $ 10,000,000 | ||||||||
Merger Agreement Term Two [Member] | MCC [Member] | Sierra [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Exchange ratio | 0.66 | ||||||||
Legal fees | $ 15,000,000 | ||||||||
Merger Agreement Term Three [Member] | MCC [Member] | Sierra [Member] | Minimum [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Exchange ratio | 0.68 | ||||||||
Legal fees | $ 10,000,000 | ||||||||
Merger Agreement Term Three [Member] | MCC [Member] | Sierra [Member] | Maximum [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Exchange ratio | 0.66 | ||||||||
Legal fees | $ 15,000,000 | ||||||||
Merger Agreement Term Four [Member] | MCC [Member] | Sierra [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Exchange ratio | 0.66 |
ORGANIZATION AND BASIS OF PRE_5
ORGANIZATION AND BASIS OF PRESENTATION (Registered Public Offering of Medley LLC Notes) (Details) - Senior Notes [Member] - USD ($) | Feb. 22, 2017 | Jan. 18, 2017 | Oct. 18, 2016 | Aug. 09, 2016 | Dec. 31, 2019 |
Senior Notes Due 2026 [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, face amount | $ 28,600,000 | $ 25,000,000 | $ 53,600,000 | ||
Debt Instrument Discounted Offering Price | $ 24.45 | ||||
Debt Instrument Offering Price | $ 25 | ||||
Stated interest rate | 6.875% | 6.875% | |||
Redemption percentage | 100.00% | ||||
Senior Notes Due 2026 [Member] | On or After August 15, 2019 [Member] | |||||
Debt Instrument [Line Items] | |||||
Redemption percentage | 100.00% | 100.00% | |||
Senior Notes Due 2024 [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, face amount | $ 34,500,000 | $ 34,500,000 | $ 69,000,000 | ||
Debt Instrument Discounted Offering Price | $ 25.25 | ||||
Debt Instrument Offering Price | $ 25 | ||||
Stated interest rate | 7.25% | 7.25% | |||
Redemption percentage | 100.00% | ||||
Senior Notes Due 2024 [Member] | On or After January 30, 2020 [Member] | |||||
Debt Instrument [Line Items] | |||||
Redemption percentage | 100.00% | 100.00% |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Consolidated and Non-Consolidated Variable Interest Entities Narrative) (Details) | Dec. 31, 2019USD ($)subsidiary | Dec. 31, 2018USD ($) |
Variable Interest Entity [Line Items] | ||
Total assets of consolidated variable interest entity | $ 1,200,000 | $ 22,600,000 |
Total liabilities of consolidated variable interest entity, less than | 100,000 | 100,000 |
Fair value of investments in non-consolidated VIEs | 3,000,000 | 4,200,000 |
Receivables included as a component of other assets and clawback obligation | 1,300,000 | 1,800,000 |
Accrued clawback obligations | 7,200,000 | $ 7,200,000 |
Maximum loss exposure | $ 4,400,000 | |
Medley LLC [Member] | ||
Variable Interest Entity [Line Items] | ||
Number of majority owned subsidiaries | subsidiary | 7 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Seed Investments) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Assets | ||
Cash and cash equivalents | $ 10,377 | $ 16,970 |
Investments, at fair value | 13,287 | 36,425 |
Other assets | 9,727 | 14,145 |
Total Assets | 48,059 | 77,814 |
Liabilities and Equity | ||
Accounts payable, accrued expenses and other liabilities | 21,886 | 26,444 |
Equity | (117,482) | (109,981) |
Total Liabilities, Redeemable Non-controlling Interests and Equity | 48,059 | 77,814 |
STRF [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Amount funded | 2,100 | |
Assets | ||
Cash and cash equivalents | 682 | 274 |
Investments, at fair value | 1,441 | 1,952 |
Other assets | 29 | 248 |
Total Assets | 2,152 | 2,474 |
Liabilities and Equity | ||
Accounts payable, accrued expenses and other liabilities | 342 | 330 |
Equity | 1,810 | 2,144 |
Total Liabilities, Redeemable Non-controlling Interests and Equity | 2,152 | 2,474 |
Other assets eliminated | 200 | 200 |
Accrued expense and other liabilities eliminated (less than) | 100 | |
Equity eliminated | $ 1,800 | $ 2,100 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details) - USD ($) $ in Thousands | Jan. 01, 2018 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 01, 2019 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||
Benefit from income taxes | $ (3,559) | $ 300 | $ (596) | ||||||||||
Revenues | $ 10,654 | $ 11,536 | $ 12,882 | $ 13,769 | $ 12,565 | $ 14,397 | $ 15,151 | $ 14,396 | 49,176 | 57,588 | |||
Carried interest distribution | 300 | ||||||||||||
Accrued clawback obligations | 7,200 | $ 7,200 | 7,200 | $ 7,200 | |||||||||
Reversal of previously recognized carried interest, less than | 100 | ||||||||||||
Right-of-use assets under operating leases | 6,564 | 6,564 | $ 8,200 | ||||||||||
Operating lease liabilities | 8,267 | 8,267 | 10,200 | ||||||||||
ASC 606 [Member] | |||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||
Decrease in equity | $ 3,600 | ||||||||||||
Benefit from income taxes | 100 | ||||||||||||
Reimbursable fund | 700 | ||||||||||||
ASC 606 [Member] | Performance Fee [Member] | |||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||
Revenues | $ 3,000 | ||||||||||||
ASU 2016-02 [Member] | |||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||
Right-of-use assets under operating leases | 8,233 | 8,233 | 8,200 | ||||||||||
Operating lease liabilities | $ 10,229 | $ 10,229 | $ 10,200 | ||||||||||
Minimum [Member] | Furniture, Fixtures, And Computer Equipment [Member] | |||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||
Useful Life | 3 years | ||||||||||||
Minimum [Member] | Leasehold Improvements [Member] | |||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||
Useful Life | 3 years | ||||||||||||
Maximum [Member] | Furniture, Fixtures, And Computer Equipment [Member] | |||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||
Useful Life | 7 years | ||||||||||||
Maximum [Member] | Leasehold Improvements [Member] | |||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||
Useful Life | 8 years |
REVENUES FROM CONTRACTS WITH _3
