FMAR » Topics » (7) Related Party Transactions

These excerpts taken from the FMAR 10-K filed Mar 31, 2009.

(8) Related Party Transactions

        During the ordinary course of business, we make loans to our directors and their affiliates and several of our policy making officers on substantially the same terms, including interest rates and

93


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collateral, as those prevailing for comparable transactions with other customers. During the years ended December 31, 2008, 2007, and 2006, transactions in related party loans were as follows:

(dollars in thousands)   2008   2007   2006  

Beginning balance

  $ 25   $ 23   $ 1,628  

Additions

    2,324     8     23  

Repayments

    (4 )   (6 )   (957 )

Change in officers/directors

    366         (671 )
               

  $ 2,711   $ 25   $ 23  
               

        Unused loan commitments to directors and policy making officers totaled $1.592 million as of December 31, 2008 and $594,000 as of December 31, 2007. Letters of credit included in the unused loan commitments above and in the totals in Note 6 above issued on behalf of directors and policy making officers totaled $400,000 for December 31, 2007. There were no such comparable letters of credit as of December 31, 2008.

        We currently lease 84,000 square feet of a building owned by Edwin F. Hale, Sr., CEO of the Company, for our executive offices and various operational departments. We paid $2.654 million, $2.364 million, and $1.091 million in rent on this location in 2008, 2007, and 2006, respectively.

        We leased from Hale Properties, LLC, a company owned by Mr. Hale, 34,500 square feet of general office space at 1516 Baylis Street, Baltimore, Maryland, which housed a significant portion of the Company's servicing and operations units. We vacated this space before the end of 2006, moving our operational divisions into the new executive office tower on South Clinton Street and into our old executive office building on Boston Street. We paid $209,000 in rent expense on this location in 2006.

        We also leased 18,400 square feet of storage space and disaster recovery facilities at two other locations owned by Mr. Hale. In 2008, 2007, and 2006, we paid $24,000, $75,000, and $86,000, respectively, in rent for these facilities. During 2008, Mr. Hale sold the storage facility to an unaffiliated third party.

        The Bank sponsors the activities of the Baltimore Blast, a professional soccer team owned by Mr. Hale. The Bank paid approximately $176,000 in 2008, $175,000 in 2007, and $176,000 in 2006 for a sponsorship package which includes printed material and Bank banners displayed at Baltimore Blast games, prize giveaways, free tickets, and employee recognition nights. In addition to the Bank sponsorship, Mariner Finance paid approximately $20,000 in each of 2008, 2007, and 2006 in sponsorship of Baltimore Blast activities.

        We have obtained the naming rights to the major indoor sports/entertainment facility in Baltimore from Mr. Hale who obtained them from the City of Baltimore. We pay Mr. Hale $75,000 per year for the naming rights, which is the same as Mr. Hale pays the City of Baltimore. We have a letter of credit with the City of Baltimore in the amount of $375,000 securing performance under the contract.

        All related party transactions are subject to review by management and the Audit Committee and approved by the full Board of Directors. We believe that the terms for all related party transactions are at least as favorable as those that could be obtained from a third party.

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(8) Related Party Transactions



        During the ordinary course of business, we make loans to our directors and their affiliates and several of our policy making officers
on substantially the same terms, including interest rates and



93









HREF="#bg45801a_main_toc">Table of Contents






collateral,
as those prevailing for comparable transactions with other customers. During the years ended December 31, 2008, 2007, and 2006, transactions in related party loans were as follows:


















































































































(dollars in thousands)  2008  2007  2006  

Beginning balance

 $25 $23 $1,628 

Additions

  2,324  8  23 

Repayments

  (4) (6) (957)

Change in officers/directors

  366    (671)
        

 $2,711 $25 $23 
        




        Unused
loan commitments to directors and policy making officers totaled $1.592 million as of December 31, 2008 and $594,000 as of December 31, 2007. Letters of
credit included in the unused loan commitments above and in the totals in Note 6 above issued on behalf of directors and policy making officers totaled $400,000 for December 31, 2007.
There were no such comparable letters of credit as of December 31, 2008.



        We
currently lease 84,000 square feet of a building owned by Edwin F. Hale, Sr., CEO of the Company, for our executive offices and various operational departments. We paid
$2.654 million, $2.364 million, and $1.091 million in rent on this location in 2008, 2007, and 2006, respectively.



        We
leased from Hale Properties, LLC, a company owned by Mr. Hale, 34,500 square feet of general office space at 1516 Baylis Street, Baltimore, Maryland, which housed a
significant portion of the Company's servicing and operations units. We vacated this space before the end of 2006, moving our operational divisions into the new executive office tower on South Clinton
Street and into our old executive office building on Boston Street. We paid $209,000 in rent expense on this location in 2006.




