Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Mar. 25, 2015 | Jun. 30, 2014 | |
Document And Entity Information [Abstract] | |||
Entity Registrant Name | Chanticleer Holdings, Inc. | ||
Entity Central Index Key | 1106838 | ||
Document Type | 10-K | ||
Current Fiscal Year End Date | -19 | ||
Amendment Flag | FALSE | ||
Document Period End Date | 31-Dec-14 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filer | No | ||
Entity's Reporting Status Current | Yes | ||
Entity Public Float | $11,671,851 | ||
Entity Common Stock, Shares Outstanding | 12,306,230 | ||
Entity Filer Category | Smaller Reporting Company | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2014 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Current assets: | ||
Cash | $245,828 | $442,694 |
Accounts and other receivables | 276,734 | 227,181 |
Other receivable | 36,775 | 50,380 |
Inventories | 532,803 | 381,408 |
Due from related parties | 46,015 | 116,305 |
Prepaid expenses and other current assets | 330,745 | 495,165 |
TOTAL CURRENT ASSETS | 1,468,900 | 1,713,133 |
Property and equipment, net | 13,315,409 | 5,620,189 |
Goodwill | 15,617,308 | 6,496,756 |
Intangible assets, net | 3,396,503 | 3,424,632 |
Investments at fair value | 35,362 | 55,112 |
Other investments | 1,550,000 | 2,491,963 |
Deposits and other assets | 408,492 | 285,821 |
TOTAL ASSETS | 35,791,974 | 20,087,606 |
Current liabilities: | ||
Current maturities of long-term debt and notes payable | 1,813,647 | 835,454 |
Current maturities of convertible notes payable, net of debt discount of $63,730 and $0, respectively | 436,270 | |
Derivative liability | 1,945,200 | 2,146,000 |
Accounts payable and accrued expenses | 5,580,131 | 2,423,661 |
Current maturities of capital leases payable | 42,032 | 59,162 |
Deferred rent | 118,986 | 53,303 |
Due to related parties | 1,299,083 | 12,191 |
Liabilities of discontinued operations | 177,393 | 1,500 |
TOTAL CURRENT LIABILITIES | 11,412,742 | 5,531,271 |
Convertible notes payable, net of debt discount of $1,872,587 and $2,583,333, respectively | 1,477,413 | 416,667 |
Capital leases payable, less current maturities | 36,628 | 105,918 |
Deferred rent | 2,196,523 | 1,055,138 |
Deferred tax liabilities | 686,884 | 1,340,712 |
Long-term debt, less current maturities, net of debt discount of $343,733 and $0, respectively | 5,009,283 | 398,906 |
TOTAL LIABILITIES | 20,819,473 | 8,848,612 |
Commitments and contingencies (Note 17) | ||
Stockholders' equity: | ||
Common stock: $0.0001 par value; authorized 45,000,000 shares; issued and outstanding 7,249,442 and 5,387,897 shares at December 31, 2014 and 2013, respectively | 725 | 539 |
Additional paid in capital | 32,601,400 | 25,404,994 |
Accumulated other comprehensive loss | -1,657,908 | -88,368 |
Non-controlling interest | 4,904,471 | 394,645 |
Accumulated deficit | -20,876,187 | -14,472,816 |
TOTAL STOCKHOLDERS' EQUITY | 14,972,501 | 11,238,994 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $35,791,974 | $20,087,606 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Statement Of Financial Position Parenthetical [Abstract] | ||
Debt Instrument Unamortized Discount, Current | $63,730 | $0 |
Debt Instrument Unamortized Discount, Noncurrent | 1,872,587 | 2,583,333 |
Debt Instrument Unamortized Discount | $343,733 | $0 |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares authorized | 45,000,000 | 45,000,000 |
Common stock, shares issued | 7,249,442 | 5,387,897 |
Common stock, shares outstanding | 7,249,442 | 5,387,897 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations and Comprehensive Loss (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Revenue: | ||
Restaurant sales, net | $28,745,258 | $8,144,035 |
Gaming income, net | 432,688 | |
Management fee income - non-affiliates | 665,488 | 103,452 |
Total revenue | 29,843,434 | 8,247,487 |
Expenses: | ||
Restaurant cost of sales | 9,934,532 | 3,031,457 |
Restaurant operating expenses | 17,363,743 | 4,909,580 |
Restaurant pre-opening expenses | 524,739 | 56,902 |
General and administrative expenses | 5,976,870 | 4,233,629 |
Depreciation and amortization | 1,587,858 | 622,274 |
Total expenses | 35,387,742 | 12,853,842 |
Loss from operations | -5,544,308 | -4,606,355 |
Other income (expense) | ||
Equity in losses of investments | -40,694 | -125,017 |
Interest and other income | 334,477 | 82,411 |
Interest expense | -2,280,921 | -757,733 |
Realized gains on securities | 101,472 | |
Change in fair value of derivative liabilities | -200,800 | -119,600 |
Total other expense | -658,066 | -680,739 |
Loss from continuing operations before income taxes | -6,202,374 | -5,287,094 |
(Benefit) Provision for income taxes | -476,501 | 40,935 |
Loss from continuing operations | -5,725,873 | -5,328,029 |
Loss from discontinued operations, net of taxes | -920,960 | -25,215 |
Consolidated net loss | -6,646,833 | -5,353,244 |
Less: Net loss attributable to non-controlling interest | 243,462 | 139,125 |
Net loss attributable to Chanticleer Holdings, Inc. | -6,403,371 | -5,214,119 |
Net loss attributable to Chanticleer Holdings, Inc.: | ||
Loss from continuing operations | -5,482,411 | -5,188,904 |
Loss from discontinued operations | -920,960 | -25,215 |
Net loss attributable to Chanticleer Holdings, Inc. | -6,403,371 | -5,214,119 |
Other comprehensive loss: | ||
Unrealized (loss) gain on available-for-sale securities (none applies to non-controlling interest) | -223,746 | 3,984 |
Foreign currency translation (loss) gain | -1,345,793 | 90,384 |
Other comprehensive loss | ($7,972,910) | ($5,119,751) |
Net loss attributable to Chanticleer Holdings, Inc. per common share, basic and diluted: | ||
Continuing operations attributable to common shareholders, basic and diluted | ($0.87) | ($1.19) |
Discontinued operations attributable to common shareholders, basic and diluted | ($0.15) | ($0.01) |
Weighted average shares outstanding | 6,332,843 | 4,365,468 |
Consolidated_Statements_of_Sto
Consolidated Statements of Stockholders' Equity (USD $) | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Other Comprehensive Loss [Member] | Noncontrolling Interest [Member] | Accumulated Deficit [Member] | Total |
Balance at Dec. 31, 2012 | $370 | $14,898,423 | ($181,741) | $70,198 | ($9,258,697) | $5,528,553 |
Balance, shares at Dec. 31, 2012 | 3,698,896 | |||||
Common stock issued for Services | 12 | 569,976 | 569,988 | |||
Common stock issued for Services, shares | 122,334 | |||||
Purchase of American Roadside Burgers, Inc | 74 | 3,611,052 | 3,611,126 | |||
Purchase of American Roadside Burgers, Inc, shares | 740,000 | |||||
Cash, net of expenses | 83 | 3,073,314 | 3,073,397 | |||
Cash, net of expenses, shares | 826,667 | |||||
Fair value of warrants issued for purchase of American Roadside Burgers, Inc. | 1,710,077 | 1,710,077 | ||||
Warrants issued with convertible debt | 884,600 | 884,600 | ||||
Unrealized loss on available for sale securities | -1,837 | -1,837 | ||||
Warrants issued for consulting services | 657,552 | 657,552 | ||||
Foreign translation gain | 95,210 | 95,210 | ||||
Purchase of Just Fresh | 463,572 | 463,572 | ||||
Common stock and warrants issued for Cash proceeds, net | -139,125 | -5,214,119 | -5,353,244 | |||
Amortization of warrants | ||||||
Net loss | -139,125 | -5,214,119 | -5,353,244 | |||
Balance at Dec. 31, 2013 | 541 | 25,404,994 | -88,368 | 394,645 | -14,472,816 | 11,238,994 |
Balance, shares at Dec. 31, 2013 | 5,387,897 | |||||
Warrants issued with convertible debt | 70,969 | 70,969 | ||||
Foreign translation gain | -1,345,794 | -1,345,794 | ||||
Common stock and warrants issued for Cash proceeds, net | 47 | 857,155 | 857,202 | |||
Common stock and warrants issued for Cash proceeds, net, shares | 469,101 | |||||
Common stock and warrants issued for Business combinations | 102 | 5,401,639 | 4,753,288 | 10,155,029 | ||
Common stock and warrants issued for Business combinations, shares | 1,021,900 | |||||
Common stock and warrants issued for Interest | 16 | 161,798 | 161,814 | |||
Common stock and warrants issued for Interest, shares | 155,307 | |||||
Common stock and warrants issued for Consulting services | 23 | 711,868 | 711,868 | |||
Common stock and warrants issued for Consulting services, shares | 225,465 | |||||
Common stock and warrants issued for Warrant exercise | 17 | 349,527 | 349,544 | |||
Common stock and warrants issued for Warrant exercise, shares | 174,772 | |||||
Repurchase of shares and warrants | -19 | -446,050 | -446,069 | |||
Repurchase of shares and warrants | -185,000 | |||||
Amortization of warrants | 89,500 | 89,500 | ||||
Available-for-sale securities | -223,746 | -223,746 | ||||
Net loss | -243,462 | -6,403,371 | -6,646,833 | |||
Balance at Dec. 31, 2014 | $725 | $32,601,400 | ($1,657,908) | $4,904,471 | ($20,876,187) | $14,972,501 |
Balance, shares at Dec. 31, 2014 | 7,249,442 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Cash flows from operating activities: | ||
Net loss | ($6,646,833) | ($5,353,244) |
Net loss from discontinued operations | 920,960 | 25,215 |
Net loss from continuing operations | -5,725,873 | -5,328,029 |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 1,587,858 | 622,274 |
Equity in losses of investments | 40,694 | 125,017 |
Common stock issued for services | 711,891 | 569,990 |
Gain on sale of investments | -101,472 | |
Amortization of debt discount | 1,400,392 | 566,867 |
Amortization of warrants | 89,500 | |
Common stock and warrants issued for interest | 161,814 | 486,272 |
Warrants issued in connection with convertible debt | 70,969 | |
Change in the fair value of derivative liabilities | -200,800 | -119,600 |
Gain on debt extinguishment | -70,900 | |
Increase in amounts due to affiliates | 1,427,183 | 52 |
(Increase) decrease in accounts receivable | -49,553 | 7,455 |
Increase in other receivable | 179,919 | |
Decrease (increase) in prepaid expenses and other assets | 120,456 | -165,356 |
Increase in inventory | 485,499 | 5,966 |
(Decrease) increase in accounts payable and accrued expenses | -368,475 | 383,291 |
Deferred income taxes | -653,828 | |
Net cash used in operating activities from continuing operations | -1,003,745 | -2,736,782 |
Net cash (used in) provided by operating activities from discontinued operations | -23,195 | 32,583 |
Net cash used in operating activities | -1,026,940 | -2,704,199 |
Cash flows from investing activities: | ||
Purchase of property and equipment | -1,970,173 | -3,658,224 |
Cash paid for acquisitions, net of cash acquired | -322,473 | 243,991 |
Proceeds from sale of investments | 121,222 | 99,934 |
Purchase of investments | -674,084 | |
Franchise costs | -76,822 | |
Net cash used in investing activities from continuing operations | -2,171,424 | -4,065,205 |
Net cash used in investing activities from discontinued operations | ||
Net cash used in investing activities | -2,171,424 | -4,065,205 |
Cash flows from financing activities: | ||
Proceeds from sale of common stock and warrants | 1,206,746 | 3,073,397 |
Loan proceeds | 2,072,951 | 3,622,000 |
Loan repayments | -202,456 | -756,299 |
Capital lease payments | -47,602 | -45,356 |
Net cash provided by financing activities from continuing operations | 3,029,639 | 5,893,742 |
Net cash provided by financing activities from discontinued operations | ||
Net cash provided by financing activities | 3,029,639 | 5,893,742 |
Effect of exchange rate changes on cash | -28,141 | 94,553 |
Net decrease in cash | -196,866 | -781,109 |
Cash, beginning of year | 442,694 | 1,223,803 |
Cash, end of year | 245,828 | 442,694 |
Cash paid for interest and income taxes: | ||
Interest | 320,260 | 92,049 |
Income taxes | 45,517 | 25,928 |
Non-cash investing and financing activities: | ||
Purchase of equipment using capital leases | 121,930 | |
Debt assumed in connection with business combinations | 5,000,000 | |
Issuance of stock and warrants in connection with business combinations | 5,401,639 | |
Repurchase of shares and warrants in connection with discontinued operation | 446,069 | |
Debt discount for fair value of warrants and conversion feature issued in connection with debt | 1,026,800 | 2,115,400 |
Purchases of businesses: | ||
Current assets excluding cash | 636,894 | 475,326 |
Property and equipment | 7,945,152 | 3,263,146 |
Goodwill | 11,394,009 | 6,135,262 |
Trade name/trademarks/franchise fees | 559,304 | 2,794,443 |
Deposits and other assets | 136,025 | 98,035 |
Deferred Taxes | -1,340,000 | |
Liabilities assumed | -4,165,235 | -2,145,129 |
Non-controlling interest | -4,753,288 | -463,571 |
