Related Party Transactions

12 Months Ended

Dec. 31, 2023

Related Party Transactions [Abstract]

Related Party Transactions

Related Party Transactions

When needed, we rent a plane under dry lease from a company owned by a member of Cactus Companies. These transactions are under short-term rental arrangements and the agreement governing these transactions does not qualify as a lease. Effective January 1, 2022, we pay a base hourly rent of $2,500 per flight hour of use (increased from $1,750 per flight hour) of the aircraft, payable monthly, for the hours of aircraft operation. During the year ended December 31, 2023, expense recognized in connection with these rentals totaled $0.3 million as compared to $0.2 million during each of the years ended December 31, 2022 and 2021. As of December 31, 2023 and 2022, we owed less than $0.1 million to the related party which are included in accounts payable in the consolidated balance sheets. We are also responsible for employing pilots and fuel expenses. Our Chief Executive Officer and President reimburse the Company up to $2,350 per day for their personal use of the pilots employed by the Company, depending on how many company pilots are utilized for the day.

The TRA agreement is with certain direct and indirect holders of CC Units (CW Unit Holders prior to the CC Reorganization), including certain of our officers, directors and employees. These TRA Holders have the right in the future to receive 85% of the net cash savings, if any, in U.S. federal, state and local income tax and franchise tax that Cactus Inc. actually realizes or is deemed to realize in certain circumstances. The total liability from the TRA as of December 31, 2023 was $270.9 million. We pay professional fees to assist with maintenance of the TRA and composite tax payments in advance of the state tax return filings which are reimbursable from the TRA Holders. As of December 31, 2023 and 2022, amounts due from the TRA

Holders for fees and estimated state tax payments made on their behalf totaled $0.3 million and $0.1 million, respectively. The balances are included in accounts receivable, net in the consolidated balance sheets.

Distributions made by Cactus Companies (Cactus LLC prior to the CC Reorganization) are generally required to be made pro rata among all its members. During the years ended December 31, 2023, 2022 and 2021, Cactus Companies (Cactus LLC prior to the CC Reorganization) distributed $75.8 million, $38.6 million and $30.6 million, respectively, to Cactus Inc. to fund its dividend, TRA liability and estimated tax payments. During the year ended December 31, 2023, Cactus Companies made pro rata distributions to the other members totaling $16.6 million. During the years ended December 31, 2022 and 2021, Cactus LLC made pro rata distributions to the other members totaling