        We
also leased 18,400 square feet of storage space and disaster recovery facilities at two other locations owned by Mr. Hale. In 2008, 2007, and 2006, we paid $24,000, $75,000,
and $86,000, respectively, in rent for these facilities. During 2008, Mr. Hale sold the storage facility to an unaffiliated third party.



        The
Bank sponsors the activities of the Baltimore Blast, a professional soccer team owned by Mr. Hale. The Bank paid approximately $176,000 in 2008, $175,000 in 2007, and $176,000
in 2006 for a sponsorship package which includes printed material and Bank banners displayed at Baltimore Blast games, prize giveaways, free tickets, and employee recognition nights. In addition to
the Bank sponsorship, Mariner Finance paid approximately $20,000 in each of 2008, 2007, and 2006 in sponsorship of Baltimore Blast activities.



        We
have obtained the naming rights to the major indoor sports/entertainment facility in Baltimore from Mr. Hale who obtained them from the City of Baltimore. We pay
Mr. Hale $75,000 per year for the naming rights, which is the same as Mr. Hale pays the City of Baltimore. We have a letter of credit with the City of Baltimore in the amount of $375,000
securing performance under the contract.



        All
related party transactions are subject to review by management and the Audit Committee and approved by the full Board of Directors. We believe that the terms for all related party
transactions are at least as favorable as those that could be obtained from a third party.



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(8) Related Party Transactions



        During the ordinary course of business, we make loans to our directors and their affiliates and several of our policy making officers
on substantially the same terms, including interest rates and



93









HREF="#bg45801a_main_toc">Table of Contents






collateral,
as those prevailing for comparable transactions with other customers. During the years ended December 31, 2008, 2007, and 2006, transactions in related party loans were as follows:


















































































































(dollars in thousands)  2008  2007  2006  

Beginning balance

 $25 $23 $1,628 

Additions

  2,324  8  23 

Repayments

  (4) (6) (957)

Change in officers/directors

  366    (671)
        

 $2,711 $25 $23 
        




        Unused
loan commitments to directors and policy making officers totaled $1.592 million as of December 31, 2008 and $594,000 as of December 31, 2007. Letters of
credit included in the unused loan commitments above and in the totals in Note 6 above issued on behalf of directors and policy making officers totaled $400,000 for December 31, 2007.
There were no such comparable letters of credit as of December 31, 2008.



        We
currently lease 84,000 square feet of a building owned by Edwin F. Hale, Sr., CEO of the Company, for our executive offices and various operational departments. We paid
$2.654 million, $2.364 million, and $1.091 million in rent on this location in 2008, 2007, and 2006, respectively.



        We
leased from Hale Properties, LLC, a company owned by Mr. Hale, 34,500 square feet of general office space at 1516 Baylis Street, Baltimore, Maryland, which housed a
significant portion of the Company's servicing and operations units. We vacated this space before the end of 2006, moving our operational divisions into the new executive office tower on South Clinton
Street and into our old executive office building on Boston Street. We paid $209,000 in rent expense on this location in 2006.




        We
also leased 18,400 square feet of storage space and disaster recovery facilities at two other locations owned by Mr. Hale. In 2008, 2007, and 2006, we paid $24,000, $75,000,
and $86,000, respectively, in rent for these facilities. During 2008, Mr. Hale sold the storage facility to an unaffiliated third party.



        The
Bank sponsors the activities of the Baltimore Blast, a professional soccer team owned by Mr. Hale. The Bank paid approximately $176,000 in 2008, $175,000 in 2007, and $176,000
in 2006 for a sponsorship package which includes printed material and Bank banners displayed at Baltimore Blast games, prize giveaways, free tickets, and employee recognition nights. In addition to
the Bank sponsorship, Mariner Finance paid approximately $20,000 in each of 2008, 2007, and 2006 in sponsorship of Baltimore Blast activities.



        We
have obtained the naming rights to the major indoor sports/entertainment facility in Baltimore from Mr. Hale who obtained them from the City of Baltimore. We pay
Mr. Hale $75,000 per year for the naming rights, which is the same as Mr. Hale pays the City of Baltimore. We have a letter of credit with the City of Baltimore in the amount of $375,000
securing performance under the contract.



        All
related party transactions are subject to review by management and the Audit Committee and approved by the full Board of Directors. We believe that the terms for all related party
transactions are at least as favorable as those that could be obtained from a third party.



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These excerpts taken from the FMAR 10-K filed Mar 14, 2008.