Chanticleer equity | -1,028,749 | |
Common stock and warrants issued | -5,401,639 | -5,321,203 |
Assumption of debt | -5,000 | |
Cash paid | -350,000 | -3,740,000 |
Cash received in excess of cash paid in acquisition | $27,527 | $243,991 |
Nature_of_Business
Nature of Business | 12 Months Ended | ||
Dec. 31, 2014 | |||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Nature of Business | 1 | Nature of Business | |
Organization | |||
Chanticleer Holdings, Inc. (the “Company”) is in the business of owning and operating fast casual dining concepts domestically and internationally. The Company was organized October 21, 1999, under its original name, Tulvine Systems, Inc., under the laws of the State of Delaware. On April 25, 2005, Tulvine Systems, Inc. formed a wholly owned subsidiary, Chanticleer Holdings, Inc., and on May 2, 2005, Tulvine Systems, Inc. merged with and changed its name to Chanticleer Holdings, Inc. | |||
The consolidated financial statements include the accounts of Chanticleer Holdings, Inc. and its subsidiaries, Chanticleer Advisors, LLC, (“Advisors”), Avenel Ventures, LLC (“Ventures”), Chanticleer Holdings Limited (“CHL”), Chanticleer Holdings Australia Pty, Ltd. (“CHA”), Chanticleer Investment Partners, LLC (“CIP”), DineOut SA Ltd. (“DineOut”), Chanticleer and Shaw Foods (Pty) Ltd. (“C&S”), Kiarabrite (Pty) Ltd (“KPL”), Hooters Port Elizabeth (Pty) Ltd.(“PE”), Dimaflo (Pty) Ltd (“DFLO”), Tundraspex (Pty) Ltd (“TPL”), Civisign (Pty) Ltd (“CPL”), Dimalogix (Pty) Ltd (“DLOG”), Pulse Time Trade (Pty) Ltd. (“PTT”), Crown Restaurants Kft. (“CRK”), American Roadside Burgers, Inc. (“ABC”), West End Wings Ltd. (“WEW”), JF Restaurants, L.L.C (“JFR”), JF Franchising Systems, L.L.C. (“JFFS”), Tacoma Wings, LLC, Jantzen Beach Wings, LLC, Oregon Owl’s Nest, LLC, Dallas Spoon, LLC, Dallas Spoon Beverage, LLC, Hoot Campbelltown Pty. Ltd., Hoot Surfers Paradise Pty. Ltd., Hoot Townsville Pty. Ltd. Hoot Parramatta Pty Ltd, Hoot Australia Pty Ltd, Hoot Penrith Pty Ltd, and TMIX Management Australia Pty Ltd (collectively referred to as the “Company”). | |||
On July 11, 2013, the names of DFLO, CPL and DLOG were changed in South Africa to Hooters Umhlanga (Pty.) Ltd., Hooters CapeTown (Pty.) Ltd., and Hooters Emperors Palace (Pty.) Ltd., respectively. On August 30, 2013, January 8, 2014, and June 4, 2014 the names of KPL, C&S and PTT were changed to Hooters SA (Pty) Ltd., Chanticleer South Africa (Pty) Ltd. and Hooters PE, respectively. | |||
On April 1, 2014, the Company increased its ownership in the Australian Hooters entities, Hoot Campbelltown Pty. Ltd., Hoot Surfers Paradise Pty. Ltd. and Hoot Townsville Pty. Ltd., from 49% to 60%. On July 1, 2014, we purchased 60% of Australian Hooters entities - Hoot Parramatta Pty Ltd, Hoot Australia Pty Ltd, Hoot Penrith Pty Ltd, and TMIX Management Australia Pty Ltd. All significant inter-company balances and transactions have been eliminated in consolidation. The accompanying consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). | |||
The Company operates on a calendar year-end. The accounts of two subsidiaries, JFR and WEW, are consolidated based on either a 52- or 53-week period ending on the Sunday closest to each December 31. No events occurred related to the difference between the Company’s reporting calendar year end and the Company’s two subsidiaries year end that materially affected the company’s financial position, results of operations, or cash flows. | |||
Information regarding the Company’s subsidiaries is as follows: | |||
● | Advisors was formed as a wholly owned Nevada limited liability company on January 18, 2007 to manage related companies, Chanticleer Investors, LLC (“Investors LLC”), and Chanticleer Investors II, LLC (“Investors II”).The Company announced its intention to exit the Investors II business on March 22, 2013, and effectuated such exit during the second quarter of fiscal 2013. | ||
● | Ventures was formed as a wholly owned Nevada limited Liability Company on December 24, 2008 to provide business management and consulting services to its clients. | ||
● | CHL was formed as a wholly owned limited liability company in Jersey on March 24, 2009 to own the Company’s initial 50% interest in Hooters SA, GP, the general partner of the Hooters restaurant franchises in South Africa. | ||
● | CHA was formed on September 30, 2011 in Australia as a wholly owned subsidiary to invest in Hooters restaurants in Australia. | ||
● | CIP was formed as a wholly owned North Carolina limited liability company on September 20, 2011. CIP was formed to manage separate and customized investment accounts for investors. The Company registered CIP as a registered investment advisor with the state of North Carolina. The Company exited this business during the second quarter of 2013. | ||
● | DineOut was formed as a private limited liability company in England and Wales on October 29, 2009 to raise capital in Europe for Hooters South African stores. The Company owns approximately 89% of DineOut at December 31, 2014 and 2013. | ||
● | Consolidated entities domiciled in South Africa include: | ||
● | Hooters SA (Pty) Ltd. was formed on August 30, 2011 to manage the Hooters restaurants in South Africa. The Company owns 80% and local management owns 20% at December 31, 2014 and 2013. | ||
● | Chanticleer South Africa (Pty) Ltd. was formed in 2009 and is owned 100% by the Company at December 31, 2014 and 2013, and holds the Hooters of America (“HOA”) franchise rights in South Africa. | ||
● | Hooters Umhlanga (Pty) Ltd. was formed on August 16, 2011 and is owned 82% by the Company and 18% by outside investors at December 31, 2014 and 2013. DFLO owns the Hooters restaurant in Durban, South Africa. | ||
● | TPL was formed on August 18, 2011 and is owned 88% by the Company and 12% by outside investors at December 31, 2014 and 2013. TPL owns the Hooters restaurant in Johannesburg, South Africa. | ||
● | PTT was formed on October 23, 2013 and is owned 100% by the Company at December 31, 2014 and 2013. PTT owns the Hooters restaurant in Pretoria, South Africa. | ||
● | Hooters CapeTown (Pty) Ltd. was formed on August 29, 2011 and is owned 90% by the Company and 10% by outside investors at December 31, 2014 and 2013. CPL owns the Hooters restaurant in Cape Town, South Africa. The restaurant relocated from Cape Town to Johannesburg in December 2014. On June 11, 2014, the name of Hooters CapeTown (Pty.) Ltd. was changed to Hooters Ruimsig (Pty) Ltd. | ||
● | Hooters Emperors Palace (Pty) Ltd. was formed on August 27, 2011 and is owned 88% by the Company and 12% by outside investors at December 31, 2014 and 2013. Hooters Emperors Palace (Pty) Ltd owns the Hooters restaurant in the Emperor’s Palace resort in Johannesburg, South Africa | ||
. | |||
● | CRK was formed on October 12, 2011 in Hungary and is owned 80% by the Company and 20% by a local investor at December 31, 2014 and 2013. CRK’s business purpose is owning and operating restaurants in Hungary (including the Budapest, Hungary location which opened in August 2012) and Poland (the Company has not opened a restaurant in Poland as of the date of this report). | ||
● | ABC, a Delaware corporation, was acquired on September 20, 2013 in a transaction between ABC and Chanticleer Roadside Burgers International, L.L.C., a single member limited liability company with Chanticleer as its sole member. It is owned 100% by Chanticleer at December 31, 2014 and 2013 and owns the ABC restaurant franchise. | ||
● | WEW, a United Kingdom entity, was acquired on November 6, 2013. It is 100% owned by the Company at December 31, 2014 and 2013 and owns the Hooters restaurant in Nottingham, England. | ||
● | JFR and JFFS, both North Carolina limited liability companies, were acquired on December 10, 2013. These entities are 56% owned by the Company and 44% owned by various investors and owns the Just Fresh restaurant franchise. | ||
● | On January 31, 2014, we acquired all of the outstanding shares of each of Tacoma Wings, LLC, Jantzen Beach Wings, LLC and Oregon Owl’s Nest, LLC (“Pacific NW”). Tacoma Wings, LLC and Jantzen Beach Wings, LLC own and operate the Hooters restaurant locations in Tacoma, Washington and Portland, Oregon, respectively. Oregon Owl’s Nest, LLC operates gaming machines in Portland , Oregon under license from the Oregon Lottery Commission. | ||
● | Also on January 31, 2014, we completed the acquisition of all of the outstanding shares of Dallas Spoon, LLC and Dallas Spoon Beverage, LLC from Express Restaurant Holdings, LLC and Express Restaurant Holdings Beverage, LLC (“Spoon”). | ||
● | Effective April 1, 2014, we completed the step acquisition of a 60% controlling interest in our Hooters Australia joint venture resulting in the consolidation of these entities, Hoot Cambelltown Pty. Ltd., Hoot Surfers Paradise Pty. Ltd. and Hoot Townsville Pty. Ltd. On July 1, 2014, the Company purchased 60% of the following additional Hooters Australia entities, Hoot Parramatta Pty Ltd, Hoot Australia Pty Ltd, Hoot Penrith Pty Ltd, and TMIX Management Australia Pty Ltd. The consolidated financial statements include the accounts of the Australian entities from the date the company acquired control. | ||
Information regarding the Company’s unconsolidated affiliates is as follows: | |||
● | Investors LLC is a limited liability company formed in 2006 through which the Company raised $5,000,000 and began its relationship with Hooters of America, Inc. (“HOA”). Initially structured as a loan transaction, the loan was repaid in early 2011 and $3,550,000 was invested in HOA Holdings, LLC (“HOA LLC”). HOA LLC acquired HOA and Texas Wings, Inc. (“TW”) in early 2011. Investors LLC owns approximately 3.0% of HOA LLC and the Company owns approximately 22% of Investors LLC. | ||
● | Chanticleer Dividend Fund, Inc. (“CDF”) was formed on November 10, 2010 in Maryland. CDF filed a registration statement in January 2011 under Form N-2 with plans to register as a non-diversified, closed-end investment company. During 2014, management reviewed the operations of CDF. CDF intends to dissolve the entity in 2015. | ||
● | Chanticleer Foundation, Inc. (“CF”) is a non-profit organization formed for charitable purposes. CF is controlled by its board, which consists of Mr. Pruitt, a director of the Company and an employee of the Company. | ||
LIQUIDITY AND CAPITAL RESOURCES | |||
As of December 31, 2014, our cash balance was $245,828 and cash used in operations for the year ended December 31, 2014 was approximately $1 million. As of March 31, 2015, our cash balance was approximately $3.2 million. The level of additional cash needed to fund operations and our ability to conduct business for the next twelve months will be influenced primarily by the following factors: | |||
● | the pace of growth in our restaurant businesses and related investments in opening new stores; | ||
● | the level of investment in acquisition of new restaurant businesses and entering new markets; | ||
● | our ability to manage our operating expenses and maintain gross margins as we grow: | ||
● | our ability to access the capital and debt markets; | ||
● | popularity of and demand for our fast casual dining concepts; and | ||
● | general economic conditions and changes in consumer discretionary income. | ||
We have typically funded our operating costs, acquisition activities, working capital investments and capital expenditures with proceeds from the issuances of our common stock and other financing arrangements, including convertible debt, lines of credit, notes payable and capital leases. | |||
In addition, our business is subject to additional risks and uncertainties, including, but not limited to, those described in Item 1A. “Risk Factors.” | |||
Our operating plans for 2015 contemplate moderate organic growth, opening 3-4 new stores within our current markets and restaurant concepts, as well as growing through the acquisition of additional restaurant businesses to expand our market scale. We completed a rights offering in March 2015 generating gross proceeds of approximately $7.8 million and issued convertible debt and received another $2.2 million to fund the acquisition of The Burger Joint and for general corporate purposes. Also, in 2015 we closed on the acquisition of BGR The Burger Joint for a purchase price of $4,000,000 in cash and 500,000 shares of the company’s common stock. The acquisition has nine company owned stores and eleven franchise locations. | |||
