Transactions With Related Parties

3 Months Ended

Jul. 31, 2016

Transactions With Related Parties

Transactions With Related Parties

9. Transactions With Related Parties

The Company leases office and warehouse facilities from partnerships or entities owned by certain stockholders of GMS Inc. and its subsidiaries and other GMS employees that were the owners of companies that the Company has acquired. At July 31, 2016, these leases had expiration dates through fiscal 2021. Rent expense related to these leases included in the accompanying Condensed Consolidated Financial Statements approximated $195 for the three months ended July 31, 2016 and 2015 and is recorded in “Selling, general and administrative” expenses.

The Company purchases inventories from its former subsidiary, Southern Wall Products, Inc. (“SWP”), on a continuing basis. Certain stockholders of the Company are stockholders of SWP, which was spun‑off from Gypsum Management and Supply, Inc. on August 31, 2012. The Company purchased inventory from SWP for distribution in the amount of $3,165 and $3,275 in the three months ended July 31, 2016 and 2015, respectively. Amounts due to SWP for purchases of inventory for distribution as of July 31, 2016 and April 30, 2016 were $863 and $1,097, respectively, and are included in “Accounts payable”. Purchases between Gypsum Management and Supply, Inc. and SWP prior to the spin‑off were accounted for as intercompany transactions and eliminated in consolidation.

In connection with the IPO, the Company terminated its management agreement with AEA Investors LP. The agreement required the Company to pay AEA an annual management fee of $2,250 per year following the Acquisition for advisory and consulting services. The Company paid the final payment of $188 in the three months ended July 31, 2016 and $563 in the three months ended July 31, 2015 which is included in “Selling, general and administrative” expenses in the Condensed Consolidated Statements of Operations and Comprehensive Income.