(7) Related Party Transactions

        During the ordinary course of business, we make loans to our directors and their affiliates and several of our policy making officers on substantially the same terms, including interest rates and

79



collateral, as those prevailing for comparable transactions with other customers. During the years ended December 31, 2007, 2006, and 2005, transactions in related party loans were as follows:

(dollars in thousands)

  2007
  2006
  2005
 
Beginning balance   $ 23   $ 1,628   $ 1,882  
Additions     8     23     247  
Repayments     (6 )   (957 )   (501 )
Change in officers/directors         (671 )    
   
 
 
 
    $ 25   $ 23   $ 1,628  
   
 
 
 

        Unused loan commitments to directors and policy making officers totaled $594,000 as of December 31, 2007 and $992,000 as of December 31, 2006. Letters of credit included in the unused loan commitments above and in the totals in Note 6 above issued on behalf of directors and policy making officers totaled $400,000 for December 31, 2007 compared to $763,000 at December 31, 2006.

        We currently lease 75,500 square feet of a building owned by Edwin F. Hale, Sr., CEO of the Company, for our executive offices and various operational departments. We began to occupy the space in August of 2006. We paid $2.364 million and $1.091 million in rent on this location in 2007 and 2006, respectively.

        We leased from Hale Properties, LLC, a company owned by Mr. Hale, 34,500 square feet of general office space at 1516 Baylis Street, Baltimore, Maryland, which housed a significant portion of the Company's servicing and operations units. We vacated this space before the end of 2006, moving our operational divisions into the new executive office tower on South Clinton Street and into our old executive office building on Boston Street. We paid $209,000 and $389,000 in rent expense on this location in 2006 and 2005, respectively.

        We also leased 18,400 square feet of storage space and disaster recovery facilities at two other locations owned by Mr. Hale. In 2007, 2006, and 2005, we paid $75,000, $86,000, and $83,000, respectively, in rent for these facilities. During 2006, we vacated the storage facility.

        For the first three months of 2005, we also leased our (former) headquarters building from Hale Properties, LLC. Rent expense on this location amounted to approximately $334,000 for 2005. In March of 2005, we purchased the building from Mr. Hale for a purchase price of $20 million.

        The Bank sponsors the activities of the Baltimore Blast, a professional soccer team owned by Mr. Hale. The Bank paid approximately $175,000 in 2007 and $176,000 in 2006 for a sponsorship package which includes printed material and Bank banners displayed at Baltimore Blast games, prize giveaways, free tickets, and employee recognition nights. In addition to the Bank sponsorship, Mariner Finance paid approximately $20,000 in both 2007 and 2006 in sponsorship of Baltimore Blast activities. We have letters of credit with the Baltimore Blast in the amount of $400,000 that are secured by cash.

        We have obtained the naming rights to the major indoor sports/entertainment facility in Baltimore from Mr. Hale who obtained them from the City of Baltimore. We pay Mr. Hale $75,000 per year for the naming rights, which is the same as Mr. Hale pays the City of Baltimore. We have a letter of credit with the City of Baltimore in the amount of $375,000 securing performance under the contract.

        All related party transactions are subject to review by management and the Audit Committee and approved by the full Board of Directors. We believe that the terms for all related party transactions are at least as favorable as those that could be obtained from a third party.

80


(7) Related Party Transactions



        During the ordinary course of business, we make loans to our directors and their affiliates and several of our policy making officers on substantially the same
terms, including interest rates and



79











collateral,
as those prevailing for comparable transactions with other customers. During the years ended December 31, 2007, 2006, and 2005, transactions in related party loans were as follows:




































































































(dollars in thousands)

 2007
 2006
 2005
 
Beginning balance $23 $1,628 $1,882 
Additions  8  23  247 
Repayments  (6) (957) (501)
Change in officers/directors    (671)  
  
 
 
 
  $25 $23 $1,628 
  
 
 
 




        Unused
loan commitments to directors and policy making officers totaled $594,000 as of December 31, 2007 and $992,000 as of December 31, 2006. Letters of credit included in
the unused loan commitments above and in the totals in Note 6 above issued on behalf of directors and policy making officers totaled $400,000 for December 31, 2007 compared to $763,000
at December 31, 2006.



        We
currently lease 75,500 square feet of a building owned by Edwin F. Hale, Sr., CEO of the Company, for our executive offices and various operational departments. We began to occupy the
space in August of 2006. We paid $2.364 million and $1.091 million in rent on this location in 2007 and 2006, respectively.




        We
leased from Hale Properties, LLC, a company owned by Mr. Hale, 34,500 square feet of general office space at 1516 Baylis Street, Baltimore, Maryland, which housed a
significant portion of the Company's servicing and operations units. We vacated this space before the end of 2006, moving our operational divisions into the new executive office tower on South Clinton
Street and into our old executive office building on Boston Street. We paid $209,000 and $389,000 in rent expense on this location in 2006 and 2005, respectively.