We are also in negotiations to extend and increase our $500,000 line of credit currently due May 2015, extend payment terms of our $5 million debt to defer payments until 2016, and are in discussion with an existing shareholder regarding an equity raise between $1-3 million. In January, a note holder converted to equity $500,000 of a note that was payable in less than a year. | |||
As we execute our growth plans throughout the balance of 2015, we intend to carefully monitor the impact of growth on our working capital needs and cash balances relative to the availability of cost-effective debt and equity financing. We believe the capital resources available to us will be sufficient to fund our ongoing operations and to support our operating plans through December 31, 2015. We may raise additional capital from the issuance of new debt and equity during 2015 to continue to execute our growth plans, although there can be no assurance that we will be able to do so. In the event that such capital is not available, we may have to scale back or freeze our store opening plans, reduce general and administrative expenses and/or curtail future acquisition plans to manage our liquidity and capital resources. |
Significant_Accounting_Policie
Significant Accounting Policies | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Accounting Policies [Abstract] | |||||||||
Significant Accounting Policies | 2 | SIGNIFICANT ACCOUNTING POLICIES | |||||||
Use of Estimates | |||||||||
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Significant estimates include the valuation of the investments in portfolio companies, deferred tax asset valuation allowances, valuing options and warrants using the Binomial Lattice and Black Scholes models, intangible asset valuations and useful lives, depreciation and uncollectible accounts and reserves . Actual results could differ from those estimates. | |||||||||
revenue recognition | |||||||||
Revenue is recognized when all of the following criteria have been satisfied: | |||||||||
● | Persuasive evidence of an arrangement exists; | ||||||||
● | Delivery has occurred or services have been rendered; | ||||||||
● | The seller’s price to the buyer is fixed or determinable; and | ||||||||
● | Collectability is reasonably assured. | ||||||||
Restaurant Net Sales and Food and Beverage Costs | |||||||||
The Company records revenue from restaurant sales at the time of sale, net of discounts, coupons, employee meals, and complimentary meals and gift cards. Sales, value added (“VAT”) and goods and services tax (“GST”) collected from customers and remitted to governmental authorities are presented on a net basis within sales in our consolidated statements of operations. Cost of sales primarily includes the cost of food, beverages, and merchandise and disposable paper and plastic goods used in preparing and selling our menu items, and exclude depreciation and amortization. Vendor allowances received in connection with the purchase of a vendor’s products are recognized as a reduction of the related food and beverage costs as earned | |||||||||
Management Fee Income | |||||||||
The Company receives revenue from management fees from certain non-affiliated companies, including HOA. | |||||||||
Gaming Income | |||||||||
The Company receives revenue from operating a gaming facility adjacent to its Hooters restaurant in Jantzen Beach, Oregon. The Company also receives gaming revenue from gaming machines located in Sydney Australia, which continues until the $5 million of debt assumed connection with the acquisition of the Hooters franchise stores in Australia is repaid. After that debt has been repaid, our participation in the gaming revenue at the Sydney location will decrease from 100% to 60%. Revenue is recognized as earned from gaming activities, net of taxes and other government fees. | |||||||||
Business combinations | |||||||||
For business combinations, the assets acquired, the liabilities assumed, and any non-controlling interest are recognized at the acquisition date, measured at their fair values as of that date. In a business combination achieved in stages, the identifiable assets and liabilities, as well as the non-controlling interest in the acquiree, are recognized at the full amounts of their fair values. In a bargain purchase in which the total acquisition-date fair value of the identifiable net assets acquired exceeds the fair value of the consideration transferred plus any non-controlling interest in the acquire, that excess in earnings was recognized as a gain attributable to the Company. | |||||||||
Long-lived Assets | |||||||||
The Company accounts for our long-lived assets in accordance with Accounting Standards Codification (“ASC”) 360, “Accounting for the Impairment or Disposal of Long-Lived Assets” (“ASC 360”), which requires that long-lived assets be evaluated whenever events or changes in circumstances indicate that the carrying amount may not be recoverable or the useful life has changed. Some of the events or changes in circumstances that would trigger an impairment test include, but are not limited to; | |||||||||
● | significant under-performance relative to expected and/or historical results (negative comparable sales growth or operating cash flows for two consecutive years); | ||||||||
● | significant negative industry or economic trends; | ||||||||
● | knowledge of transactions involving the sale of similar property at amounts below the company’s carrying value; or | ||||||||
● | the company’s expectation to dispose of long-lived assets before the end of their estimated useful lives, even though the assets do not meet the criteria to be classified as “held for sale.” | ||||||||
Long-lived assets are grouped for recognition and measurement of impairment at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets. The impairment test for long-lived assets requires us to assess the recoverability of our long-lived assets by comparing their net carrying value to the sum of undiscounted estimated future cash flows directly associated with and arising from the company’s use and eventual disposition of the assets. If the net carrying value of a group of long-lived assets exceeds the sum of related undiscounted estimated future cash flows, the Company would be required to record an impairment charge equal to the excess, if any, of net carrying value over fair value. | |||||||||
When assessing the recoverability of our long-lived assets, which include property and equipment and finite-lived intangible assets, the company makes assumptions regarding estimated future cash flows and other factors. Some of these assumptions involve a high degree of judgment and also bear a significant impact on the assessment conclusions. Included among these assumptions are estimating undiscounted future cash flows, including the projection of comparable sales, operating expenses, capital requirements for maintaining property and equipment and residual value of asset groups. The Company formulates estimates from historical experience and assumptions of future performance, based on business plans and forecasts, recent economic and business trends, and competitive conditions. In the event that our estimates or related assumptions change in the future, the company may be required to record an impairment charge. | |||||||||
The Company evaluates the remaining useful lives of long-lived assets and identifiable intangible assets whenever events or circumstances indicate that a revision to the remaining period of amortization is warranted. Such events or circumstances may include (but are not limited to): the effects of obsolescence, demand, competition, and/or other economic factors including the stability of the industry in which the Company operates, known technological advances, legislative actions, or changes in the regulatory environment. If the estimated remaining useful lives change, the remaining carrying amount of the long-lived assets and identifiable intangible assets would be amortized prospectively over that revised remaining useful life. | |||||||||
RESTAURANT PRE-OPENING EXPENSES | |||||||||
Restaurant pre-opening expenses are non-capital expenditures, which are expensed as incurred, consist of the costs of hiring and training the initial hourly work force for each new restaurant, travel, the cost of food and supplies used in training, grand opening promotional costs, the cost of the initial stocking of operating supplies and other direct costs related to the opening of a restaurant, including rent during the construction and in-restaurant training period. Pre-opening expenses are expensed as incurred. | |||||||||
LIQUOR LICENSES | |||||||||
The costs of obtaining non-transferable liquor licenses that are directly issued by local government agencies for nominal fees are expensed as incurred. The costs of purchasing transferable liquor licenses through open markets in jurisdictions with a limited number of authorized liquor licenses are capitalized as indefinite-lived intangible assets and included in other assets. Liquor licenses are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Annual liquor license renewal fees are expensed over the renewal term. | |||||||||
ACCOUNTS AND OTHER RECEIVABLES | |||||||||
The Company monitors its exposure for credit losses on its receivable balances and the credit worthiness of its receivables on an ongoing basis and records related allowances for doubtful accounts. Allowances are estimated based upon specific customer and other balances, where a risk of default has been identified, and also include a provision for non-customer specific defaults based upon historical experience. The majority of the Company’s accounts are from customer credit card transactions with minimal historical credit risk. As of December 31, 2014 and 2013, the Company has not recorded an allowance for doubtful accounts. If circumstances related to specific customers change, estimates of the recoverability of receivables could also change. | |||||||||
INVENTORIES | |||||||||
Inventories are recorded at the lower of cost (first-in, first-out method) or market, and consist primarily of restaurant food items, supplies, beverages and merchandise. | |||||||||
LEASES | |||||||||
The Company leases certain property under operating leases. The Company also finances certain property using capital leases, with the asset and obligation recorded at an amount equal to the present value of the minimum lease payments during the lease term. | |||||||||
Many of these lease agreements contain rent holidays, rent escalation clauses and/or contingent rent provisions. Rent expense is recognized on a straight-line basis over the expected lease term, including cancelable option periods when failure to exercise such options would result in an economic penalty. The Company also may receive tenant improvement allowances in connection with its leases which are capitalized as leasehold improvements with a corresponding liability recorded in the deferred occupancy liability line in the consolidated balance sheet. The tenant improvement allowance liability is amortized on a straight-line basis over the lease term. The rent commencement date of the lease term is the earlier of the date when the Company becomes legally obligated for the rent payments or the date when the Company takes access to the property or the grounds for build out. Certain leases contain percentage rent provisions where additional rent may become due if the location exceeds certain sales thresholds. The Company recognizes expense related to percentage rent obligations at such time as it becomes probable that the percent rent threshold will be met. | |||||||||
MARKETABLE EQUITY SECURITIES | |||||||||
Available-for-sale securities | |||||||||
The Company’s investments in marketable equity securities which are classified as available-for-sale are carried at fair value. Investments available for current operations are classified in the consolidated balance sheets as current assets; investments held for long-term purposes are classified as non-current assets. Unrealized gains and losses, net of tax, are reported in other comprehensive income as a separate component of stockholders’ equity. Gains and losses are reported in the consolidated statements of operations when realized, determined based on the disposition of specifically identified investments, using a first-in, first-out method. | |||||||||
