Transactions With Related Parties

3 Months Ended

Jul. 31, 2017

Transactions With Related Parties

Transactions With Related Parties

8. 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 that meet the SEC definition of related parties. At July 31, 2017, 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, 2017 and 2016. Rent expense related to these leases is recorded in “Selling, general and administrative” expenses.

The Company purchases inventories from 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 $3,481 and $3,165 in the three months ended July 31, 2017 and 2016, respectively. Amounts due to SWP for purchases of inventory for distribution as of July 31, 2017 and April 30, 2017 were $1,135 and $1,091, respectively, and are included in “Accounts payable”.

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, which is included in “Selling, general and administrative” expenses in the Condensed Consolidated Statements of Operations and Comprehensive Income.