REVENUES FROM CONTRACTS WITH CUSTOMERS (Summary of Revenue from Contracts with Customers Disaggregated by Type of Customer) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | $ 10,654 | $ 11,536 | $ 12,882 | $ 13,769 | $ 12,565 | $ 14,397 | $ 15,151 | $ 14,396 | $ 49,176 | $ 57,588 | |
Management Fees [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 39,473 | 47,085 | $ 58,104 | ||||||||
Other Revenues and Fees [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 9,703 | 10,503 | $ 9,201 | ||||||||
Permanent Capital Vehicles [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 33,533 | 39,366 | |||||||||
Permanent Capital Vehicles [Member] | Management Fees [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 27,208 | 32,471 | |||||||||
Permanent Capital Vehicles [Member] | Other Revenues and Fees [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 6,325 | 6,895 | |||||||||
Long-dated Private Funds [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 6,641 | 8,122 | |||||||||
Long-dated Private Funds [Member] | Management Fees [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 6,641 | 8,122 | |||||||||
Long-dated Private Funds [Member] | Other Revenues and Fees [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 0 | 0 | |||||||||
SMAs [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 5,624 | 6,492 | |||||||||
SMAs [Member] | Management Fees [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 5,624 | 6,492 | |||||||||
SMAs [Member] | Other Revenues and Fees [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 0 | 0 | |||||||||
Other [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 3,378 | 3,608 | |||||||||
Other [Member] | Management Fees [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 0 | 0 | |||||||||
Other [Member] | Other Revenues and Fees [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | $ 3,378 | $ 3,608 |
REVENUES FROM CONTRACTS WITH _4
REVENUES FROM CONTRACTS WITH CUSTOMERS (Narrative) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |||
Contract liabilities | $ 200,000 | $ 300,000 | $ 300,000 |
Deferred revenue | 700,000 | 700,000 | |
Cash deposits | 500,000 | 800,000 | |
Contract assets | $ 0 | $ 0 | $ 0 |
INVESTMENTS (Composition of Inv
INVESTMENTS (Composition of Investments) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Schedule of Equity Method Investments [Line Items] | ||
Equity method investments, at fair value | $ 11,650 | $ 13,422 |
Investment held at cost less impairment | 196 | 418 |
Investments of consolidated fund | 1,441 | 1,952 |
Total investments, at fair value | 13,287 | 36,425 |
MCC [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Investment in shares of MCC, at fair value | $ 0 | $ 20,633 |
INVESTMENTS (Narrative) (Detail
INVESTMENTS (Narrative) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Schedule of Investments [Line Items] | ||||
Loss from other than temporary impairment equity investments | $ 0 | $ 0 | $ 0 | |
Equity method investment | $ 11,650,000 | 11,650,000 | 13,422,000 | |
Performance fees | 900,000 | 400,000 | ||
Consolidated Subsidiaries [Member] | Reported Value Measurement [Member] | ||||
Schedule of Investments [Line Items] | ||||
Equity method investment | 200,000 | 200,000 | 400,000 | |
Consolidated Subsidiaries [Member] | Senior Notes [Member] | Reported Value Measurement [Member] | ||||
Schedule of Investments [Line Items] | ||||
Investments of consolidated fund | 1,300,000 | 1,300,000 | 1,600,000 | |
Sierra Income Corporation [Member] | ||||
Schedule of Investments [Line Items] | ||||
Equity method investment | 6,400,000 | 6,400,000 | $ 7,400,000 | |
MCC [Member] | ||||
Schedule of Investments [Line Items] | ||||
Shares in MCC (in shares) | 7,756,938 | |||
Cumulative unrealized gains (losses) | (4,100,000) | $ (19,900,000) | ||
Available-for-sale Securities, Gross Unrealized Loss | $ 11,100,000 | |||
CK Pearl Fund [Member] | ||||
Schedule of Investments [Line Items] | ||||
Investment held at cost less impairment | 200,000 | $ 200,000 | 400,000 | |
Investment held at cost impairment | $ 0 | $ 0 |
INVESTMENTS (Significant Equity
INVESTMENTS (Significant Equity Method Investments) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Schedule of Investments [Abstract] | |||
Investments, at fair value | $ 1,020,709 | $ 1,417,176 | |
Cash | 255,738 | 97,889 | |
Other assets | 37,139 | 57,677 | |
Total assets | 1,313,586 | 1,572,742 | |
Debt | 338,988 | 367,424 | |
Other liabilities | 13,775 | 20,686 | |
Total liabilities | 352,763 | 388,110 | |
Net assets | 960,823 | 1,184,632 | |
Summary of Operations | |||
Total revenues | 110,877 | 142,431 | $ 162,386 |
Total expenses | 59,684 | 64,339 | 64,517 |
Net realized and unrealized gain/(loss) on investments | (104,228) | (131,554) | (89,508) |
Net income (loss) | $ (53,035) | $ (53,462) | $ 8,361 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments of consolidated fund | $ 13,287 | $ 36,425 |
Equity investments | 11,650 | 13,422 |
Level III [Member] | Consolidated Subsidiaries [Member] | Investments [Member] | ||
Level III Financial Assets as of December 31, 2019 | ||
Beginning balance | 1,694 | |
Purchases | 539 | |
Transfers In or (Out) of Level III | 0 | |
Realized and Unrealized Depreciation | (125) | |
Sale of Level III Assets | (777) | |
Ending balance | 1,331 | |
Reported Value Measurement [Member] | Consolidated Subsidiaries [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity investments | 200 | 400 |
Reported Value Measurement [Member] | Senior Notes [Member] | Consolidated Subsidiaries [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Assets | 1,300 | 1,600 |
Reported Value Measurement [Member] | Level I [Member] | Consolidated Subsidiaries [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity investments | 100 | 300 |
Reported Value Measurement [Member] | Level III [Member] | Senior Notes [Member] | Consolidated Subsidiaries [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Assets | 1,300 | 1,700 |
Nonrecurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment in shares of MCC | 20,633 | |
Total Assets | 1,441 | 22,585 |
Level III Financial Assets as of December 31, 2019 | ||
Due To Related Party, Fair Value Disclosure | 1,750 | |
Financial Liabilities Fair Value Disclosure | 1,750 | |
Nonrecurring [Member] | Consolidated Subsidiaries [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments of consolidated fund | 1,441 | 1,952 |
Nonrecurring [Member] | Reported Value Measurement [Member] | Level I [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment in shares of MCC | 20,633 | |
Total Assets | 110 | 20,891 |
Level III Financial Assets as of December 31, 2019 | ||
Due To Related Party, Fair Value Disclosure | 0 | |
Financial Liabilities Fair Value Disclosure | 0 | |
Nonrecurring [Member] | Reported Value Measurement [Member] | Level I [Member] | Consolidated Subsidiaries [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments of consolidated fund | 110 | 258 |
Nonrecurring [Member] | Reported Value Measurement [Member] | Level II [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment in shares of MCC | 0 | |
Total Assets | 0 | 0 |
Level III Financial Assets as of December 31, 2019 | ||
Due To Related Party, Fair Value Disclosure | 0 | |
Financial Liabilities Fair Value Disclosure | 0 | |
Nonrecurring [Member] | Reported Value Measurement [Member] | Level II [Member] | Consolidated Subsidiaries [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments of consolidated fund | 0 | 0 |
Nonrecurring [Member] | Reported Value Measurement [Member] | Level III [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment in shares of MCC | 0 | |
Total Assets | 1,331 | 1,694 |
Level III Financial Assets as of December 31, 2019 | ||
Due To Related Party, Fair Value Disclosure | 1,750 | |
Financial Liabilities Fair Value Disclosure | 1,750 | |
Nonrecurring [Member] | Reported Value Measurement [Member] | Level III [Member] | Consolidated Subsidiaries [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments of consolidated fund | 1,331 | 1,694 |
Obligations [Member] | Level III [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability Value | 1,750 | $ 0 |
Level III Financial Assets as of December 31, 2019 | ||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability, Settlements | (16,537) | |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability, Unrealized Appreciation, Depreciation | 178 | |
Obligations [Member] | Level III [Member] | Consolidated Subsidiaries [Member] | Investments [Member] | ||
Level III Financial Assets as of December 31, 2019 | ||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Liability, Reclassifications Of Temporary To Permanent Equity | $ 18,109 | |
Long-term Debt [Member] | Valuation, Income Approach [Member] | Senior Secured First Lien Term Loan [Member] | Minimum [Member] | Measurement Input, Market Yield [Member] | Level III [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt Instrument, Measurement Input | 0.0532 | |
Long-term Debt [Member] | Valuation, Income Approach [Member] | Senior Secured First Lien Term Loan [Member] | Maximum [Member] | Measurement Input, Market Yield [Member] | Level III [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt Instrument, Measurement Input | 0.2359 | |
Long-term Debt [Member] | Valuation, Income Approach [Member] | Senior Secured First Lien Term Loan [Member] | Weighted Average [Member] | Measurement Input, Market Yield [Member] | Level III [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt Instrument, Measurement Input | 0.0938 | |
Long-term Debt [Member] | Valuation, Income Approach [Member] | Senior Secured Second Lien Term Loan [Member] | Minimum [Member] | Measurement Input, Market Yield [Member] | Level III [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt Instrument, Measurement Input | 0.0912 | |
Long-term Debt [Member] | Valuation, Income Approach [Member] | Senior Secured Second Lien Term Loan [Member] | Maximum [Member] | Measurement Input, Market Yield [Member] | Level III [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt Instrument, Measurement Input | 0.2976 | |
Long-term Debt [Member] | Valuation, Income Approach [Member] | Senior Secured Second Lien Term Loan [Member] | Weighted Average [Member] | Measurement Input, Market Yield [Member] | Level III [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt Instrument, Measurement Input | 0.1205 | |
Preferred Stock [Member] | Valuation, Market Approach [Member] | Minimum [Member] | Measurement Input, EBITDA Multiple [Member] | Level III [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity Securities, FV-NI, Measurement Input | 8 | |
Preferred Stock [Member] | Valuation, Market Approach [Member] | Maximum [Member] | Measurement Input, EBITDA Multiple [Member] | Level III [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity Securities, FV-NI, Measurement Input | 9 | |
Preferred Stock [Member] | Valuation, Market Approach [Member] | Weighted Average [Member] | Measurement Input, EBITDA Multiple [Member] | Level III [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity Securities, FV-NI, Measurement Input | 8.50 | |
Preferred Stock [Member] | Valuation Technique, Discounted Cash Flow [Member] | Minimum [Member] | Measurement Input, Discount Rate [Member] | Level III [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity Securities, FV-NI, Measurement Input | 0.1750 | |
Preferred Stock [Member] | Valuation Technique, Discounted Cash Flow [Member] | Maximum [Member] | Measurement Input, Discount Rate [Member] | Level III [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity Securities, FV-NI, Measurement Input | 0.1950 | |
Preferred Stock [Member] | Valuation Technique, Discounted Cash Flow [Member] | Weighted Average [Member] | Measurement Input, Discount Rate [Member] | Level III [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity Securities, FV-NI, Measurement Input | 0.1850 | |