Investments identified by the Company as being potentially impaired are subject to further analysis to determine if the impairment is other than temporary. Other than temporary declines in market value from original costs are charged to investment and other income, net, in the period in which the loss occurs. In determining whether investment holdings are other than temporarily impaired, the Company considers the nature, cause, severity and duration of the impairment. | |||||||||
OTHER INVESTMENTS | |||||||||
Investments in which the Company has the ability to exercise significant influence and that, in general, are at least 20 percent owned are stated at cost plus equity in undistributed net earnings (loss), less distributions received. The Company also has equity investments in which it owns less than 20% which are stated at cost. An impairment loss would be recorded whenever a decline in the value of an equity investment or cost investment is below its carrying amount and is determined to be other than temporary. In judging “other than temporary,” the Company considers the length of time and extent to which the fair value of the investment has been less than the carrying amount of the investment, the near-term and long-term operating and financial prospects of the investee, and the Company’s long-term intent of retaining the investment in the investee. | |||||||||
FAIR VALUE MEASUREMENTS | |||||||||
For financial assets and liabilities measured at fair value on a recurring basis, fair value is the price we would receive to sell an asset or pay to transfer a liability in an orderly transaction with a market participant at the measurement date. In the absence of active markets for the identical assets or liabilities, such measurements involve developing assumptions based on market observable data and, in the absence of such data, internal information that is consistent with what market participants would use in a hypothetical transaction that occurs at the measurement date. | |||||||||
Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect our market assumptions. Preference is given to observable inputs. These two types of inputs create the following fair value hierarchy: | |||||||||
Level 1 | Quoted prices for identical instruments in active markets. | ||||||||
Level 2 | Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable. | ||||||||
Level 3 | Significant inputs to the valuation model are unobservable. | ||||||||
We maintain policies and procedures to value instruments using the best and most relevant data available. Our investment committee reviews and approves all investment valuations. | |||||||||
Our available-for-sale equity securities are all valued using Level 1 inputs or Level 2 inputs. | |||||||||
fair value of financial instruments | |||||||||
The Company is required to disclose fair value information about financial instruments when it is practicable to estimate that value. The carrying amounts of the Company’s cash, accounts receivable, other receivables, inventory, accounts payable, accrued expenses, other current liabilities, convertible notes payable and notes payable approximate their estimated fair value due to the short-term maturities of these financial instruments and because related interest rates offered to the Company approximate current rates. | |||||||||
Property and Equipment | |||||||||
Property and equipment are stated at cost, less accumulated depreciation. Depreciation and amortization, which includes amortization of assets held under capital leases, are recorded generally using the straight-line method over the estimated useful lives of the respective assets or, if shorter, the term of the lease for certain assets held under a capital lease. Leasehold improvements are amortized over the lesser of the expected lease term, or the estimated useful lives of the related assets using the straight-line method. | |||||||||
The estimated useful lives used to compute depreciation and amortization are as follow: | |||||||||
Leasehold Improvements | 5-10 years | ||||||||
Restaurant furnishings and equipment | 10-Mar | ||||||||
Furniture and fixtures | 10-Mar | ||||||||
Office and computer equipment | 5-Mar | ||||||||
The carrying amount of all long-lived assets is evaluated periodically to determine if adjustment to the depreciation and amortization period or the unamortized balance is warranted. Based upon its most recent analysis, the Company believes that no impairment of property and equipment exists at December 31, 2014 and 2013. | |||||||||
Maintenance and repairs are charged to operations when incurred. Betterments and renewals are capitalized. When property and equipment are sold or otherwise disposed of, the asset account and related accumulated depreciation account are relieved, and any gain or loss is included in operations. | |||||||||
Goodwill | |||||||||
The Company reviews goodwill for impairment annually or more frequently if indicators of impairment exist. Goodwill is not subject to amortization and has been assigned to reporting units for purposes of impairment testing. The reporting units are our restaurant brands and/or geographic area. | |||||||||
A significant amount of judgment is involved in determining if an indicator of impairment has occurred. Such indicators may include, among others: a significant decline in the Company’s expected future cash flows; a sustained, significant decline in our stock price and market capitalization; a significant adverse change in legal factors or in the business climate; unanticipated competition; the testing for recoverability of a significant asset group within a reporting unit; and slower growth rates. Any adverse change in these factors could have a significant impact on the recoverability of these assets and could have a material impact on the Company’s consolidated financial statements. | |||||||||
The goodwill impairment test involves a two-step process. The first step is a comparison of each reporting unit’s fair value to its carrying value. The Company estimates fair value using the best information available, including market information and discounted cash flow projections (also referred to as the income approach). The income approach uses a reporting unit’s projection of estimated operating results and cash flows that is discounted using a weighted-average cost of capital that reflects current market conditions. The projection uses management’s best estimates of economic and market conditions over the projected period including growth rates in sales, costs and number of units, estimates of future expected changes in operating margins and cash expenditures. Other significant estimates and assumptions include terminal value growth rates, future estimates of capital expenditures and changes in future working capital requirements. The Company validates its estimates of fair value under the income approach by comparing the values to fair value estimates using a market approach. A market approach estimates fair value by applying cash flow and sales multiples to the reporting unit’s operating performance. The multiples are derived from comparable publicly traded companies with similar operating and investment characteristics of the reporting units. | |||||||||
If the fair value of the reporting unit is higher than its carrying value, goodwill is deemed not to be impaired, and no further testing is required. If the carrying value of the reporting unit is higher than its fair value, there is an indication that impairment may exist and the second step must be performed to measure the amount of impairment loss. The amount of impairment is determined by comparing the implied fair value of reporting unit goodwill to the carrying value of the goodwill in the same manner as if the reporting unit was being acquired in a business combination. Specifically, fair value is allocated to all of the assets and liabilities of the reporting unit, including any unrecognized intangible assets, in a hypothetical analysis that would calculate the implied fair value of goodwill. If the implied fair value of goodwill is less than the recorded goodwill, the Company would record an impairment loss for the difference. | |||||||||
InTANGIBLE ASSETS | |||||||||
Trade Name/Trademark | |||||||||
The fair value of trade name/trademarks are estimated and compared to the carrying value. The Company estimates the fair value of trademarks using the relief-from-royalty method, which requires assumptions related to projected sales from its annual long-range plan; assumed royalty rates that could be payable if the Company did not own the trademarks; and a discount rate. The Company’s trade name/trademarks have been determined to have a definite-lived life and is being amortized on a straight-line basis over estimated useful lives of 10 years. The amortization expense of these definite-lived intangibles is included in depreciation and amortization in the Company’s consolidated statement of operations. | |||||||||
Franchise Cost | |||||||||
Intangible assets are recorded for the initial franchise fees for our Hooter’s restaurants. The Company amortizes these amounts over a 20 year period, which is the life of the franchise agreement. | |||||||||
IMPAIRMENT OF LONG-LIVED ASSETS | |||||||||
The Company reviews the recoverability of all long-lived assets, including the related useful lives, whenever events or changes in circumstances indicate that the carrying amount of a long-lived asset might not be recoverable. If required, the Company compares the estimated fair value determined by either the undiscounted future net cash flows or appraised value to the related asset’s carrying value to determine whether there has been an impairment. If an asset is considered impaired, the asset is written down to fair value in the period in which the impairment becomes known. The Company recognized no significant impairment charges during the years ended December 31, 2014 and December 31, 2013, with the exception of charges taken to write-off long-live assets of the Company’s Discontinued Operations (See Note 5 “Discontinued Operations”). | |||||||||
DERIVATIVE LIABILITIES | |||||||||
In connection with the issuance of a secured convertible promissory note, the terms of the convertible note included an embedded conversion feature; which provided for the settlement of the convertible promissory note into shares of common stock at a rate which was determined to be variable. The Company determined that the conversion feature was an embedded derivative instrument pursuant to ASC 815 “Derivatives and Hedging”. | |||||||||
The accounting treatment of derivative financial instruments requires that the Company record the conversion option and related warrants at their fair values as of the inception date of the agreements and at fair value as of each subsequent balance sheet date. Any change in fair value was recorded as a change in the fair value of derivative liabilities for each reporting period at each balance sheet date. The Company reassesses the classification at each balance sheet date. If the classification changes as a result of events during the period, the contract is reclassified as of the date of the event that caused the reclassification. | |||||||||
The fair value of an embedded conversion option that is convertible into a variable amount of shares are deemed to be a “down-round protection” and therefore, do not meet the scope exception for treatment as a derivative under ASC 815. Since, “down-round protection” is not an input into the calculation of the fair value of the conversion option and cannot be considered “indexed to the Company’s own stock” which is a requirement for the scope exception as outlined under ASC 815. The Company determined the fair value of the Binomial Lattice Model and the Black-Scholes Model to be materially the same. The Company’s outstanding warrants did not contain any round down protection. | |||||||||
The Black-Scholes option valuation model is used to estimate the fair value of the warrants or options granted. The model includes subjective input assumptions that can materially affect the fair value estimates. The model was developed for use in estimating the fair value of traded options or warrants. The expected volatility is estimated based on the most recent historical period of time equal to the weighted average life of the warrants or options granted. | |||||||||
ACQUIRED ASSETS AND ASSUMED LIABILITIES | |||||||||
