On December 28, 2012, Institutional Financial Markets, Inc. (the "Company") entered into a Preferred Stock Exchange Agreement (the "Exchange Agreement") with Cohen Bros. Financial, LLC ("Cohen Bros."), a wholly-owned entity of Daniel G. Cohen, the Chairman, Chief Executive Officer and Chief Investment Officer of both the Company and its direct subsidiary, IFMI, LLC. Pursuant to the Exchange Agreement, Cohen Bros. exchanged with the Company 4,983,557 shares of Series B Voting Non-Convertible Preferred Stock of the Company (collectively, the "Series B Shares"), representing all of the issued and outstanding Series B Shares, for 4,983,557 newly issued shares of Series D Voting Non-Convertible Preferred Stock of the Company (collectively, the "Series D Shares").

The Series B Shares and the Series D Shares have substantially identical rights, preferences, privileges and restrictions except that the mandatory redemption by the Company of the Series D Shares will occur on December 31, 2013 rather than the mandatory redemption by the Company of the Series B Shares on December 31, 2012.

Pursuant to the Exchange Agreement, the Series B Shares have been cancelled. The Exchange Agreement contains customary representations, warranties, agreements and obligations of the parties. In addition, Cohen Bros. and Mr. Cohen both agreed to exercise any rights to have their units of IFMI, LLC redeemed no earlier than December 31, 2013, the same date as the mandatory redemption of the Series D Shares.

The foregoing description of the Exchange Agreement does not purport to be complete and is qualified in its entirety by reference to the Exchange Agreement, which is attached as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated into this report by reference.

The information set forth under "Item 1.01 Entry into a Material Definitive Agreement" is incorporated into this Item 3.02 by reference. In issuing the Series D Shares without registration, the Company relied upon the exemptions contained in Section 3(a)(9) and/or Section 4(a)(2) of the Securities Act of 1933, as amended.

In connection with the Company's entering into the Exchange Agreement, the Institutional Financial Markets, Inc. Articles Supplementary Series D Voting Non-Convertible Preferred Stock (the "Articles Supplementary") were filed with the Secretary of State of the State of Maryland and became effective on December 28, 2012. The Articles Supplementary are attached as Exhibit 3.1 to this Current Report on Form 8-K and are incorporated herein by reference.

The information set forth under "Item 1.01 Entry into a Material Definitive Agreement" is incorporated into this Item 5.03 by reference.

(d) Exhibits

Exhibit
Number                                    Description

 3.1*        Institutional Financial Markets, Inc. Articles Supplementary Series D
             Voting Non-Convertible Preferred Stock.

10.1*        Preferred Stock Exchange Agreement by and between Institutional
             Financial Markets, Inc. and Cohen Bros. Financial, LLC, dated December
             28, 2012.

* Filed electronically herewith.