Common Stock [Member] | Valuation, Market Approach [Member] | Minimum [Member] | Measurement Input, EBITDA Multiple [Member] | Level III [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity Securities, FV-NI, Measurement Input | 8 | |
Common Stock [Member] | Valuation, Market Approach [Member] | Maximum [Member] | Measurement Input, EBITDA Multiple [Member] | Level III [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity Securities, FV-NI, Measurement Input | 9 | |
Common Stock [Member] | Valuation, Market Approach [Member] | Weighted Average [Member] | Measurement Input, EBITDA Multiple [Member] | Level III [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity Securities, FV-NI, Measurement Input | 8.50 | |
Common Stock [Member] | Valuation Technique, Discounted Cash Flow [Member] | Minimum [Member] | Measurement Input, Discount Rate [Member] | Level III [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity Securities, FV-NI, Measurement Input | 0.1750 | |
Common Stock [Member] | Valuation Technique, Discounted Cash Flow [Member] | Maximum [Member] | Measurement Input, Discount Rate [Member] | Level III [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity Securities, FV-NI, Measurement Input | 0.1950 | |
Common Stock [Member] | Valuation Technique, Discounted Cash Flow [Member] | Weighted Average [Member] | Measurement Input, Discount Rate [Member] | Level III [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity Securities, FV-NI, Measurement Input | 0.1850 |
LEASES (Narrative) (Details)
LEASES (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2019 | Jan. 01, 2019 | |
Leases [Abstract] | ||||
Right-of-use assets under operating leases | $ 6,564 | $ 8,200 | ||
Operating lease liabilities | $ 8,267 | $ 10,200 | ||
Rent expense | $ 2,300 | $ 2,400 |
LEASES (Summary of Components o
LEASES (Summary of Components of Lease Cost and Other Information) (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Leases [Abstract] | |
Operating lease costs | $ 2,554 |
Variable lease costs | 0 |
Sublease income | (454) |
Total lease cost | $ 2,100 |
LEASES (Summary of Supplemental
LEASES (Summary of Supplemental Balance Sheet Information Related to Leases) (Details) | Dec. 31, 2019 |
Leases [Abstract] | |
Weighted-average remaining lease term (in years) | 3 years 6 months |
Weighted-average discount rate | 8.20% |
LEASES (Summary of Future Payme
LEASES (Summary of Future Payments for Operating Leases) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Jan. 01, 2019 |
Leases [Abstract] | ||
2020 | $ 2,846 | |
2021 | 2,483 | |
2022 | 2,441 | |
2023 | 1,822 | |
Total future lease payments | 9,592 | |
Less imputed interest | (1,325) | |
Operating lease liabilities, as reported | $ 8,267 | $ 10,200 |
OTHER ASSETS (Details)
OTHER ASSETS (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Fixed assets, net of accumulated depreciation and amortization of $3,847 and $3,446, respectively | $ 2,564 | $ 3,140 |
Security deposits | 1,975 | 1,975 |
Administrative fees receivable (Note 13) | 1,073 | 1,645 |
Deferred tax assets (Note 14) | 0 | 3,144 |
Due from affiliates (Note 13) | 2,693 | 2,215 |
Prepaid expenses and income taxes | 746 | 761 |
Other assets | 676 | 1,265 |
Total other assets | 9,727 | 14,145 |
Accumulated depreciation | $ 3,847 | $ 3,446 |
SENIOR UNSECURED DEBT (Schedule
SENIOR UNSECURED DEBT (Schedule of Senior Unsecured Debt) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Feb. 22, 2017 | Oct. 18, 2016 |
Debt Instrument [Line Items] | ||||
Senior unsecured debt | $ 118,382 | $ 117,618 | ||
Senior Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Senior unsecured debt | 118,382 | 117,618 | ||
Senior Notes [Member] | Senior Notes Due 2026 [Member] | ||||
Debt Instrument [Line Items] | ||||
Senior unsecured debt | 51,011 | 50,649 | ||
Debt instrument, unamortized discount (premium) and debt issuance costs | 2,584 | 2,946 | $ 3,800 | |
Senior Notes [Member] | Senior Notes Due 2024 [Member] | ||||
Debt Instrument [Line Items] | ||||
Senior unsecured debt | 67,371 | 66,969 | ||
Debt instrument, unamortized discount (premium) and debt issuance costs | $ 1,629 | $ 2,031 | $ (2,800) |
SENIOR UNSECURED DEBT (Narrativ
SENIOR UNSECURED DEBT (Narrative) (Details) - Senior Notes [Member] - USD ($) | Feb. 22, 2017 | Jan. 18, 2017 | Oct. 18, 2016 | Aug. 09, 2016 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Senior Notes Due 2026 [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, face amount | $ 28,600,000 | $ 25,000,000 | $ 53,600,000 | ||||
Stated interest rate | 6.875% | 6.875% | |||||
Redemption percentage | 100.00% | ||||||
Discount (premium) and direct issuance costs | $ 3,800,000 | 2,584,000 | $ 2,946,000 | ||||
Notes payable, fair value disclosure | 36,000,000 | ||||||
Interest expense, including amortization of discount and debt issuance costs | $ 4,000,000 | 4,000,000 | $ 4,000,000 | ||||
Senior Notes Due 2026 [Member] | On or After August 15, 2019 [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Redemption percentage | 100.00% | 100.00% | |||||
Senior Notes Due 2024 [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, face amount | $ 34,500,000 | $ 34,500,000 | $ 69,000,000 | ||||
Stated interest rate | 7.25% | 7.25% | |||||
Redemption percentage | 100.00% | ||||||
Discount (premium) and direct issuance costs | $ (2,800,000) | 1,629,000 | 2,031,000 | ||||
Notes payable, fair value disclosure | 48,400,000 | ||||||
Interest expense, including amortization of discount and debt issuance costs | $ 5,400,000 | $ 4,900,000 | $ 4,900,000 | ||||
Senior Notes Due 2024 [Member] | On or After January 30, 2020 [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Redemption percentage | 100.00% | 100.00% |
LOANS PAYABLE (Schedule of Loan
LOANS PAYABLE (Schedule of Loans Payable) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Debt Instrument [Line Items] | ||
Loans payable | $ 10,000 | $ 9,892 |