Pursuant to ASC No. 805-10-25, if the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination occurs, but during the allowed measurement period not to exceed one year from the acquisition date, the company retrospectively adjusts the provisional amounts recognized at the acquisition date by means of adjusting the amount recognized for goodwill. | |||||||||
Income Taxes | |||||||||
Deferred income taxes are provided on the liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax basis. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The Company has provided a valuation allowance for the full amount of the deferred tax assets. | |||||||||
As of December 31, 2014 and 2013 the Company had no accrued interest or penalties relating to any tax obligations. The Company currently has no federal or state examinations in progress, nor has it had any federal or state tax examinations since its inception. The last three years of the Company’s tax years are subject to federal and state tax examination. | |||||||||
Stock-based Compensation | |||||||||
The compensation cost relating to share-based payment transactions (including the cost of all employee stock options) is required to be recognized in the financial statements. That cost is measured based on the estimated fair value of the equity or liability instruments issued. A wide range of share-based compensation arrangements including share options, restricted share plans, performance-based awards, share appreciation rights and employee share purchase plans are included. The Company’s financial statements would include an expense for all share-based compensation arrangements granted on or after January 1, 2006 and for any such arrangements that are modified, cancelled or repurchased after that date based on the grant-date estimated fair value. | |||||||||
As of December 31, 2014 and 2013, there were no options outstanding. See Note 14 regarding outstanding warrants. | |||||||||
LOSS PER COMMON SHARE | |||||||||
The Company is required to report both basic earnings per share, which is based on the weighted-average number of shares outstanding and diluted earnings per share, which is based on the weighted-average number of common shares outstanding plus all diluted shares outstanding. | |||||||||
The following table summarizes the number of common shares potentially issuable upon the exercise of certain warrants, convertible notes payable and convertible interest as of December 31, 2014 and 2013, that have been excluded from the calculation of diluted net loss per common share since the effect would be antidilutive. | |||||||||
31-Dec-14 | 31-Dec-13 | ||||||||
Warrants | 8,715,804 | 7,322,125 | |||||||
Convertible notes payable | 2,626,900 | 637,592 | |||||||
Convertible interest | 42,306 | 282,600 | |||||||
Total | 11,385,010 | 8,242,317 | |||||||
ADVERTISING | |||||||||
Advertising costs are expensed as incurred. Advertising expenses which are included in restaurant operating expenses in the accompanying consolidated statement of operations, totaled $444,488 and $183,656 for the years ended December 31, 2014 and 2013, respectively. Advertising expense primarily includes local advertising. | |||||||||
AMORTIZATION OF DEBT DISCOUNT | |||||||||
In 2014, the Company issued various debt with warrants for which total proceeds were allocated to individual instruments based on the relative fair value of the each instrument at the time of issuance. The value of the debt was recorded as discount on debt and amortized over the term of the respective debt. For the year ended December 31, 2014, amortization of debt discount was $1,400,392. | |||||||||
FOREIGN CURRENCY TRANSLATION | |||||||||
Assets and liabilities denominated in local currency are translated to US dollars using the exchange rates as in effect at the balance sheet date. Results of operations are translated using average exchange rates prevailing throughout the period. Adjustments resulting from the process of translating foreign currency financial statements from functional currency into U.S. dollars are included in accumulated other comprehensive loss within stockholders’ equity. Foreign currency translation adjustments were $(1,345,794) and $95,210 for the years ended December 31, 2014 and 2013, respectively. Aggregate cumulative translation adjustments as of December 31, 2014 and 2013 were $(1,225,944) and $119,849, respectively. Foreign currency transaction gains and losses are included in current earnings. The Company has determined that local currency is the functional currency for each of its foreign operations. | |||||||||
Comprehensive Income (LOSS) | |||||||||
Standards for reporting and displaying comprehensive income (loss) and its components (revenues, expenses, gains and losses) in a full set of general-purpose financial statements requires that all items that are required to be recognized under accounting standards as components of comprehensive income (loss) be reported in a financial statement that is displayed with the same prominence as other financial statements. We are required to (a) classify items of other comprehensive income (loss) by their nature in financial statements, and (b) display the accumulated balance of other comprehensive income (loss) separately in the equity section of the balance sheet for all periods presented. Other comprehensive income (loss) items include foreign currency translation adjustments, and the unrealized gains and losses on our marketable securities classified as held for sale. | |||||||||
concentration of credit risk | |||||||||
The Company maintains its cash with major financial institutions. Cash held in U.S. bank institutions is currently insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000 at each institution. No similar insurance or guarantee exists for cash held in Australia, South Africa, Hungary or United Kingdom bank accounts. There was a $122,633 and $211,064 aggregate uninsured cash balances at December 31, 2014 and 2013, respectively. | |||||||||
Subsequent Events. | |||||||||
Management has evaluated all events and transactions that occurred from January 1, 2015 through the date these consolidated financial statements were issued for subsequent events requiring recognition or disclosure in the financial statements | |||||||||
RECLASSIFICATIONS | |||||||||
Certain reclassifications have been made in the financial statements at December 31, 2014 and for the periods then ended to conform to the December 31, 2014 presentation. The reclassifications had no effect on net loss. | |||||||||
RECENT ACCOUNTING PRONOUNCEMENTS | |||||||||
In March 2013, the FASB issued ASU 2013-05, “Foreign Currency Matters” (“ASU 2013-05”). The amendments in ASU 2013-05 resolve the diversity in practice about whether current literature applies to the release of the cumulative translation adjustment into net income when a parent either sells a part or all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a nonprofit activity or a business within a foreign entity. In addition, the amendments in ASU 2013-05 resolve the diversity in practice for the treatment of business combinations achieved in stages (sometimes also referred to as step acquisitions) involving a foreign entity. ASU 2013-05 is effective prospectively for fiscal years and interim reporting periods within those years, beginning after December 15, 2013. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial position and results of operations. | |||||||||
The FASB has issued ASU 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity, which includes amendments that change the requirements for reporting discontinued operations and requires additional disclosures about discontinued operations. Under the new guidance, only disposals representing a strategic shift in operations should be presented as discontinued operations. The guidance is effective for annual periods beginning on or after December 15, 2014. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial position and results of operations. | |||||||||
In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements – Going Concern (Subtopic 205-40): Disclosure of Uncertainties About an Entity’s Ability to Continue as a Going Concern. The standard is intended to define management’s responsibility to decide whether there is substantial doubt about an organization’s ability to continue as a going concern and to provide related footnote disclosures. The standard requires management to decide whether there are conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. The standard provides guidance to an organization’s management, with principles and definitions that are intended to reduce diversity in the timing and content of disclosures that are commonly provided by organizations in their footnotes. The standard becomes effective in annual periods ending after December 15, 2016, with early application permitted. The adoption of this pronouncement is not expected to have a material impact on the consolidated financial statements. Management’s evaluations regarding the Company’s ability to continue as a going concern have been disclosed in Note 1 of the accompanying consolidated financial statements. | |||||||||
In November 2014, the FASB issued ASU No. 2014-17, “Business Combinations (Topic 805): Pushdown Accounting” (“ASU 2014-17”). ASU 2014-17 provides with an option to apply pushdown accounting in its separate financial statements upon occurrence of an event in which an acquirer obtains control of the acquired entity. The acquired entity may elect the option to apply pushdown accounting in the reporting period in which the change-in-control event occurs. If pushdown accounting is not applied in the reporting period in which the change-in-control event occurs, an acquired entity will have the option to elect to apply pushdown accounting in a subsequent reporting period as a change in accounting principle in accordance with ASC Topic 250, “Accounting Changes and Error Corrections”. If pushdown accounting is applied to an individual change-in-control event, that election is irrevocable. ASU 2014-17 also requires an acquired entity that elects the option to apply pushdown accounting in its separate financial statements to disclose information in the current reporting period that enables users of financial statements to evaluate the effect of pushdown accounting. The Company has adopted the amendments in ASU 2014-17, effective November 18, 2014, as the amendments in the update are effective upon issuance. The adoption did not have an impact on the Company’s Consolidated Financial Statements. | |||||||||
There are several other new accounting pronouncements issued by FASB which are not yet effective. Each of these pronouncements has been or will be adopted, as applicable, by the Company. At December 31, 2014, none of these pronouncements are expected to have a material effect on the financial position, results of operations or cash flows of the Company. |
Acquisitions
Acquisitions | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Business Combinations [Abstract] | |||||||||||||||||||||||||
Acquisitions | 3. ACQUISITIONS | ||||||||||||||||||||||||
During the year ended December 31, 2013 the Company made the following acquisitions: | |||||||||||||||||||||||||
● | American Roadside Burgers, effective September 30, 2013; | ||||||||||||||||||||||||
● | West End Wings, LTD (Hooters Nottingham), effective November 7, 2013; | ||||||||||||||||||||||||
● | 56% ownership interest in Just Fresh, effective December 10, 2013; | ||||||||||||||||||||||||
During the year ended December 31, 2014, the Company made the following acquisitions: | |||||||||||||||||||||||||
● | Spoon Bar and Kitchen located in Dallas, Texas, effective January 2014 (and of which we subsequently sold the assets used in the operations of the restaurant to Express Working Capital, LLC d/b/a CapRock Services effective December 31, 2014). | ||||||||||||||||||||||||
● | Tacoma Wings, LLC, Jantzen Beach Wings, LLC and Oregon Owl’s Nest, LLC, effective January 31, 2014; and | ||||||||||||||||||||||||
● | Hoot Campbelltown Pty. Ltd., Hoot Surfers Paradise Pty. Ltd. and Hoot Townsville Pty. Ltd., step acquisition from 49% to 60% effective April 1, 2014. | ||||||||||||||||||||||||
● | 60% ownership interest in Hoot Parramatta Pty Ltd, Hoot Australia Pty Ltd, Hoot Penrith Pty Ltd, and TMIX Management Australia Pty Ltd., effective July 1, 2014. | ||||||||||||||||||||||||
● | The Burger Company, LLC, effective September 9, 2014. | ||||||||||||||||||||||||
