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16. Subsequent Events | 12 Months Ended
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Dec. 31, 2020
Subsequent Events [Abstract] |
Subsequent Events | Link Staffing Acquisition On February 12, 2021, HQ Link Corporation (“HQ Link”), our wholly-owned subsidiary, entered into a definitive Asset Purchase Agreement (the “Link Agreement”) with Link Staffing Services Corporation, Franlink, Inc., and Stafflink, Inc. Pursuant to the Link Agreement, HQ Link will acquire sellers’ franchise relationships and certain other assets and will assume certain liabilities of the sellers for a purchase price of approximately $11.1 million. Consummation of the transactions contemplated by the Link Agreement is subject to the satisfaction or waiver of customary closing conditions. The transaction will be financed with cash-on-hand and HireQuest, Inc.’s credit facility with Truist Bank and is not subject to any financing condition. Subject to the satisfaction or waiver of the conditions, the closing is expected to occur by March 31, 2021. The Link Agreement contains customary representations, warranties, covenants, and termination rights. Upon signing, HQ Link placed $1.5 million in escrow which will be credited against the purchase price at closing or paid to the sellers if terminate pursuant to certain provisions. The parties have agreed to customary indemnification rights subject to certain deductibles and caps. Snelling Staffing Acquisition On March 1, 2021, we completed our acquisition of certain assets of Snelling Staffing in accordance with the terms of the Asset Purchase Agreement dated January 29, 2021 (the “Snelling Agreement”). Snelling Staffing is a 67-year-old staffing company headquartered in Richardson, TX. Pursuant to the Snelling Agreement, HQ Snelling Corporation (“HQ Snelling”), our wholly-owned subsidiary, acquired substantially all of the operating assets and assumed certain liabilities of the sellers for a purchase price of $17.3 million, subject to customary adjustments for net working capital plus further adjustment in an amount equal to the collateral released to the sellers by their workers' compensation insurer which Hire Quest, LLC will replace with the insurer. Also on March 1, 2021, HQ Snelling entered into the First Amendment to the Purchase Agreement, pursuant to which HireQuest, Inc. agreed to advance $2.1 million to be paid to the sellers at closing to be used to pay accrued payroll liabilities that HQ Snelling assumed pursuant to the Snelling Agreement. We funded this acquisition with existing cash on hand and a draw on our existing line of credit with Truist. Note Purchase Agreement On March 1, 2021, HQ Financial Corporation (“HQ Financial”), a wholly-owned subsidiary of HireQuest, Inc., entered into a definitive note purchase agreement (the “Note Purchase Agreement”) with Bass Underwriters, Inc. (“Bass”), whereby HQ Financial sold and conveyed existing notes receivable due from franchisees to Bass for their current principal value of approximately $5.3 million. Bass is a related party to HireQuest, Inc., owned in part by Richard Hermanns, Edward Jackson, and trusts they have established. The transaction was reviewed and approved unanimously by all of the disinterested members of the board of directors of HireQuest, Inc. The Note Purchase Agreement provides that Bass will have no recourse against HQ Financial in the event of a default under any of the notes subject to the agreement.

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- Definition The entire disclosure for significant events or transactions that occurred after the balance sheet date through the date the financial statements were issued or the date the financial statements were available to be issued. Examples include: the sale of a capital stock issue, purchase of a business, settlement of litigation, catastrophic loss, significant foreign exchange rate changes, loans to insiders or affiliates, and transactions not in the ordinary course of business. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 855 -URI http://asc.fasb.org/topic&trid=2122774 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 855 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6842918&loc=SL6314017-165662 + Details
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