Nonrecourse Promissory Notes [Member] | ||
Debt Instrument [Line Items] | ||
Loans payable | $ 10,000 | 9,892 |
Unamortized discount | $ 108 |
LOANS PAYABLE (Narrative) (Deta
LOANS PAYABLE (Narrative) (Details) - USD ($) | Jan. 31, 2019 | Aug. 19, 2014 | Apr. 30, 2012 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Aug. 14, 2014 |
Debt Instrument [Line Items] | |||||||
Payment of debt | $ 6,500,000 | ||||||
Future principal payments due in 2019 | 10,000,000 | ||||||
Amortization of debt issuance costs, less than | 754,000 | $ 741,000 | $ 1,579,000 | ||||
Nonrecourse Promissory Notes [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, face amount | $ 10,000,000 | ||||||
Number of shares of common stock purchased (in shares) | 1,108,033 | ||||||
Unamortized debt issuance expense | $ 3,800,000 | ||||||
Interest expense | $ 900,000 | 1,400,000 | |||||
Debt instrument interest rate increase | 1.00% | ||||||
Notes payable, fair value disclosure | $ 10,000,000 | $ 10,000,000 | |||||
New Promissory Note [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, face amount | $ 6,500,000 | ||||||
Repayments of debt | $ 6,500,000 | ||||||
Debt maturity term | 6 months | ||||||
New Promissory Note [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Spread on interest rate | 7.00% | ||||||
Credit Suisse Term Loan Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, face amount | $ 110,000,000 | ||||||
Interest expense | $ 1,500,000 | ||||||
Revolving Credit Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, face amount | $ 15,000,000 | ||||||
Amortization of debt issuance costs, less than | $ 100,000 | ||||||
Revolving Credit Facility [Member] | Alternate Base Rate [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Spread on interest rate | 0.25% | ||||||
Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Spread on interest rate | 2.50% |
DUE TO FORMER MINORITY INTERE_3
DUE TO FORMER MINORITY INTEREST HOLDER (Details) | 12 Months Ended | ||
Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($)installment | Dec. 31, 2017USD ($) | |
Debt Instrument [Line Items] | |||
Due to former minority interest holder | $ 8,145,000 | $ 11,402,000 | |
Future payments: | |||
Total future payments | 10,000,000 | 9,892,000 | |
Due to Former Minority Interest Holder [Member] | |||
Debt Instrument [Line Items] | |||
Due to former minority interest holder | 8,145,000 | 11,402,000 | |
Unamortized discount | 1,480,000 | 2,598,000 | |
Debt consideration | $ 14,000,000 | ||
Number of installments | installment | 16 | ||
Future payments: | |||
2020 | 3,500,000 | ||
2021 | 3,500,000 | ||
2022 | 2,625,000 | ||
Total future payments | $ 9,625,000 | ||
Debt maturity term | 4 years | ||
Debt discount | $ 2,800,000 | $ 1,100,000 | $ 100,000 |
ACCOUNTS PAYABLE, ACCRUED EXP_3
ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER LIABILITIES (Details) - USD ($) | Mar. 31, 2020 | Oct. 28, 2019 | Jun. 06, 2017 | Jul. 31, 2019 | Dec. 31, 2019 | Oct. 22, 2019 | Dec. 31, 2018 | Jun. 03, 2016 |
Other Commitments [Line Items] | ||||||||
Accrued compensation and benefits | $ 6,161,000 | $ 7,438,000 | ||||||
Due to affiliates (Note 13) | 7,212,000 | 7,635,000 | ||||||
Revenue share payable (Note 12) | 2,316,000 | 2,976,000 | ||||||
Accrued interest | 1,294,000 | 1,294,000 | ||||||
Professional fees | 1,481,000 | 2,594,000 | ||||||
Deferred rent | 0 | 2,035,000 | ||||||
Deferred tax liabilities (Note 14) | 0 | 60,000 | ||||||
Due to DB Med Investors | 1,750,000 | 0 | ||||||
Accounts payable and other accrued expenses | 1,672,000 | 2,412,000 | ||||||
Total accounts payable, accrued expenses and other liabilities | 21,886,000 | 26,444,000 | ||||||
Db Med Investor I And Ii Llc [Member] | ||||||||
Other Commitments [Line Items] | ||||||||
Liabilities, Fair Value Adjustment | 200,000 | |||||||
Fair value of non-controlling interest | $ 18,100,000 | |||||||
Contributions to the joint venture | $ 700,000 | |||||||
STRF [Member] | ||||||||
Other Commitments [Line Items] | ||||||||
Total accounts payable, accrued expenses and other liabilities | $ 342,000 | $ 330,000 | ||||||
Master Investment Agreement with DB MED Investor I LLC and DB MED Investor II LLC [Member] | ||||||||
Other Commitments [Line Items] | ||||||||
Investments and contributions | $ 13,800,000 | $ 10,000,000 | ||||||
Master Investment Agreement with DB MED Investor I LLC and DB MED Investor II LLC [Member] | Db Med Investor I And Ii Llc [Member] | ||||||||
Other Commitments [Line Items] | ||||||||
Investments and contributions | 40,000,000 | |||||||
Master Investment Agreement with DB MED Investor I LLC and DB MED Investor II LLC [Member] | Medley and ''Investors'' [Member] | ||||||||
Other Commitments [Line Items] | ||||||||
Investments and contributions | $ 50,000,000 | |||||||
Contributions to the joint venture | $ 53,800,000 | |||||||
Master Investment Agreement with DB MED Investor I LLC and DB MED Investor II LLC [Member] | MCC Advisors LLC [Member] | Medley and ''Investors'' [Member] | ||||||||
Other Commitments [Line Items] | ||||||||
Other Commitment, Number Of Shares Distributed | 7,756,938 | |||||||
Investments and contributions | $ 16,500,000 | |||||||
Contributions to the joint venture | $ 100,000 | |||||||
Forecast [Member] | Master Investment Agreement with DB MED Investor I LLC and DB MED Investor II LLC [Member] | STRF [Member] | ||||||||
Other Commitments [Line Items] | ||||||||
Other Commitment, Number Of Shares Distributed | 82,121 | |||||||
Forecast [Member] | Master Investment Agreement with DB MED Investor I LLC and DB MED Investor II LLC [Member] | MCC Advisors LLC [Member] | Medley and ''Investors'' [Member] | ||||||||
Other Commitments [Line Items] | ||||||||
Contributions to the joint venture | $ 100,000 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Narrative) (Details) | Dec. 23, 2019USD ($)shares | Dec. 20, 2019USD ($) | Jan. 31, 2019USD ($) | Aug. 09, 2018$ / shares | May 29, 2015USD ($) | Feb. 28, 2015 | Apr. 30, 2012USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2019USD ($) | Jul. 29, 2019$ / shares | Jun. 30, 2019$ / shares |
