Each Board Observer’s status as a board observer will not amend, alter, or otherwise change the composition of our board of directors, the terms of current directors elected by our stockholders, or the members of any committee of our board of directors.
C&S Wholesale Grocers, Inc. (“C&S”)
Our founder, Chair, President and CEO, Richard Cohen, also serves as the executive chairman of C&S; and he and trusts for the benefit of his family are the substantial majority stockholders of that company. As a result, C&S can be considered our affiliate. In addition, our Chief Strategy Officer, William Boyd III, also serves as executive vice president and chief legal officer of C&S, our Chief Human Resources Officer, Miriam Ort, also serves as chief human resources officer of C&S, and Todd Krasnow, one of our directors, is a member of the C&S advisory board.
Customer Contracts
C&S is also an important customer that has systems that are operational (defined as achieving acceptance) in its facilities. We provide ongoing software maintenance and support and operation services under our contracts with C&S through October 2029. Revenue of $12.2 million, $58.9 million, and $15.8 million was recognized for the years ended September 27, 2025, September 28, 2024, and September 30, 2023, respectively, relating to these customer contracts. There was $2.4 million unbilled accounts receivable and accounts receivable due from C&S at September 27, 2025 and $18.4 million unbilled accounts receivable and accounts receivable due from C&S at September 28, 2024. There was $0.5 million and $1.8 million of deferred revenue relating to contracts with C&S at September 27, 2025 and September 28, 2024, respectively.
Shared Services
We currently utilize certain shared services with C&S in the operation of our business. A number of these services, including security systems and certain other arrangements (including other support services), are pursuant to unwritten arrangements with C&S.
Aircraft Time-Sharing Agreement
In certain instances, our business requires our executives to use privately owned aircraft in furtherance of our business. In December 2021 and May 2022, we entered into aircraft time-sharing agreements with C&S with respect to private aircraft owned by them, whereby our executives may utilize two C&S aircraft on an as-needed and as-available basis, with no minimum usage being required. Pursuant to the agreements, beginning in January 2022, we reimburse C&S for certain costs consistent with Federal Aviation Administration regulations for the flights by our executives on the aircraft pursuant to the time-sharing agreements.
For the fiscal years ended September 27, 2025, September 28, 2024 and September 30, 2023, we paid $1.3 million, $1.1 million and $0.9 million, respectively, to C&S pursuant to these agreements. All flights by our executives on the aircraft pursuant to the time-sharing agreement are for business purposes.
Usage of Facility and Employee Services
We have a license arrangement with C&S whereby C&S is providing receiving and logistics services for us within a C&S distribution facility. The arrangement also provides for C&S employees assisting with certain of our operations. We incurred $1.4 million, $1.8 million and $2.9 million of expense related to this arrangement for the fiscal years ended September 27, 2025, September 28, 2024 and September 30, 2023, respectively.
Operating Lease Agreements
In the fiscal year ended September 27, 2025, we entered into lease agreements with C&S for the lease of warehouse space in Plant City, FL and Coppell, TX. Our estimated lease term for these lease agreements is two years. Combined, we recognized $0.3 million in rent expense for the fiscal year ended September 27, 2025.