Annual report pursuant to Section 13 and 15(d)

Related Party Transactions

Related Party Transactions
12 Months Ended
Dec. 31, 2018
Related Party Transactions [Abstract]  
Related Party Transactions

15.  Related Party Transactions

BBX Capital may be deemed to be controlled by Alan B. Levan, Chairman of BBX Capital, and John E. Abdo, Vice Chairman of BBX Capital. Together, Messrs. Levan and Abdo may be deemed to beneficially own shares of BBX Capital’s Class A Common Stock and Class B Common Stock representing approximately 77% of BBX Capital’s total voting power. Mr. Levan and Mr. Abdo serve as our Chairman and Vice Chairman, respectively.

In April 2015, pursuant to a Loan Agreement and Promissory Note, our wholly owned subsidiary provided an $80.0 million loan to BBX Capital. Amounts outstanding on the loan bore interest at a rate of 10% per annum until July 2017 when the interest rate was reduced to 6% per annum. Payments of interest are required on a quarterly basis, with all outstanding amounts being due and payable at the end of the five-year term. BBX Capital is permitted to prepay the loan in whole or in part at any time, and prepayments will be required, to the extent necessary, in order for us or our subsidiaries to remain in compliance with covenants under outstanding indebtedness. During the years ended December 31, 2018, 2017 and 2016, we recognized $4.8 million, $6.4 million and $8.0 million, respectively, of interest income on the loan to BBX Capital. 

We paid or reimbursed BBX Capital or its affiliated entities $1.6 million,  $1.5 million and $1.3 million during 2018,  2017, and 2016, respectively, for management advisory, risk management, administrative and other services. We had accrued $0.1 million for the services described above as of both December 31, 2018 and 2017.  BBX Capital or its affiliates paid or reimbursed us $0.4 million, $0.1 million and $0.1 million for other shared services during 2018, 2017, and 2016, respectively.  As of as of December 31, 2018 and 2017, $0.1 million and $0.2 million, respectively, was due to us from BBX Capital for these services.  From 2013 until January 2016, employees of a BBX Capital subsidiary were provided health insurance under policies maintained by us. BBX Capital’s subsidiary reimbursed us at cost, which was approximately $0.2 million during 2016. 

During 2018,  2017, and 2016, we paid dividends of $40.4 million,  $40.0 million, and $70.0 million, respectively, to BBX Capital, our sole shareholder until our initial public offering in November 2017

During 2018 and 2017, we paid $0.9 million and $0.6 million, respectively, for the acquisition of inventory from a company whose President is the son of David L. Pontius, our former Executive Vice President and Chief Operating Officer. 

See also the description of the Agreement to Allocate Consolidated Income Tax Liability and Benefits under Note 12: Income Taxes above.