Loss Contingencies [Line Items] | |||||||||||
Severance costs, less than | $ 2,700,000 | ||||||||||
Loss from sublease | 200,000 | ||||||||||
Possible contingency amount (more than) | $ 6,500,000 | ||||||||||
Sierra [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Cash | $ 17,000,000 | ||||||||||
Stock | $ 30,000,000 | ||||||||||
Cash consideration (in dollars per share) | $ / shares | $ 3.44 | $ 2.96 | $ 6.37 | ||||||||
American Web Loan [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Repayment of loan | 1 year 10 months | ||||||||||
Nonrecourse Promissory Notes [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Proceeds from issuance of debt | $ 10,000,000 | ||||||||||
Present value of future cash flows expected to be paid | 4,400,000 | ||||||||||
Contractual obligation | 3,000,000 | 2,300,000 | |||||||||
Debt instrument, face amount | $ 10,000,000 | ||||||||||
New Promissory Note [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Repayments of debt | $ 6,500,000 | ||||||||||
Debt maturity term | 6 months | ||||||||||
Debt instrument, face amount | $ 6,500,000 | ||||||||||
New Promissory Note [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Spread on interest rate | 7.00% | ||||||||||
Consolidated Funds [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Unfunded capital commitments | $ 300,000 | $ 300,000 | |||||||||
MCC [Member] | Moshe Barkat and MVF Holdings [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Debt default | $ 65,000,000 | ||||||||||
Damages sought | 100,000,000 | ||||||||||
Settlement amount | $ 1,500,000 | ||||||||||
MCC [Member] | Sierra [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Settlement amount | $ 420,334.97 | ||||||||||
Agreement To Appoint Director, Amount | 100,000 | ||||||||||
Cash | $ 17,000,000 | ||||||||||
Number of Shares | shares | 4,709,576.14 | ||||||||||
Exchange ratio | 0.26 | 0.66 | 0.8050 | ||||||||
Establishment Of Settlement Fund, Period | 5 days | ||||||||||
Additional Fee Estimate Payment, Percentage | 20.00% | ||||||||||
Escrow Fee, Percentage | 20.00% | ||||||||||
Closing Of NAV Disclosure, Period | 5 days | ||||||||||
MCC [Member] | Lead Plaintiffs’ Counsel [Member] | Sierra [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Settlement amount | $ 3,000,000 | ||||||||||
MCC [Member] | Counsel To Plaintiff [Member] | Sierra [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Settlement amount | $ 75,000 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Employment Agreements Narrative) (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($)installment | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Initial base salaries | $ | $ 2.5 |
Number of equal installments | installment | 3 |
Minimum [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Term of employee agreements | 24 months |
Maximum [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Term of employee agreements | 30 months |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2019USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Related Party Transaction [Line Items] | ||||||||||||
Administrative fees from related parties | $ 10,654,000 | $ 11,536,000 | $ 12,882,000 | $ 13,769,000 | $ 12,565,000 | $ 14,397,000 | $ 15,151,000 | $ 14,396,000 | $ 49,176,000 | $ 57,588,000 | ||
Administrative fees receivable | 1,073,000 | 1,645,000 | 1,073,000 | 1,645,000 | ||||||||
Reimbursable Expenses | 3,900,000 | 1,900,000 | ||||||||||
Due from Related Parties | 900,000 | 800,000 | $ 900,000 | 800,000 | ||||||||
Management fees waived | 0 | $ 0 | ||||||||||
Common Class A [Member] | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Common stock exchange ratio | 1 | |||||||||||
Affiliated Entity [Member] | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Administrative fees from related parties | $ 8,094,000 | $ 6,325,000 | 6,896,000 | |||||||||
MCC Advisors LLC [Member] | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Management fees waived | $ 400,000 | 0 | ||||||||||
MCC Admin Agreement [Member] | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Administrative fees receivable | 444,000 | 804,000 | 444,000 | 804,000 | ||||||||
MCC Admin Agreement [Member] | Affiliated Entity [Member] | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Administrative fees from related parties | 3,799,000 | 2,830,000 | 3,382,000 | |||||||||
SIC Admin Agreement [Member] | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Administrative fees receivable | 382,000 | 619,000 | 382,000 | 619,000 | ||||||||
SIC Admin Agreement [Member] | Affiliated Entity [Member] | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Administrative fees from related parties | 3,031,000 | 2,516,000 | 2,538,000 | |||||||||
Funds Admin Agreement [Member] | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Administrative fees receivable | $ 247,000 | $ 222,000 | 247,000 | 222,000 | ||||||||
Funds Admin Agreement [Member] | Affiliated Entity [Member] | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Administrative fees from related parties | $ 1,264,000 | $ 979,000 | $ 976,000 |
INCOME TAXES (Provision for Inc
INCOME TAXES (Provision for Income Taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Current tax provision | $ 35 | $ 862 | $ 681 |
Deferred tax provision | 3,524 | (1,162) | (85) |
Provision for Income Taxes | $ 3,559 | $ (300) | $ 596 |
INCOME TAXES (Summary of Deferr
INCOME TAXES (Summary of Deferred Tax Assets and Liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred tax assets | ||
Tax goodwill | $ 1,488 | $ 565 |
Basis difference in partnership interest | 0 | |
Unrealized losses | 145 | 581 |
Stock-based compensation | 197 | 216 |
Interest expense carryforward | 453 | 223 |
Pending merger related costs | 188 | 101 |
New York City unincorporated business tax credit carryforward | 1,177 | 1,234 |
