Indemnification Agreements
We entered into an indemnification agreement with each of our executive officers and directors that provides, in general, that we will indemnify them to
the fullest extent permitted by law in connection with their service to us or on our behalf.
Family Relationships
Trey Baldwin and John Baldwin, brothers of Lowry Baldwin, our Board Chair, received $236,000 and $440,000, respectively, from the Company in risk advisor
commissions since the beginning of the fiscal year ended December 31, 2021.
Other Related
Person Transactions
Commissions Revenue
The Company serves as a broker for the Holding Company of the Villages, Inc. (The Villages) and certain affiliated entities. Since the
beginning of the fiscal year ended December 31, 2021, commissions revenue recorded as a result of transactions with The Villages and its affiliated entities was approximately $2.9 million.
The Company serves as a broker for an entity in which Chris Sullivan, a member of our Board of Directors, owns approximately 35%. Since the beginning of
the fiscal year ended December 31, 2021, commissions revenue recorded as a result of transactions with such entity was approximately $191,000.
Rent Expenses
The Company is a party to various agreements to lease office space from wholly-owned subsidiaries of The
Villages. Rent expense ranges from approximately $3,000 to $28,000 per month, per lease. Lease agreements expire on various dates through 2025. Since the beginning of fiscal year ended December 31, 2021, total rent expense incurred with respect
to The Villages and its wholly-owned subsidiaries was $603,000.
Ownership Interest Redemption
On December 3, 2021, certain trusts controlled by Lowry Baldwin exchanged 500,000 LLC Units and the corresponding 500,000 shares of Class B
common stock for 500,000 shares of Class A common stock.
Related Person Transactions
Policies and Procedures
We adopted a written Related Person Transactions Policy (the Policy), which sets forth our policy with
respect to the review, approval, ratification and disclosure of all related person transactions by our Audit Committee. In accordance with the Policy, our Audit Committee has overall responsibility for implementation of and compliance with the
Policy.
For purposes of the Policy, a related person transaction is a transaction, arrangement or relationship (or any series of similar
transactions, arrangements or relationships) in which a related person has or will have a direct or indirect material interest, as determined by the Audit Committee. The Policy contains certain enumerated exceptions to transactions that would
otherwise fall within the definition of related person transaction, including, among others, where the transaction involves the purchase or sale of products or services in the ordinary course and the amount does not exceed the lesser of
(i) $120,000 and (ii) one percent of the average of our total assets at year end for the last two completed fiscal years.
The Policy requires
that notice of a proposed related person transaction be provided to our legal department prior to entry into such transaction. If our legal department determines that such transaction is a potential related person transaction, the proposed
transaction will be submitted to our Audit Committee for consideration at its next meeting. Under the Policy, our Audit Committee may approve only those potential related person transactions that are in, or not inconsistent with, the Companys
best interests. In the event that we become aware of a related person transaction that has not been previously reviewed, approved or ratified under the Policy and that is ongoing or is completed, the transaction will be submitted to the Audit
Committee so that it may determine whether to ratify, rescind or terminate the related person transaction.
The Policy also provides that the Audit
Committee review certain previously approved or ratified related person transactions that are ongoing to determine whether the related person transaction remains in our best interests and the best interests of our shareholders. Additionally, we will
make periodic inquiries of directors and executive officers with respect to any potential related person transaction of which they may be a party or of which they may be aware.
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