| Related Parties |
Related Parties
On December 31, 2017, the Company sold an indirect wholly owned subsidiary to an immediate family member of a Senior Vice President of the Company ("Purchaser of subsidiary") in consideration for an interest-bearing note receivable in the amount of $1.0 million, which approximated the net book value of the disposed entity. At December 31, 2018, $0.1 million and $0.7 million was reflected on the Company's Consolidated Balance Sheet within other current assets and other assets, respectively, representing the remaining balances on this note receivable. In connection with this transaction, the Company also received an interest-bearing note receivable from the disposed entity ("Disposed entity") on December 31, 2017 in the amount of $1.0 million representing certain accounts payable of the disposed subsidiary that were paid by the Company. At December 31, 2018, $0.1 million and $0.8 million was reflected on the Company's Consolidated Balance Sheet within other current assets and other assets, respectively, representing the remaining balance on this note receivable. Remaining principal and interest payments are scheduled to be made in periodic installments during fiscal year 2019 through fiscal year 2026.
From time to time, the Company conducts business with the following related parties:
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On January 30, 2015, a subsidiary of the Company entered into a master services subcontract with Austin Trucking, LLC ("Austin Trucking"), an entity owned by an immediate family member of a Senior Vice President of the Company. Pursuant to the agreement, Austin Trucking performs subcontract work for the subsidiary of the Company, including trucking services. |
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From time to time, a subsidiary of the Company provides construction services to various companies owned by a family member of a Senior Vice President of the Company ("Construction Services"). |
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For periodic corporate events, the Company charters a boat from Deep South Adventures, LLC, which is owned by a Senior Vice President of the Company. |
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The Company rents vehicles on a month-to-month basis from an entity owned by a family member of a Senior Vice President of the Company ("Vehicle Rentals"). |
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Family members of a Senior Vice President of the Company provide consulting services to a subsidiary of the Company ("Consulting Services"). |
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A law firm previously owned by a family member of a Senior Vice President of the Company provided legal services to a subsidiary of the Company ("Legal Services"). |
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A subsidiary of the Company leases office space for its Dothan, Alabama office from H&K, Ltd. ("H&K"), an entity partially owned by a Senior Vice President of the Company. The office space is leased through early 2020. Under the lease agreement, the Company pays a fixed minimum rent per month. |
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A subsidiary of the Company leased office space for its Montgomery, Alabama office from H&A Properties LLC ("H&A"), an entity partially owned by two Senior Vice Presidents of the Company. Under the lease agreement, the Company paid a fixed minimum rent per month. In September 2018, the subsidiary purchased this office from H&A for $0.5 million.
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On June 1, 2014, the Company entered into an access agreement with Island Pond Corporate Services, LLC ("Island Pond"), which provides a location for the Company to conduct business development activities from time to time on a property owned by the Executive Chairman of the Company's Board of Directors, who is also the Managing Partner of SunTx. |
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A company owned by an immediate family member of a Senior Vice President of the Company provides subcontracting services to a subsidiary of the Company ("Subcontracting Services"). |
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The Company is party to a management services agreement with SunTx, under which the Company pays SunTx $0.25 million per fiscal quarter and reimburses certain travel and other out-of-pocket expenses.
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The following table presents revenues earned and expenses incurred by the Company during the three months ended December 31, 2018 and December 31, 2017, if and to the extent the Company engaged in transactions with the parties described above during the respective periods, and accounts receivable and accounts payable balances at December 31, 2018 and September 30, 2018, related to transactions with such parties (in thousands):
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Revenue Earned (Expense Incurred) |
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Accounts Receivable (Payable) |
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For the Three Months Ended December 31, |
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December 31, |
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September 30, |
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2018 |
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2017 |
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2018 |
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2018 |
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(unaudited) |
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(unaudited) |
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(unaudited) |
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Purchaser of subsidiary |
$ |
— |
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$ |
— |
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$ |
864 |
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$ |
850 |
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Disposed entity |
$ |
— |
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$ |
— |
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$ |
952 |
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$ |
937 |
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Austin Trucking |
$ |
(3,089 |
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(1) |
$ |
(2,945 |
) |
(1) |
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$ |
(266 |
) |
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$ |
(790 |
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Construction Services |
$ |
113 |
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$ |
1,291 |
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$ |
2,466 |
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$ |
2,863 |
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Deep South Adventures, LLC |
$ |
— |
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(2) |
$ |
(33 |
) |
(2) |
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$ |
— |
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$ |
— |
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Vehicle Rentals |
$ |
(289 |
) |
(2) |
$ |
(288 |
) |
(2) |
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$ |
— |
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$ |
— |
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Consulting Services |
$ |
(67 |
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(2) |
$ |
(60 |
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(2) |
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$ |
— |
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$ |
— |
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Legal Services |
$ |
— |
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(2) |
$ |
(58 |
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(2) |
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$ |
— |
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$ |
— |
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H&K |
$ |
(21 |
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(2) |
$ |
(21 |
) |
(2) |
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$ |
— |
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$ |
— |
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H&A |
$ |
— |
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(2) |
$ |
(17 |
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(2) |
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$ |
— |
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$ |
— |
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Island Pond |
$ |
(80 |
) |
(2) |
$ |
(80 |
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(2) |
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$ |
— |
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$ |
— |
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Subcontracting Services |
$ |
(193 |
) |
(1) |
$ |
— |
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(1) |
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$ |
— |
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$ |
(52 |
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SunTx |
$ |
(254 |
) |
(2) |
$ |
(340 |
) |
(2) |
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$ |
— |
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$ |
— |
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(1) Cost is reflected as cost of revenues on the Company's Consolidated Statements of Income.
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(2) Cost is reflected as general and administrative expenses on the Company's Consolidated Statements of Income.
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