Other items | 148 | 224 |
Total deferred tax assets | 3,796 | 3,144 |
Deferred tax liabilities | ||
Accrued fee income | 33 | 0 |
Other items | 78 | (60) |
Total deferred tax liabilities | 111 | (60) |
Net deferred tax assets | $ 0 | $ 3,084 |
INCOME TAXES (Reconciliation of
INCOME TAXES (Reconciliation of Statutory to Effective Tax Rates) (Details) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Federal statutory rate | 21.00% | 21.00% | 34.00% |
Rate benefit from U.S. partnership operations | (21.00%) | (21.00%) | (34.00%) |
Partnership unincorporated business tax | 1.00% | 1.40% | 3.10% |
Effective tax rate | (29.50%) | 1.40% | 3.10% |
COMPENSATION EXPENSE (Retiremen
COMPENSATION EXPENSE (Retirement Plan Narrative) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percentage vested from participants eligibility date | 100.00% | ||
Contributions as a percent of employee eligible wages | 3.00% | ||
Accrued contributions, less than | $ 400,000 | $ 500,000 | $ 500,000 |
Retirement plan liability | 400,000 | 500,000 | |
Chief Executive Officer [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Maximum aggregate compensation | $ 5,000,000 | $ 5,000,000 | $ 5,000,000 |
COMPENSATION EXPENSE (Stock-Bas
COMPENSATION EXPENSE (Stock-Based Compensation Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation | $ 7,222 | $ 5,404 | $ 2,771 |
REDEEMABLE NON-CONTROLLING IN_3
REDEEMABLE NON-CONTROLLING INTERESTS (Schedule of Redeemable Non-controlling Interest) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Increase (Decrease) in Temporary Equity [Roll Forward] | |||
Beginning balance | $ 23,186 | ||
Fair value adjustment to redeemable non-controlling interests | 812 | $ (965) | |
Ending balance | (748) | 23,186 | |
Redeemable Non-controlling Interests [Member] | |||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||
Beginning balance | 23,186 | 53,741 | $ 30,805 |
Net loss attributable to redeemable non-controlling interests in consolidated subsidiaries | (4,275) | (11,362) | 6,702 |
Contributions | 0 | 0 | 23,000 |
Distributions | (2,362) | (5,953) | (6,738) |
Change in fair value of available-for-sale securities | 0 | 0 | (28) |
Fair value adjustment to redeemable non-controlling interests | 812 | (965) | 0 |
Reclassification of redeemable non-controlling interest in SIC Advisors LLC, including fair value adjustment of $965, to accounts payable, accrued expenses and other liabilities | 0 | (12,275) | 0 |
Ending balance | (748) | 23,186 | 53,741 |
Medley LLC [Member] | Redeemable Non-controlling Interests [Member] | |||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||
Fair value adjustment to redeemable non-controlling interests | (812) | ||
Reclassification of redeemable non-controlling interest in SIC Advisors LLC, including fair value adjustment of $965, to accounts payable, accrued expenses and other liabilities | $ (18,109) | $ 0 | $ 0 |
REDEEMABLE NON-CONTROLLING IN_4
REDEEMABLE NON-CONTROLLING INTERESTS (Narrative) (Details) - USD ($) | Oct. 28, 2019 | Oct. 22, 2019 | Jun. 06, 2017 | Oct. 31, 2019 | Jul. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jul. 31, 2018 | Dec. 31, 2016 | Jun. 03, 2016 | Jan. 31, 2016 |
Redeemable Noncontrolling Interest [Line Items] | ||||||||||||
Fair value adjustment | $ (812,000) | $ 965,000 | ||||||||||
Distributions to members and redeemable non-controlling interests | 4,524,000 | 32,378,000 | $ 36,698,000 | |||||||||
Balance of redeemable non-controlling interest | 748,000 | (23,186,000) | ||||||||||
Master Investment Agreement with DB MED Investor I LLC and DB MED Investor II LLC [Member] | ||||||||||||
Redeemable Noncontrolling Interest [Line Items] | ||||||||||||
Distributions to members and redeemable non-controlling interests | 2,400,000 | 3,700,000 | 2,400,000 | |||||||||
Investments and contributions | $ 13,800,000 | $ 10,000,000 | ||||||||||
Master Investment Agreement with DB MED Investor I LLC and DB MED Investor II LLC [Member] | Minimum [Member] | ||||||||||||
Redeemable Noncontrolling Interest [Line Items] | ||||||||||||
Investment period | 7 years | |||||||||||
Master Investment Agreement with DB MED Investor I LLC and DB MED Investor II LLC [Member] | Maximum [Member] | ||||||||||||
Redeemable Noncontrolling Interest [Line Items] | ||||||||||||
Investment period | 10 years | |||||||||||
Medley and ''Investors'' [Member] | Master Investment Agreement with DB MED Investor I LLC and DB MED Investor II LLC [Member] | ||||||||||||
Redeemable Noncontrolling Interest [Line Items] | ||||||||||||
Investments and contributions | $ 50,000,000 | |||||||||||
Contributions to the joint venture | $ 53,800,000 | |||||||||||
Medley and ''Investors'' [Member] | Master Investment Agreement with DB MED Investor I LLC and DB MED Investor II LLC [Member] | MCC Advisors LLC [Member] | ||||||||||||
Redeemable Noncontrolling Interest [Line Items] | ||||||||||||
Investments and contributions | $ 16,500,000 | |||||||||||
Contributions to the joint venture | $ 100,000 | |||||||||||
Purchases of available for sale securities | $ 51,800,000 | |||||||||||
Db Med Investor I And Ii Llc [Member] | ||||||||||||
Redeemable Noncontrolling Interest [Line Items] | ||||||||||||
Fair value of non-controlling interest | $ 18,100,000 | |||||||||||
Fair value adjustment | 800,000 | |||||||||||
Contributions to the joint venture | $ 700,000 | |||||||||||
Percent of preferred distributions given to Investors | 8.00% | 8.00% | 8.00% | |||||||||
Retained Earnings (Accumulated Deficit) | (200,000) | (200,000) | ||||||||||
Db Med Investor I And Ii Llc [Member] | Master Investment Agreement with DB MED Investor I LLC and DB MED Investor II LLC [Member] | ||||||||||||
Redeemable Noncontrolling Interest [Line Items] | ||||||||||||
Investments and contributions | $ 40,000,000 | |||||||||||
Percent of Joint Venture profits given to Investors | 15.00% | |||||||||||
Period before Investors can redeem their interests | 10 years | |||||||||||
