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Related Party Transactions
 6 Months Ended
Aug. 03, 2024
Related Party Transactions [Abstract]  
Related Party Transactions Related Party Transactions
Services Agreements with Hot Topic
Hot Topic Inc. (“Hot Topic”) is an entity indirectly controlled by affiliates of Sycamore. On March 21, 2019, we entered into an amended and restated services agreement with Hot Topic, which was subsequently amended on August 1, 2019, April 30, 2023 and May 3, 2024 (“Amended and Restated Services Agreement”). Under the Amended and Restated Services Agreement, Hot Topic provides us (or causes applicable third parties to provide) real estate leasing and construction
management services. We record payments made to Hot Topic under these service agreements in the applicable expense category in either cost of goods sold, or selling, general and administrative expenses.
During the three- and six-month periods ended August 3, 2024, Hot Topic charged us $0.5 million and $1.0 million, respectively, for various services under the applicable service agreements, all of which were recorded as components of selling, general and administrative expenses. During the three- and six-month periods ended July 29, 2023, Hot Topic charged us $0.5 million and $1.1 million, respectively, for various services under the applicable service agreements, all of which were recorded as components of selling, general and administrative expenses. As of the end of the second quarter of fiscal year 2024 and as of the end of fiscal year 2023, we owed $0.4 million and $0.2 million, respectively, to Hot Topic for these services which is included in due to related parties in our condensed consolidated balance sheets.
On August 1, 2019, we entered into a services agreement with Hot Topic, which was subsequently amended on July 31, 2022, September 30, 2022, December 1, 2022, January 1, 2024, and most recently, on May 30, 2024 (“Amended Reverse Services Agreement”). Under the Amended Reverse Services Agreement, Torrid provides Hot Topic with certain information technology services for a fixed fee. The May 30, 2024 amendment solely amends certain pricing information. The term of the Amended Reverse Services Agreement will end on October 25, 2025 or when it is terminated by us or Hot Topic.
During the three- and six-month periods ended August 3, 2024, we charged Hot Topic $0.1 million and $0.4 million, respectively, for these services. During the three- and six-month periods ended July 29, 2023, we charged Hot Topic $0.5 million and $0.9 million, respectively, for these services. As of the end of the second quarter of fiscal year 2024 and as of the end of fiscal year 2023, Hot Topic owed us $0.1 million and $0.1 million, respectively, for these services.
Hot Topic incurs certain direct expenses on our behalf, such as payments to our non-merchandise vendors and each month, we pay Hot Topic for these pass-through expenses. As of the end of the second quarter of fiscal year 2024, the net amount we owed Hot Topic for these expenses was $0.1 million, and as of the end of fiscal year 2023, the net amount we owed Hot Topic for these expenses was $0.4 million, which is included in due to related parties in our condensed consolidated balance sheets.
Sponsor Advisory Services Agreement
On May 1, 2015, we entered into an advisory services agreement with Sycamore, pursuant to which Sycamore agreed to provide strategic planning and other related services to us. We are obligated to reimburse Sycamore for its expenses incurred in connection with providing such advisory services to us. As of the end of the second quarter of fiscal year 2024 and as of the end of fiscal year 2023, there were no amounts due, and during the three- and six-month periods ended August 3, 2024 and July 29, 2023, no amounts were paid under this agreement.
From time to time, we reimburse Sycamore for certain management expenses it pays on our behalf. During the three-month periods ended August 3, 2024 and July 29, 2023, the amounts paid to Sycamore for these expenses were not material. During the six-month periods ended August 3, 2024 and July 29, 2023, the amounts paid to Sycamore for these expenses were not material. As of the end of the second quarter of fiscal year 2024 and as of the end of fiscal year 2023, there was no amount due.
Other Related Party Transactions
MGF Sourcing US, LLC, an entity indirectly controlled by affiliates of Sycamore, is one of our suppliers. During the three- and six-month periods ended August 3, 2024, cost of goods sold included $10.5 million and $22.5 million, respectively, related to the sale of merchandise purchased from this supplier. During the three- and six-month periods ended July 29, 2023, cost of goods sold included $15.6 million and $30.9 million, respectively, related to the sale of merchandise purchased from this supplier. As of the end of the second quarter of fiscal year 2024 and as of the end of fiscal year 2023, the net amounts we owed MGF Sourcing US, LLC for these purchases were $4.6 million and $8.9 million, respectively. This liability is included in due to related parties in our condensed consolidated balance sheets.
HU Merchandising, LLC, a subsidiary of Hot Topic, is one of our suppliers. During the three-month period ended August 3, 2024, cost of goods sold related to the sale of merchandise purchased from this supplier was not material, and during the six-month period ended August 3, 2024, cost of goods sold included $0.2 million related to the sale of merchandise purchased from this supplier. During the three- and six-month periods ended July 29, 2023, cost of goods sold included $0.2 million in both periods, related to the sale of merchandise purchased from this supplier. As of the end of the second quarter of fiscal year 2024, there was no amount due to HU Merchandising, LLC, and as of the end of fiscal year 2023, the amount due to HU Merchandising, LLC was not material.