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Note 15 - Certain Relationships and Related Transactions
3 Months Ended
Mar. 31, 2021
Notes to Financial Statements  
Related Party Transactions Disclosure [Text Block]
Note
15.
Certain Relationships and Related Transactions
 
AWMS Holdings, LLC
 
In
August 2013,
Avalon created a new Ohio limited liability company, AWMS Holdings, LLC, to act as a holding company to form and own a series of wholly owned subsidiaries that will own and operate Class II salt water injection wells and facilities (together the “facilities”). AWMS Holdings, LLC, offers investment opportunities to accredited investors by selling membership units of AWMS Holdings, LLC through private placement offerings. The monies received from these offerings, along with internally contributed capital, are used to construct the facilities necessary for the operation of salt water injection wells. AWMS Water Solutions, LLC, a wholly owned subsidiary of Avalon, manages all the salt water injection well operations, including the marketing and sales function and all decisions regarding the well operations for a percentage of the gross revenues.
 
In
2014
and
2013,
Avalon, through a wholly owned subsidiary made capital contributions totaling approximately
$3.4
million, which included cash and certain well assets, including the permits, in exchange for membership units of AWMS Holdings, LLC. Through a private placement offering for the purchase of membership units, AWMS Holdings, LLC raised approximately
$3.8
million from accredited investors in
2014
and
2013.
Management and outside directors of Avalon, who qualified as accredited investors, invested approximately
$1.0
million in AWMS Holdings, LLC.
 
As a result of a private placement offering, Avalon is
not
the majority owner of AWMS Holdings, LLC. At
March 31, 2021
and
December 31, 2020,
respectively, Avalon owns approximately
47%
of AWMS Holdings, LLC. In accordance with ASC
810
-
10
and related amendment
,
due to the managerial control of American Water Solutions, LLC, AWMS Holdings, LLC is a variable interest entity, and the financial statements of AWMS Holdings, LLC and subsidiaries are included in Avalon's consolidated financial statements. ASC
810
-
10
requires noncontrolling interests to be reported as a separate component of equity. The amount of net loss attributable to the noncontrolling interest is recorded in “net loss attributable to noncontrolling interest” in our Condensed Consolidated Statements of Operations.
 
Avalon Med Spa, LLC
 
In
March 2021,
Avalon created a new Ohio limited liability company, Avalon Med Spa, LLC. Avalon Med Spa, LLC will provide elective appearance improving nonsurgical aesthetic services under the supervision of a licensed physician. Avalon Med Spa, LLC, offers investment opportunities to accredited investors by selling membership units through private placement offerings. The monies received from these offerings, along with internally contributed capital, will be used to purchase medical spa equipment and construct the facilities necessary for operation. Avalon will manage all decisions regarding the medical spa operations for a percentage of the gross revenues.
 
In
March 2021,
Avalon made a capital contribution of approximately
$0.5
million, which included cash and certain equipment, in exchange for membership units of Avalon Med Spa, LLC. At
March 31, 2021,
Avalon owns
100%
of Avalon Med Spa, LLC. Avalon Med Spa, LLC was
not
in operation at
March 31, 2021.
The operating results will be included in Avalon's golf and related operations segment.