In connection with the acquisition of the restaurants, the Company analyzed each acquisition to determine the purchase price allocation in consideration of all identifiable intangibles. Based on our evaluation, there were no marketing related assets, customer related intangibles or contract based arrangements for which the purchase price would be required to be allocated. For marketing related assets, the Company did not acquire any trademarks or trade names (for Hooters acquisitions) or enter into any non-compete agreements. The Company is however required to pay royalties based on future sales. For acquisitions other than Hooters restaurants, the value of any trademark/tradename, was calculated using a relief of royalty method considering future franchise opportunities, and the value was determined to be de minimus. With respect to customer related intangibles, the Company did not acquire any customer lists or enter into any customer contractual arrangements nor did the Company enter into any licensing or royalty arrangements requiring a further allocation of the purchase price. The premium paid for the businesses represents the economic value which is not captured by other assets such as the reputation of the businesses, the value of its human capital, its future growth potential and its professional management. The acquisition of these businesses will help the Company expand its domestic operations and presence. | |||||||||||||||||||||||||
2013 Acquisitions | |||||||||||||||||||||||||
American Roadside Burgers / American Burger Company (“ABC”) | |||||||||||||||||||||||||
In September 2013, we acquired all of the outstanding shares of American Roadside Burgers, Inc., which we are operating under the brand name American Burger Company (“ABC”). In exchange, the Company issued 740,000 shares of its common stock and warrants to acquire 740,000 shares of common stock for $5.00 per share. The warrants are exercisable beginning October 1, 2014 until September 30, 2018. In connection with this acquisition and the related management team, the Company acquired a strategic opportunity to participate in a high-growth space with an already established brand. The Company plans to continue to expand the American Roadside chain as future opportunities are presented, which has the potential to bring revenue and profits to the Company. During March and April 2014, the Company began doing business as American Burger Company at the two Charlotte ABC locations. | |||||||||||||||||||||||||
The shares issued in connection with the acquisition were valued based on the Company’s closing stock market price on September 30, 2013, the date the acquisition was consummated. For the fair value of the warrants issued, we used the following inputs in the application of the Black-Scholes Option Pricing model: | |||||||||||||||||||||||||
● | Current equity value: Our common stock, ticker HOTR on NASDAQ closing price on September 30, 2013, the valuation date, was $4.88. | ||||||||||||||||||||||||
● | Strike price of the warrants: Per the warrant agreement, the strike price was $5.00. | ||||||||||||||||||||||||
● | Time to maturity: The term of the warrants was calculated based on the time until the expiration date, which per the warrant agreement is five years. | ||||||||||||||||||||||||
● | Volatility of the underlying asset: The volatility utilized in the analysis of the warrants was 55.0%, based on our analysis of industry peers. | ||||||||||||||||||||||||
● | Risk-free rate of interest of: The risk-free interest rate was based on the rate of treasury securities with a similar term as the warrants, and was 1.39%. | ||||||||||||||||||||||||
The Black-Scholes option valuation model is used to estimate the fair value of the warrants or options granted. The model includes subjective input assumptions that can materially affect the fair value estimates. The Company determined the fair value of the Binomial Lattice Model and the Black-Scholes Valuation Model to be materially the same. The expected stock price volatility for the Company’s warrants was determined by the historical volatilities for industry peers and used an average of those volatilities. The risk free interest rate was obtained from U.S. Treasury rates for the applicable periods. The contractual terms of the agreement does not provide for and the Company does not expect to declare dividends in the near future. | |||||||||||||||||||||||||
There is inherent uncertainty in our forecasts and projections, and if we had made different assumptions and estimates than those described previously, the determined fair value of our common stock as of each of the valuation dates could have been materially different. | |||||||||||||||||||||||||
West End Wings (“WEW” or “Hooters Nottingham”) | |||||||||||||||||||||||||
On November 6, 2013, the Company finalized the purchase of West End Wings LTD, which is the owner of the Nottingham, England Hooters restaurant location. The purchase price paid by the Company for WEW was $3,150,000. | |||||||||||||||||||||||||
The acquisition was accounted for using the purchase method in accordance with ASC 805 “Business Combinations”. The consolidated statements of operations include the results of the Hooters Nottingham operations beginning November 7, 2013. The assets acquired and the liabilities assumed were recorded at November 6, 2013 at estimated fair values as determined by the Company’s management. | |||||||||||||||||||||||||
In connection with the acquisition of West End Wings, the Company analyzed the acquisition to determine the purchase price allocation in consideration of all identifiable intangibles. Based on our evaluation, there were no marketing related assets or customer related intangibles for which the purchase price would be required to be allocated. The Company is however required to pay royalties based on future sales. For marketing-related assets, the Company did not acquire the rights to any trademarks or trade names or enter into any non-compete agreements. The value of any franchise rights was determined to be de minimis given the franchise agreement provides no significant territorial exclusiveness and given the nominal value of any required franchise fees. The premium paid for the business represents the economic value which is not captured by other assets such as the reputation of the business, the value of its human capital, its future growth potential and its professional management. The acquisition of this business will help the Company expand its international operations. | |||||||||||||||||||||||||
Just Fresh (“JF”) | |||||||||||||||||||||||||
On November 5, 2013, the Company entered into a Subscription Agreement with JF Restaurants, L.L.C. (“JFR”) and JF Franchising Systems, L.L.C. (“JFFS”), for the purchase of a 51%ownership interest in each entity, for a total purchase price of $560,000. The purchase was finalized on December 10, 2013 with the execution of an Assignment, Assumption, Joinder, and Amendment Agreement with both JFR and JFFS. On December 11, 2013, the Company purchased an additional 5% interest in both JFR and JFFS from an original interest holder for the total purchase price of $30,000, increasing the Company’s ownership interest in JFR and JFFS to a total of 56%. | |||||||||||||||||||||||||
Just Fresh currently operates seven restaurants in the Charlotte, North Carolina area that offer fresh-squeezed juices, gourmet coffee, fresh-baked goods and premium-quality, made-to-order sandwiches, salads and soups. | |||||||||||||||||||||||||
2014 Acquisitions | |||||||||||||||||||||||||
Tacoma Wings, Jantzen Beach Wings and Oregon Owl’s Nest (“Hooters Pacific NW”) | |||||||||||||||||||||||||
On January 31, 2014, pursuant to an Agreement and Plan of Merger executed on December 31, 2013, the Company completed the acquisition of all of the outstanding shares of each of Tacoma Wings, LLC, Jantzen Beach Wings, LLC and Oregon Owl’s Nest, LLC, which owned and operated the Hooters restaurant locations in Tacoma, Washington and Portland, Oregon, respectively. These entities were purchased from Hooters of Washington, LLC and Hooters of Oregon Partners, LLC (collectively, the “Hooters Sellers”) for a total purchase price of 680,272 Company units, with each unit consisting of one share of the Company’s common stock and one five-year warrant to purchase a share of the Company’s common stock. Half of the warrants are exercisable at $5.50 and half of the warrants are exercisable at $7.00. As part of this transaction, the Hooters Sellers were granted registration rights with respect to the Company’s common stock issued and underlying the warrants, and franchise rights and leasehold rights to the locations were transferred to the Company. | |||||||||||||||||||||||||
Dallas Spoon and Dallas Spoon Beverage (“Spoon”) | |||||||||||||||||||||||||
Also on January 31, 2014, pursuant to an Agreement and Plan of Merger executed on January 14, 2014, the Company completed the acquisition of all of the outstanding shares of Dallas Spoon, LLC and Dallas Spoon Beverage, LLC from Express Restaurant Holdings, LLC and Express Restaurant Holdings Beverage, LLC. The purchase price of 195,000 Company units was paid to Express Working Capital, LLC (“EWC”); the units consist of one share of the Company’s common stock and one five-year warrant to purchase a share of the Company’s common stock. Half of the warrants are exercisable at $5.50 and half of the warrants are exercisable at $7.00. As part of this transaction, EWC was granted registration rights with respect to the Company’s common stock issued and underlying the warrants, and all leaseholds and other rights were transferred to the Company. (See Note 5 “Discontinued Operations”) | |||||||||||||||||||||||||
For the acquisitions of Hooters Pacific NW and Spoon, the fair value of the shares was the closing stock market price on January 31, 2014, the date the deal acquisition was consummated. The fair value of the warrants issued was determined using the Black-Scholes model. The model includes subjective input assumptions that can materially affect the fair value estimates. The Company determined the fair value of the Binomial Lattice Model and the Black-Scholes Valuation Model to be materially the same. The expected stock price volatility for the Company’s warrants was determined by the historical volatilities for industry peers and used an average of those volatilities. The risk free interest rate was obtained from U.S. Treasury rates for the applicable periods. The contractual terms of the agreement does not provide for and the Company does not expect to declare dividends in the near future. The assumptions were as follows: | |||||||||||||||||||||||||
Acquisitions of Hooters Pacific NW and Spoon: | |||||||||||||||||||||||||
Assumptions: | |||||||||||||||||||||||||
Risk-free interest rate | 0.79 | % | |||||||||||||||||||||||
Expected life | 5 years | ||||||||||||||||||||||||
Expected volatility | 89.1 | % | |||||||||||||||||||||||
Dividends | 0 | % | |||||||||||||||||||||||
Campbelltown, Penrith, Parramatta, Surfers Paradise, and Townsville (“Hooters Australia”) | |||||||||||||||||||||||||
On April 1, 2014, the Company completed the step acquisition of Hooters Australia, increasing the Company’s ownership percentage from 49% to 60%. The location in Campbelltown, a suburb of Sydney, opened in January 2012; the location in Surfers Paradise, an iconic coastal tourist destination, opened on July 14, 2014; and we expect the location in Townsville, in the northeast part of Australia, to open in late 2014. On July 1, 2014, the Company acquired 60% of the two other Hooters restaurants in Australia, in Penrith and Parramatta, suburbs of Sydney, as well as a 60% interest in the related Australian management company. These entities own, operate, and manage Australian Hooters restaurants and gaming operations. The purchase price was the assumption of $5 million in debt and the issuance of 250,000 five-year warrants at an exercise price to be determined at the next public offering or the end of twelve calendar months. Also as part of the transaction, the Company will receive 100% of all gaming revenue until the debt is repaid, and thereafter the Company will receive 60% of such revenue for the remainder of the lifetime of the gaming machines. | |||||||||||||||||||||||||
