Note

Equity Method Investment

We own a minority investment in Transport Enterprise Leasing, LLC ("TEL"). TEL is a tractor and trailer equipment leasing company and used equipment reseller. We have

not

guaranteed any of TEL's debt and have

obligation to provide funding, services, or assets. In

May 2016,

the operating agreement with TEL was amended to, among other things, remove the previously agreed to fixed date purchase options. TEL’s majority owners are generally restricted from transferring their interests in TEL, other than to certain permitted transferees, without our consent. We sold

and

$0.1

million

tractors or trailers to TEL during the

nine

-months ended

September 30, 2019

and

2018

, respectively, and we received

$7.1

million

and

$5.9

million

, respectively, for providing various maintenance services, certain back-office functions, and for miscellaneous equipment. We recognized a net reversal of previously deferred gains totaling

less than

$0.1

million

and

$0.2

million

for the

nine

-months ended

September 30, 2019

and

2018

, respectively, representing

49%

of the gains on units sold to TEL less any gains previously deferred and recognized when the equipment was subsequently sold to a

third

party. Deferred gains, totaling

$0.2

million

September 30, 2019

, are being carried as a reduction in our investment in TEL. At

September 30, 2019

and

December 31, 2018

, we had accounts receivable from TEL of

$1.2

million

and

$5.1

million

, respectively, related to cash disbursements made pursuant to our performance of certain back-office and maintenance functions on TEL’s behalf.

We have accounted for our investment in TEL using the equity method of accounting, and thus our financial results include our proportionate share of TEL's

2019

net income through

September 30, 2019

, or

$7.5

million

. We received an equity distribution from TEL of

$1.2

million during the

nine

-months ended

September 30, 2019

and

none

for the same

2018

period. Our investment in TEL, totaling

$32.4

million

and

$26.1

million

, at

September 30, 2019

and

December 31, 2018

, respectively, is included in other assets in the accompanying condensed consolidated balance sheets.

See TEL's summarized financial information below:

(in thousands)	As of September 30,		As of December 31,
	2019		2018
Total Assets	$	388,116	$	299,864
Total Liabilities		331,219		254,919
Total Equity	$	56,897	$	44,945

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2019		2018		2019		2018
Revenue	$	30,709	$	25,437	$	82,683	$	74,152
Cost of Sales		6,302		6,568		17,213		23,738
Operating Expenses		16,634		12,493		42,775		34,322
Operating Income		7,773		6,376		22,695		16,092
Net Income	$	4,585	$	4,369	$	14,452	$	10,850