Related Party Transactions

6 Months Ended

Jun. 30, 2021

Related Party Transactions [Abstract]

Related Party Transactions

3. Related Party Transactions

At June 30, 2021 and December 31, 2020, the Company had an investment of $3,250,673 and $4,724,290, respectively, in The Gabelli U.S. Treasury Money Market Fund advised by Gabelli Funds, LLC, which is an affiliate of the Company. The amount is recorded in cash and cash equivalents in the Condensed Consolidated Statements of Financial Condition. Income earned from this investment totaled $8 and $5,909 for the three months ended June 30, 2021 and 2020, respectively, and $125 and $35,459 for the six months ended June 30, 2021 and 2020, respectively, and is included in dividends and interest in the Condensed Consolidated Statements of Operations.

For the three months ended June 30, 2021 and 2020, the Company earned $292,731 and $789,875 or approximately 52% and 72%, respectively, of its commission revenue from transactions executed on behalf of funds advised by Gabelli Funds, LLC. (“Gabelli Funds”) and private wealth management clients advised by GAMCO Asset Management Inc., (“GAMCO Asset”), each affiliates of the Company. For the six months ended June 30, 2021 and 2020, the Company earned $664,981 and $1,481,659 or approximately 54% and 67%, respectively, of its commission revenue from transactions executed on behalf of funds advised by Gabelli Funds and private wealth management clients advised by GAMCO Asset.

The Company participated as agent in the secondary offerings of the GAMCO Global Gold, Natural Resources & Income Trust (“GGN”). Pursuant to sales agreements between the parties, the Company earned no sales manager fees related to this offering during the three months ended June 30, 2021 and 2020. During the six months ended June 30, 2021 and 2020, the Company earned sales manager fees of $0 and $334,825, respectively. Sales manager fees are separately disclosed in the Condensed Consolidated Statements of Operations.

The Company participated in the secondary offerings of the preferred stock of affiliated closed end funds in December 2019. The final settlements were received during March 2020 resulting in additional underwriting profit of $30,488.

The Company pays AC a management fee equal to 20% of the Company’s year-to-date pretax profits before consideration of this fee. In the three months and six months ended June 30, 2021 and 2020, the Company did not pay a management fee to AC as there were no pretax profits.

AC has a sublease agreement with GBL that expired on April 1, 2020 and continues on a month to month basis. AC allocates this expense to the Company based on the percentage of square footage occupied by the Company’s employees (including pro rata allocation of common space). For the three months ended June 30, 2021 and 2020, the Company paid $26,111 and $26,211, respectively, under the sublease agreement. For the six months ended June 30, 2021 and 2020, the Company paid $52,242 and $53,324, respectively, under the sublease agreement. These amounts are included within occupancy and equipment expenses on the Condensed Consolidated Statements of Operations.