STRF [Member] | ||||||||||||
Redeemable Noncontrolling Interest [Line Items] | ||||||||||||
Net income (losses) allocated to non-controlling interest | (100,000) | (300,000) | (400,000) | |||||||||
Seed investment | 2,100,000 | |||||||||||
Balance of redeemable non-controlling interest | (700,000) | |||||||||||
STRF [Member] | Master Investment Agreement with DB MED Investor I LLC and DB MED Investor II LLC [Member] | ||||||||||||
Redeemable Noncontrolling Interest [Line Items] | ||||||||||||
Seed investment | $ 2,000,000 | |||||||||||
Redeemable Non-controlling Interests [Member] | ||||||||||||
Redeemable Noncontrolling Interest [Line Items] | ||||||||||||
Fair value adjustment | (812,000) | 965,000 | 0 | |||||||||
Balance of redeemable non-controlling interest | 748,000 | (23,186,000) | (53,741,000) | $ (30,805,000) | ||||||||
Redeemable Non-controlling Interests [Member] | SIC Advisors LLC [Member] | ||||||||||||
Redeemable Noncontrolling Interest [Line Items] | ||||||||||||
Fair value of non-controlling interest | $ 12,300,000 | $ 12,200,000 | ||||||||||
Net income (losses) allocated to non-controlling interest | 2,100,000 | 4,400,000 | ||||||||||
Distributions to members and redeemable non-controlling interests | 2,300,000 | 4,300,000 | ||||||||||
Non- controlling Interests in Consolidated Subsidiaries | Master Investment Agreement with DB MED Investor I LLC and DB MED Investor II LLC [Member] | ||||||||||||
Redeemable Noncontrolling Interest [Line Items] | ||||||||||||
Net income (losses) allocated to non-controlling interest | (4,200,000) | (13,100,000) | $ 2,700,000 | |||||||||
Non- controlling Interests in Consolidated Subsidiaries | Db Med Investor I And Ii Llc [Member] | Master Investment Agreement with DB MED Investor I LLC and DB MED Investor II LLC [Member] | ||||||||||||
Redeemable Noncontrolling Interest [Line Items] | ||||||||||||
Balance of redeemable non-controlling interest | $ (23,900,000) | |||||||||||
Accounts Payable, Accrued Expenses and Other Liabilities [Member] | Redeemable Non-controlling Interests [Member] | ||||||||||||
Redeemable Noncontrolling Interest [Line Items] | ||||||||||||
Fair value adjustment | $ 1,000,000 | |||||||||||
Medley LLC [Member] | Db Med Investor I And Ii Llc [Member] | ||||||||||||
Redeemable Noncontrolling Interest [Line Items] | ||||||||||||
Net income (loss) attributable to non-controlling interests | $ 600,000 |
QUARTERLY FINANCIAL DATA (una_3
QUARTERLY FINANCIAL DATA (unaudited) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Effect of Fourth Quarter Events [Line Items] | |||||||||||
Revenues | $ 10,654 | $ 11,536 | $ 12,882 | $ 13,769 | $ 12,565 | $ 14,397 | $ 15,151 | $ 14,396 | $ 49,176 | $ 57,588 | |
Expenses | 11,279 | 12,493 | 11,064 | 11,275 | 14,058 | 12,485 | 11,649 | 12,840 | 46,111 | 51,032 | $ 39,603 |
Other income (expense), net | (6,445) | (924) | (8,666) | 1,245 | (10,928) | 956 | (5,766) | (11,007) | (14,790) | (26,745) | (6,167) |
(Loss) income before income taxes | (7,070) | (1,881) | (6,848) | 3,739 | (12,421) | 2,868 | (2,264) | (9,451) | (12,060) | (21,268) | 19,263 |
Net Income (Loss) | (10,699) | (1,853) | (6,815) | 3,748 | (12,031) | 2,676 | (2,292) | (9,321) | (15,619) | (20,968) | 18,667 |
Net (loss) income attributable to Medley LLC | (6,863) | (3,472) | (1,141) | (447) | (4,061) | (1,190) | 172 | (4,807) | $ (11,923) | $ (9,886) | $ 11,949 |
Consolidated Subsidiaries [Member] | |||||||||||
Effect of Fourth Quarter Events [Line Items] | |||||||||||
Net income attributable to non-controlling interests | $ (3,836) | $ 1,619 | $ (5,674) | $ 4,195 | $ (7,971) | $ 3,866 | $ (2,464) | $ (4,514) |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Mar. 25, 2020 | Oct. 28, 2019 | Jun. 06, 2017 | Dec. 31, 2018 |
MCC [Member] | |||||
Subsequent Event [Line Items] | |||||
Shares held (in shares) | 7,756,938 | ||||
Medley and ''Investors'' [Member] | Master Investment Agreement with DB MED Investor I LLC and DB MED Investor II LLC [Member] | |||||
Subsequent Event [Line Items] | |||||
Contributions to the joint venture | $ 53.8 | ||||
Medley and ''Investors'' [Member] | MCC [Member] | Master Investment Agreement with DB MED Investor I LLC and DB MED Investor II LLC [Member] | |||||
Subsequent Event [Line Items] | |||||
Contributions to the joint venture | $ 0.1 | ||||
Medley and ''Investors'' [Member] | MCC [Member] | Master Investment Agreement with DB MED Investor I LLC and DB MED Investor II LLC [Member] | Forecast [Member] | |||||
Subsequent Event [Line Items] | |||||
Contributions to the joint venture | $ 0.1 | ||||
Medley and ''Investors'' [Member] | MCC [Member] | Master Investment Agreement with DB MED Investor I LLC and DB MED Investor II LLC [Member] | Subsequent Event [Member] | |||||
Subsequent Event [Line Items] | |||||
Contributions to the joint venture | $ 0.1 |
Uncategorized Items - mdly-2019
Label | Element | Value |
Income Taxes Paid, Net | us-gaap_IncomeTaxesPaidNet | $ 933,000 |
Interest Paid, Including Capitalized Interest, Operating and Investing Activities | us-gaap_InterestPaid | 8,664,000 |
Accounting Standards Update 2016-09 [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 32,000 |
Accounting Standards Update 2016-09 [Member] | Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 32,000 |
Accounting Standards Update 2014-09 [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | (3,599,000) |
Accounting Standards Update 2014-09 [Member] | Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | (3,599,000) |
Accounting Standards Update 2016-01 And 2018-02 [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 0 |
Accounting Standards Update 2016-01 And 2018-02 [Member] | Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | (10,968,000) |
Accounting Standards Update 2016-01 And 2018-02 [Member] | AOCI Including Portion Attributable to Noncontrolling Interest [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 10,968,000 |