The fair value of the warrants issued was determined using the Black-Scholes model. The model includes subjective input assumptions that can materially affect the fair value estimates. The Company determined the fair value of the Binomial Lattice Model and the Black-Scholes Valuation Model to be materially the same. The expected stock price volatility for the Company’s warrants was determined by the historical volatilities for industry peers and used an average of those volatilities. The risk free interest rate was obtained from U.S. Treasury rates for the applicable periods. The contractual terms of the agreement does not provide for and the Company does not expect to declare dividends in the near future. The assumptions were as follows: | |||||||||||||||||||||||||
Acquisitions of Hooters Australia: | |||||||||||||||||||||||||
Assumptions: | |||||||||||||||||||||||||
Risk-free interest rate | 1.62 | % | |||||||||||||||||||||||
Expected life | 5 years | ||||||||||||||||||||||||
Expected volatility | 109.1 | % | |||||||||||||||||||||||
Dividends | 0 | % | |||||||||||||||||||||||
The Burger Company | |||||||||||||||||||||||||
On September 9, 2014, the Company purchased 100% of the net assets of The Burger Company located in Charlotte, North Carolina, a similar concept to our ABC restaurants, for a purchase price of $550,000, which consisted of $250,000 in cash and $300,000 in the Company’s common stock. | |||||||||||||||||||||||||
Summary of 2013 and 2014 Acquisitions | |||||||||||||||||||||||||
The acquisitions were accounted for using the purchase method of accounting in accordance with ASC 805 “Business Combinations” and, accordingly, the condensed consolidated statements of operations include the results of these operations from the dates of acquisition. The assets acquired and the liabilities assumed were recorded at estimated fair values based on information currently available and based on certain assumptions as to future operations as follows: | |||||||||||||||||||||||||
2013 Acquisitions | |||||||||||||||||||||||||
ARB | WEW | JF | Total | ||||||||||||||||||||||
Consideration paid: | |||||||||||||||||||||||||
Common stock | $ | 3,611,126 | $ | - | $ | - | $ | 3,611,126 | |||||||||||||||||
Warrants | 1,710,077 | - | - | 1,710,077 | |||||||||||||||||||||
Cash | - | 3,150,000 | 590,000 | 3,740,000 | |||||||||||||||||||||
Total consideration paid | 5,321,203 | 3,150,000 | 590,000 | 9,061,203 | |||||||||||||||||||||
Current assets, excluding cash | 281,574 | 151,546 | 42,206 | 475,326 | |||||||||||||||||||||
Property and equipment | 3,000,122 | 20,493 | 242,531 | 3,263,146 | |||||||||||||||||||||
Goodwill | 2,550,611 | 3,159,500 | 425,151 | 6,135,262 | |||||||||||||||||||||
Trademark/trade name/franchise fee | 1,784,443 | - | 1,010,000 | 2,794,443 | |||||||||||||||||||||
Deposits and other assets | 98,035 | - | - | 98,035 | |||||||||||||||||||||
Total assets acquired, less cash | 7,714,785 | 3,331,539 | 1,719,888 | 12,766,212 | |||||||||||||||||||||
Liabilities assumed | (1,490,288 | ) | (372,824 | ) | (282,317 | ) | (2,145,429 | ) | |||||||||||||||||
Deferred tax liabilities | (956,000 | ) | - | (384,000 | ) | (1,340,000 | ) | ||||||||||||||||||
Non-controlling interest | - | - | (463,571 | ) | (463,571 | ) | |||||||||||||||||||
Common stock and warrants issued | (5,321,203 | ) | - | - | (5,321,203 | ) | |||||||||||||||||||
Cash paid | - | (3,150,000 | ) | (590,000 | ) | (3,740,000 | ) | ||||||||||||||||||
Cash received in excess of cash paid | $ | 52,706 | $ | 191,285 | $ | - | $ | 243,991 | |||||||||||||||||
2014 Acquisitions | |||||||||||||||||||||||||
Hooters | Hooters Australia | The | |||||||||||||||||||||||
Pacific NW | Spoon | April 1, 2014 | July 1, 2014 | Burger Co. | Total | ||||||||||||||||||||
Consideration paid: | |||||||||||||||||||||||||
Common stock | $ | 2,891,156 | $ | 828,750 | $ | - | $ | - | $ | 300,000 | $ | 4,019,906 | |||||||||||||
Warrants | 978,000 | 280,400 | - | 123,333 | - | 1,381,733 | |||||||||||||||||||
Assumption of debt | - | - | - | 5,000,000 | - | 5,000,000 | |||||||||||||||||||
Cash | - | - | 100,000 | - | 250,000 | 350,000 | |||||||||||||||||||
Total consideration paid | 3,869,156 | 1,109,150 | 100,000 | 5,123,333 | 550,000 | 10,751,639 | |||||||||||||||||||
Current assets, excluding cash | 112,078 | 89,817 | 377,296 | 47,777 | 9,926 | 636,894 | |||||||||||||||||||
Property and equipment | 2,731,031 | 391,462 | 2,934,307 | 1,603,557 | 284,795 | 7,945,152 | |||||||||||||||||||
Goodwill | 1,951,909 | 698,583 | - | 8,487,138 | 256,379 | 11,394,009 | |||||||||||||||||||
Trademark/trade name/franchise fee | 60,937 | - | 277,867 | 220,500 | - | 559,304 | |||||||||||||||||||
Deposits and other assets | 20,275 | 5,193 | 90,371 | 20,186 | - | 136,025 | |||||||||||||||||||
Total assets acquired, less cash | 4,876,230 | 1,185,055 | 3,679,841 | 10,379,158 | 551,100 | 20,671,384 | |||||||||||||||||||
Liabilities assumed | (1,009,348 | ) | (97,541 | ) | (1,560,710 | ) | (1,496,536 | ) | (1,100 | ) | (4,165,235 | ) | |||||||||||||
Non-controlling interest | - | - | (993,999 | ) | (3,759,289 | ) | - | (4,753,288 | ) | ||||||||||||||||
Chanticleer equity | - | - | (1,028,749 | ) | - | - | (1,028,749 | ) | |||||||||||||||||
Common stock and warrants issued | (3,869,156 | ) | (1,109,150 | ) | - | (123,333 | ) | (300,000 | ) | (5,401,639 | ) | ||||||||||||||
Assumption of debt | - | - | - | (5,000,000 | ) | - | (5,000,000 | ) | |||||||||||||||||
Cash paid | - | - | (100,000 | ) | - | (250,000 | ) | (350,000 | ) | ||||||||||||||||
Cash received in excess of cash paid | $ | 2,274 | $ | 21,636 | $ | 3,617 | $ | - | $ | - | $ | 27,527 | |||||||||||||
Unaudited pro forma results of operations for the years ended December 31, 2014 and 2013 as if the Company had acquired majority ownership of the operation on January 1 of each year is as follows. The pro forma results include estimates and assumptions which management believes are reasonable. However, pro forma results are not necessarily indicative of the results that would have occurred if the business combination had been in effect on the dates indicated, or which may result in the future. | |||||||||||||||||||||||||
Years Ended | |||||||||||||||||||||||||
December 31, | |||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
Total revenues | $ | 34,531,238 | $ | 31,949,925 | |||||||||||||||||||||
Loss from continuing operations | (5,845,064 | ) | (6,276,055 | ) | |||||||||||||||||||||
Loss from discontinued operations | (920,960 | ) | (25,215 | ) | |||||||||||||||||||||
Loss attributable to non-controlling interest | (247,705 | ) | (264,022 | ) | |||||||||||||||||||||
Net loss | $ | (6,092,769 | ) | $ | (6,540,077 | ) | |||||||||||||||||||
Net loss per share, basic and diluted | $ | (0.96 | ) | $ | (1.50 | ) | |||||||||||||||||||
Net loss per share, discontinued operations | $ | (0.15 | ) | $ | (0.01 | ) | |||||||||||||||||||
The following table includes information from the Company’s 2013 acquisitions for the year ended December 31, 2013: | |||||||||||||||||||||||||
2013 Acquistions | |||||||||||||||||||||||||
ARC | Just Fresh | WEW | Total | ||||||||||||||||||||||
Revenues | $ | 701,742 | $ | 182,091 | $ | 560,614 | $ | 1,444,447 | |||||||||||||||||
Cost of sales | 282,454 | 53,964 | 197,169 | 533,587 | |||||||||||||||||||||
Other expenses | 787,757 | 179,109 | 274,021 | 1,240,887 | |||||||||||||||||||||
Operating income (loss) | $ | (368,469 | ) | $ | (50,982 | ) | $ | 89,424 | $ | (330,027 | ) | ||||||||||||||
The following table includes information from the Company’s 2014 acquisitions for the year ended December 31, 2014: | |||||||||||||||||||||||||
2014 Acquistions | |||||||||||||||||||||||||
Hooters Pacific NW | Spoon | Hooters Australia | The Burger Co. | Total | |||||||||||||||||||||
Revenues | $ | 4,382,492 | $ | 1,207,688 | $ | 5,613,381 | $ | 81,539 | $ | 11,285,100 | |||||||||||||||
Cost of sales | 1,239,726 | 529,974 | 1,564,198 | 33,305 | 3,367,203 | ||||||||||||||||||||
Other expenses | 3,340,963 | 915,661 | 4,330,224 | 30,847 | 8,617,695 | ||||||||||||||||||||
Operating income (loss) | $ | (198,197 | ) | $ | (237,947 | ) | $ | (281,041 | ) | $ | 17,387 | $ | (699,798 | ) | |||||||||||
Income from operations of unconsolidated affiliates | |||||||||||||||||||||||||
On April 1, 2014, the Company increased its ownership in the Australian Hooters entities, Hoot Campbelltown Pty. Ltd., Hoot Surfers Paradise Pty. Ltd. and Hoot Townsville Pty. Ltd., from 49% to 60%. | |||||||||||||||||||||||||
On July 1, 2014, we purchased 60% of Hoot Parramatta Pty Ltd, Hoot Australia Pty Ltd, Hoot Penrith Pty Ltd, and TMIX Management Australia Pty Ltd. | |||||||||||||||||||||||||
Prior to April 1, 2014, the Company accounted for its 49% ownership using the equity method of accounting and our share of earnings and losses was recorded in equity in losses from investments in our Consolidated Statements of Operations and Comprehensive Loss. For periods subsequent to April 1, 2014, the results of the Australia entities are consolidated in our Consolidated Statements of Operations and Comprehensive Loss effective with the date of controlling ownership. |
Investments
Investments | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||
Investments | 4. INVESTMENTS | ||||||||||||||||||||
Investments at fair value consist of the following at December 31, 2014 and 2013. | |||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Available-for-sale investments at fair value | $ | 35,362 | $ | 55,112 | |||||||||||||||||
Total | $ | 35,362 | $ | 55,112 | |||||||||||||||||
Available-for-sale securities | |||||||||||||||||||||
Activity in our available-for-sale securities may be summarized as follows: | |||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Cost | $ | 263,331 | $ | 263,331 | |||||||||||||||||
Unrealized loss | (227,969 | ) | (208,219 | ) | |||||||||||||||||
Total | $ | 35,362 | $ | 55,112 | |||||||||||||||||
Our available-for-sale securities consist of the following: | |||||||||||||||||||||
Unrecognized | Realized | Gain | |||||||||||||||||||
Holding | Fair | Holding | on | ||||||||||||||||||
Cost | Gains (Losses) | Value | Loss | Sale | |||||||||||||||||
31-Dec-14 | |||||||||||||||||||||
Appalachian Mountain Brewery | 1,500 | 23,300 | 24,800 | - | 46,292 | ||||||||||||||||
North American Energy | 126,000 | (123,200 | ) | 2,800 | - | - | |||||||||||||||
North American Energy | 10,500 | (9,900 | ) | 600 | - | - | |||||||||||||||
North American Energy | 125,331 | (118,169 | ) | 7,162 | - | - | |||||||||||||||
$ | 263,331 | $ | (227,969 | ) | $ | 35,362 | $ | - | $ | 46,292 | |||||||||||
31-Dec-13 | |||||||||||||||||||||
Appalachian Mountain Brewery | 1,500 | 43,050 | 44,550 | - | - | ||||||||||||||||
North American Energy | 126,000 | (123,200 | ) | 2,800 | - | - | |||||||||||||||
North American Energy | 10,500 | (9,900 | ) | 600 | - | - | |||||||||||||||
North American Energy | 125,331 | (118,169 | ) | 7,162 | - | - | |||||||||||||||
$ | 263,331 | $ | (208,219 | ) | $ | 55,112 | $ | - | $ | - | |||||||||||
Appalachian Mountain Brewery (“AMB”), formerly North Carolina Natural Energy, Inc. (“NCNE”) – AMB is a successor to NCNE and its common stock is currently traded on the OTC market under the ticker HOPS. AMB began trading under this symbol on January 7, 2014; previously it was traded under ticker NCNE on the OTC stock market. As of December 31, 2014, the Company held 6,200 shares of AMB with a closing price of $4.01 per share. AMB makes craft beer with plans to expand its distribution network. AMB expects to have a food service line in addition to its beer products. NCNE was a successor to Remodel Auction Incorporated whose business was discontinued. The Company originally received 100,000,000 shares of NCNE (less than 1% on a fully diluted basis) for management services during 2011, valued at $1,500. | |||||||||||||||||||||
We recognized a realized gain of $46,492 in 2014 in connection with the sale of a portion of our investment in Appalachian Mountain Brewery. | |||||||||||||||||||||
North American Energy Resources, Inc. - During the quarter ended June 30, 2009, the Company exchanged its oil & gas property investments for 700,000 shares of North American Energy Resources, Inc. (“NAEY”) which were valued at $126,000 based on the closing price of NAEY on the OTC market on the date of the trade. NAEY is currently traded on the OTC market under the symbol NAEYD. At December 31, 2014 and 2013 the stock was $0.004 and $0.004 per share, respectively, and the Company recorded an unrealized loss of $123,200 at both December 31, 2014 and 2013 based on the Company’s determination that the price decline was temporary. | |||||||||||||||||||||