        We
also leased 18,400 square feet of storage space and disaster recovery facilities at two other locations owned by Mr. Hale. In 2007, 2006, and 2005, we paid $75,000, $86,000,
and $83,000, respectively, in rent for these facilities. During 2006, we vacated the storage facility.



        For
the first three months of 2005, we also leased our (former) headquarters building from Hale Properties, LLC. Rent expense on this location amounted to approximately $334,000
for 2005. In March of 2005, we purchased the building from Mr. Hale for a purchase price of $20 million.



        The
Bank sponsors the activities of the Baltimore Blast, a professional soccer team owned by Mr. Hale. The Bank paid approximately $175,000 in 2007 and $176,000 in 2006 for a
sponsorship package which includes printed material and Bank banners displayed at Baltimore Blast games, prize giveaways, free tickets, and employee recognition nights. In addition to the Bank
sponsorship, Mariner Finance paid approximately $20,000 in both 2007 and 2006 in sponsorship of Baltimore Blast activities. We have letters of credit with the Baltimore Blast in the amount of $400,000
that are secured by cash.



        We
have obtained the naming rights to the major indoor sports/entertainment facility in Baltimore from Mr. Hale who obtained them from the City of Baltimore. We pay
Mr. Hale $75,000 per year for the naming rights, which is the same as Mr. Hale pays the City of Baltimore. We have a letter of credit with the City of Baltimore in the amount of $375,000
securing performance under the contract.



        All
related party transactions are subject to review by management and the Audit Committee and approved by the full Board of Directors. We believe that the terms for all related party
transactions are at least as favorable as those that could be obtained from a third party.



80









This excerpt taken from the FMAR 10-K filed Mar 16, 2007.

(6)  Related Party Transactions

During the ordinary course of business, we make loans to our directors and their affiliates and several of our policy making officers on substantially the same terms, including interest rates and collateral, as those prevailing for comparable transactions with other customers.  During the years ended December 31, 2006, 2005, and 2004, transactions in related party loans were as follows:

(dollars in thousands)

 

2006

 

2005

 

2004

 

Beginning balance

 

$

1,628

 

$

1,882

 

$

2,352

 

Additions

 

23

 

247

 

80

 

Repayments

 

(957

)

(501

)

(550

)

Change in officers/directors

 

(671

)

 

 

 

 

$

23

 

$

1,628

 

$

1,882

 

 

Unused loan commitments to directors and policy making officers totaled $992,000 as of December 31, 2006 and $1.410 million as of December 31, 2005. Letters of credit included in the totals in Note 5 above issued on behalf of directors and policy making officers totaled $763,000 for December 31, 2006 compared to $780,000 at December 31, 2005.

During 2006, we leased from Hale Properties, LLC, a company owned by Edwin F. Hale, Sr., CEO of the Company, 34,500 square feet of general office space at 1516 Baylis Street, Baltimore, Maryland, which housed a significant portion of the Company’s servicing and operations units. We paid $209,000 in rent expense on this location in 2006. We vacated a substantial majority of this space before the end of 2006, moving our operational divisions into the new executive office tower on South Clinton Street and into our old executive office building on Boston Street.

We also leased 18,400 square feet of storage space and disaster recovery facilities at two other locations owned by Mr. Hale. In 2006, we paid $86,000 in rent for these facilities. During 2006 we vacated the storage facility.

In June of 2006, we moved our executive offices and various operational departments into a new building owned by Mr. Hale. We currently lease 74,061 square feet of the building from Mr. Hale and paid $1.091 million in rent on this location in 2006. This building is adjacent to the former headquarters building at 3301 Boston Street. The additional space will be utilized for growth.

The Company sponsors the activities of the Baltimore Blast, a professional soccer team owned by Mr. Hale. The Company paid approximately $176,000 for a sponsorship package which includes printed material and Company banners displayed at Baltimore Blast games, prize giveaways, free tickets, and

71




employee recognition nights. We have a letter of credit with the Baltimore Blast in the amount of $400,000 that is secured by cash.

We have obtained the naming rights to the major indoor sports/entertainment facility in Baltimore from Mr. Hale who obtained them from the City of Baltimore. We pay Mr. Hale $75,000 per year for the naming rights, which is the same as Mr. Hale pays the City of Baltimore. We have a letter of credit with the City of Baltimore in the amount of $375,000 securing performance under the contract.

We have a letter of credit with Canton Crossing, LLC, a limited liability company wholly owned by Mr. Hale for $363,000 that is secured by cash.

All related party transactions are subject to review by management and the Audit Committee and approved by the full Board of Directors. We believe that the terms for all related party transactions are at least as favorable as those that could be obtained from a third party.

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