INTL FCStone 2005 Annual Report Download - page 60

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INTERNATIONAL ASSETS HOLDING CORPORATION AND SUBSIDIARIES
Notes to the Consolidated Financial Statements—(Continued)
September 30, 2005 and 2004
(8) Commissions, net
Commission revenues, net of $512,796 and $903,507 reported for the years ended September 30, 2005 and
2004, were primarily related to introducing broker fees that the Company received in connection with its debt
capital markets activities.
2005 2004
Wholesale commission revenue .......................... $731,588 $1,616,851
Amounts paid to wholesale third party ..................... (218,792) (713,344)
Commission revenue, net ........................... $512,796 $ 903,507
(9) Related Party Transactions
In March 2004, the Company issued $12,000,000 in principal amount of the Company’s Notes due 2014.
Executive officers and directors of the Company participated in the offering and purchased $1,282,500 of the
Notes. In August 2004, the Company converted the outstanding notes into common shares. At conversion, the
Notes owned by the officers and directors were converted into 223,042 common shares. In March 2004, the
shareholders approved the issuance of the common shares upon the conversion of the Notes, including the
issuances to the Company’s executive officers and directors. See note 3 for additional information regarding the
issuance and conversion of the Notes.
One of the Company’s principal shareholders has made an investment, valued at approximately $95,000,000
as of September 30, 2005, in a hedge fund managed by INTL Consilium. In November 2004, an executive of this
shareholder was elected to the Board of Directors of the Company.
Two executive officers of the Company have individually made investments, either directly or indirectly,
collectively valued at approximately $577,000, in a hedge fund managed by INTL Consilium.
On August 9, 2002, the Company entered into a list brokerage agreement between Veitia & Associates
(V&A) and the Company regarding the management and leasing of the Company’s list rental access, for the
period October 1, 2002 to December 13, 2004. V&A received 90% of any proceeds generated by V&A from this
agreement. V&A is a company solely owned and controlled by the Company’s Executive Chairman. During the
year ended September 30, 2005 and 2004, V&A received $868 and $8,730, respectively, under this agreement.
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