XML 47 R14.htm IDEA: XBRL DOCUMENT

RELATED PARTY TRANSACTIONS	6 Months Ended
Aug. 01, 2015
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS	NOTE 8: RELATED PARTY TRANSACTIONS Atlantic Retail Investors, LLC, which is partially owned by Michael J. Hayes, a director of the Company and Chairman of the Company’s board of directors, owns the land and buildings occupied by three Fred’s stores. Richard H. Sain, Senior Vice President of Retail Pharmacy Business Development owns the land and building occupied by one of Fred’s Xpress Pharmacy locations. The terms and conditions regarding the leases on these locations are consistent in all material respects with other stores leases of the Company with unrelated landlords. The total rental payments related to related party leases were $288.0 thousand and $159.4 thousand for the twenty-six weeks ended August 1, 2015 and August 2, 2014, respectively. The increase is due to the timing of property tax and insurance payments for the store locations as well as the addition of the Xpress pharmacy location. On April 10, 2015, the Company completed the acquisition of Reeves-Sain Drug Store, Inc., a provider of retail and specialty pharmaceutical services. As part of the total consideration for the purchase, Fred’s provided notes payable totaling $13.0 million to the sellers of Reeves-Sain Drug Store, Inc. who joined Fred’s as part of the acquisition. The notes payable are due in three equal installments to be paid on January 31^st of 2021, 2022 and 2023 and are subordinate to the revolving line of credit. The notes payable have a potential to earn additional contingent consideration if certain growth objectives are met for which the Company has accrued an additional $1.0 million. See Note 11 – Business Combinations for further discussion of the acquisition.

RELATED PARTY TRANSACTIONS

6 Months Ended

Aug. 01, 2015

NOTE 8: RELATED PARTY TRANSACTIONS

Atlantic Retail Investors, LLC, which is partially owned by Michael J. Hayes, a director of the Company and Chairman of the Company’s board of directors, owns the land and buildings occupied by three Fred’s stores. Richard H. Sain, Senior Vice President of Retail Pharmacy Business Development owns the land and building occupied by one of Fred’s Xpress Pharmacy locations. The terms and conditions regarding the leases on these locations are consistent in all material respects with other stores leases of the Company with unrelated landlords. The total rental payments related to related party leases were $288.0 thousand and $159.4 thousand for the twenty-six weeks ended August 1, 2015 and August 2, 2014, respectively. The increase is due to the timing of property tax and insurance payments for the store locations as well as the addition of the Xpress pharmacy location.

On April 10, 2015, the Company completed the acquisition of Reeves-Sain Drug Store, Inc., a provider of retail and specialty pharmaceutical services. As part of the total consideration for the purchase, Fred’s provided notes payable totaling $13.0 million to the sellers of Reeves-Sain Drug Store, Inc. who joined Fred’s as part of the acquisition. The notes payable are due in three equal installments to be paid on January 31^st of 2021, 2022 and 2023 and are subordinate to the revolving line of credit. The notes payable have a potential to earn additional contingent consideration if certain growth objectives are met for which the Company has accrued an additional $1.0 million. See Note 11 – Business Combinations for further discussion of the acquisition.

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

+ References + Details