During the first quarter of 2010, the Company received an additional 150,000 shares of NAEY in exchange for management services. The shares were initially valued at $10,500, based on the trading price at the time. The Company recorded an unrealized loss of $9,900 at both December 31, 2014 and 2013 based on the Company’s determination that the price decline was temporary. | |||||||||||||||||||||
During June 2011, the Company’s CEO contributed 1,790,440 shares of NAEY to the Company which was valued at $125,331 based on the trading price at the time. Mr. Pruitt did not receive additional compensation as a result of the transfer. The Company recorded an unrealized loss of $118,169 at both December 31, 2014 and 2013 based on the Company’s determination that the price decline was temporary. | |||||||||||||||||||||
Other investments are summarized as follows at December 31, 2014 and 2013: | |||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Investments accounted for under the cost method | $ | 1,550,000 | $ | 1,550,000 | |||||||||||||||||
Investments accounted for under the equity method | - | 941,963 | |||||||||||||||||||
Total | $ | 1,550,000 | $ | 2,491,963 | |||||||||||||||||
Investments accounted for using the equity method | |||||||||||||||||||||
Effective April 1, 2014, the Company increased its ownership stake in Hooters restaurant in Campbelltown, Australia from 49% to 60%. In addition, the Company increased its ownership stake to 60% in the two new stores recently completed or under construction in Surfers Paradise (which opened on July 4, 2014), Australia and Townsville, Australia which we expect to open in 2015. | |||||||||||||||||||||
Also on July 1, 2014, the Company acquired 60% of the two other Hooters restaurants in Australia, in Penrith and Parramatta, suburbs of Sydney, as well as 60% interest in the related Australian management company. These entities own, operate, and manage Australian Hooters restaurants and gaming operations. The purchase price was the assumption of $5 million in debt. Also as part of the transaction, the Company will receive 100% of all gaming revenue until the debt is repaid, and thereafter the Company will receive 60% of such revenue for the remainder of the lifetime of the gaming machines. | |||||||||||||||||||||
Activity in investments accounted for using the equity method is summarized as follows: | |||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Balance, beginning of year | $ | 941,963 | $ | 1,066,915 | |||||||||||||||||
Equity in loss | (40,694 | ) | (125,017 | ) | |||||||||||||||||
New investments | 100,000 | 100,000 | |||||||||||||||||||
Reclassification of investments | (1,001,269 | ) | - | ||||||||||||||||||
Return of capital | - | (99,935 | ) | ||||||||||||||||||
Balance, end of year | $ | - | $ | 941,963 | |||||||||||||||||
Equity investments consist of the following at December 31, 2014 and December 31, 2013: | |||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Carrying value: | |||||||||||||||||||||
Hoot Campbelltown Pty. Ltd. (49%) - Australia | $ | - | $ | 483,603 | |||||||||||||||||
Hoot Surfers Paradise Pty. Ltd. (49%) - Australia | - | 384,605 | |||||||||||||||||||
Hoot Townsville Pty. Ltd. (49%) - Australia | - | 73,755 | |||||||||||||||||||
$ | - | $ | 941,963 | ||||||||||||||||||
The condensed statements of operations of equity investments for the years ended December 31, 2014 and 2013 follows: | |||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Revenue | $ | - | $ | 2,328,015 | |||||||||||||||||
Gross profit | - | 1,643,287 | |||||||||||||||||||
Loss from continuing operations | - | (255,136 | ) | ||||||||||||||||||
Net loss | - | (255,136 | ) | ||||||||||||||||||
Investments accounted for using the cost method | |||||||||||||||||||||
A summary of the activity in investments accounted for using the cost method follows. | |||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Investments at cost: | |||||||||||||||||||||
Balance, beginning of year | $ | 1,550,000 | $ | 1,050,000 | |||||||||||||||||
Impairment | - | - | |||||||||||||||||||
New investments | - | 500,000 | |||||||||||||||||||
Total | $ | 1,550,000 | $ | 1,550,000 | |||||||||||||||||
Investments at cost consist of the following at December 31, 2014 and 2013: | |||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Chanticleer Investors, LLC | $ | 800,000 | $ | 800,000 | |||||||||||||||||
Beacher’s Madhouse | 500,000 | 500,000 | |||||||||||||||||||
Edison Nation LLC (FKA Bouncing Brain Productions) | 250,000 | 250,000 | |||||||||||||||||||
$ | 1,550,000 | $ | 1,550,000 | ||||||||||||||||||
Chanticleer Investors LLC - On January 24, 2011, Investors LLC and its three partners combined to form HOA Holdings, LLC (“HOA LLC”) and completed the acquisition of HOA and Texas Wings, Inc. (“TW”). Together HOA LLC has created an operating company with 161 company-owned locations across sixteen states, or nearly half of all domestic Hooters restaurants and over one-third of the locations worldwide. | |||||||||||||||||||||
Investors, LLC had a note receivable in the amount of $5,000,000 from HOA that was repaid at closing. Investors LLC then invested $3,550,000 in HOA LLC (approximately 3.1%) ($500,000 of which was the Company’s share). One of the investors in Investors LLC that owned a $1,750,000 share is a direct investor in HOA LLC and will now carry its ownership in HOA LLC directly. In July 2012, the Company acquired an additional interest of $300,000, at cost, from one of the partners for cash, which increased our ownership to approximately 22% of Investors LLC as of December 31, 2013. | |||||||||||||||||||||
In August 2014, the Company received a cash distribution totaling $830,421 on its 3% equity interest in HOA LLC, of which $392,842 is reflected in management fee income and $437,579 is reflected in interest and other income in the accompanying Consolidated Statements of Operations. . | |||||||||||||||||||||
Based on the current status of this investment, the Company does not consider the investment to be impaired. | |||||||||||||||||||||
Beacher’s Madhouse – the Company acquired a 5% minority interest for $500,000 in Beacher’s, a variety show and nightclub experience. Beacher’s opened in late 2013 at an 8,500 square-foot performance theater located in the MGM Grand Hotel & Casino located on the strip in Las Vegas. Prior to the Las Vegas opening, the show was located in Los Angeles, California, which the Company has no stake in. The Company also received the right to participate in the financing of up to 25% offered to third party investors in any new Beacher’s Madhouse location as well as the exclusive rights to the United Kingdom, South Africa and Australia. | |||||||||||||||||||||
Based on the current status of this investment, the Company does not consider the investment to be impaired. | |||||||||||||||||||||
EE Investors, LLC - On January 26, 2006, we acquired an investment in EE Investors, LLC with cash in the amount of $250,000. We acquired 1,205 units (3.378%) in EE Investors, LLC, whose sole asset is 40% of Edison Nation, LLC (formerly Bouncing Brain Productions, LLC). Edison Nation was formed to provide equity capital for new inventions and help bring them to market. The initial business plan included developing the products and working with manufacturers and marketing organizations to sell the products. This has evolved into a less hands-on program which involves selling products with patents to other larger companies and retaining royalties. Edison Nation has now reached cash flow break-even, and in addition has been retained by a number of companies for which they do product searches to supplement its business. Based on the current status of this investment, the Company does not consider the investment to be impaired. |
Discontinued_Operations
Discontinued Operations | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Discontinued Operations and Disposal Groups [Abstract] | |||||||||
Discontinued Operations | 5. DISCONTINUED OPERATIONS | ||||||||
During 2013, the Company discontinued the operations of Chanticleer Investors II and Chanticleer Investment Partners, LLC and had no results of operations or cash flows from those operations in 2014. | |||||||||
On December 31, 2014, management concluded it was in the best interest of the Company to exit the Spoon business, whereby the Company executed an Asset Purchase Agreement to sell the assets of Spoon Bar & Kitchen back to the original owner. In connection with the sale of Spoon, the Company reacquired 185,000 Stock Units that had been issued at acquisition in exchange for the asset transferred pursuant to the Asset Purchase Agreement. The stock was valued at $446,050 and the net assets were valued at $1,109,062, resulting in a loss of $683,012. | |||||||||
The results of operations and related non-recurring costs associated with Spoon have been presented as discontinued operations. Additionally, the assets and liabilities of the discontinued operations have been segregated in the accompanying consolidated balance sheets. | |||||||||
The operating results from the discontinued operations for the years ended December 31, 2014 and 2013 consisted of the following: | |||||||||
2014 | 2013 | ||||||||
Total revenue | $ | 1,207,688 | $ | 53,710 | |||||
Total operating expenses | 1,445,636 | 78,925 | |||||||
Non-cash charge on disposal of Spoon | 683,012 | - | |||||||
Net loss from discontinued operations | $ | (920,960 | ) | $ | (25,215 | ) | |||
As of December 31, 2014, liabilities from discontinued operations totaled $177,393. The Company did not retain any assets related to the discontinued operation. |
Property_and_Equipment
Property and Equipment | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Property, Plant and Equipment [Abstract] | |||||||||
Property and Equipment | 6. PROPERTY AND EQUIPMENT | ||||||||
Property and equipment consists of the following at December 31, 2014 and 2013: | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Leasehold improvements | $ | 9,940,517 | $ | 4,303,548 | |||||
Restaurant furniture and equipment | 7,827,925 | 2,413,118 | |||||||
Construction in progress | 727,934 | - | |||||||
Office and computer equipment | 51,746 | 50,780 | |||||||
Land and buildings | 437,223 | - | |||||||
Office furniture and fixtures | 60,302 | 47,686 | |||||||
19,045,647 | 6,815,132 | ||||||||
Accumulated depreciation and amortization | (5,730,238 | ) | (1,194,943 | ) | |||||
$ | 13,315,409 | $ | 5,620,189 | ||||||
Restaurant furnishings and equipment includes assets under capital leases from our South African restaurants $179,320 and $263,392, net book value of $59,261 and $158,446 as of December 31, 2014 and December 31, 2013, respectively. Depreciation and amortization expense $74,204 and $78,742 for capital lease assets for the year ended December 31, 2104 and 2013, respectively. |
Intangible_Assets_Net
Intangible Assets, Net | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||
Intangible Assets, Net | 7. INTANGIBLE ASSETS, NET | ||||||||||||
GOODWILL | |||||||||||||
Goodwill is summarized by location as follows: | |||||||||||||
December 31, | |||||||||||||
Goodwill | 2014 | 2013 | |||||||||||
South Africa | $ | 273,737 | $ | 396,487 | |||||||||
ARB | 2,806,990 | 2,550,611 | |||||||||||
WEW | 2,868,192 | 3,124,507 | |||||||||||
Just Fresh | 425,151 | 425,151 | |||||||||||
Australia | 7,291,329 | - | |||||||||||
Hootres Pacific NW | 1,951,909 | - | |||||||||||
Total | $ | 15,617,308 | $ | 6,496,756 | |||||||||
The changes in the carrying amount of goodwill are summarized as follows: | |||||||||||||
2014 | 2013 | ||||||||||||
Beginning Balance | $ | 6,496,756 | $ | 396,487 | |||||||||
Acquisitions | 11,394,009 | 6,135,262 | |||||||||||
Divestures | (698,583 | ) | - | ||||||||||
Goodwill adjustments | (169,000 | ) | - | ||||||||||
Foreign currency translation | (1,405,874 | ) | (34,993 | ) | |||||||||
Ending Balance | $ | 15,617,308 | $ | 6,496,756 | |||||||||
An evaluation was completed effective December 31, 2014 at which time the Company determined that no impairment was necessary for any of the Company’s goodwill balances. | |||||||||||||
OTHER INTANGIBLE ASSETS | |||||||||||||
Franchise cost for the Company’s Hooters restaurants and trademark/trade name for the Company’s Just Fresh and American Roadside Burger entities consists of the following at December 31, 2014 and December 31, 2013. The Company is amortizing these franchise costs from the opening of each restaurant for the 20 year term of the franchise agreement with HOA and the trademark/trade name over its estimated 10 year useful lives. | |||||||||||||
December 31, | |||||||||||||
Intagible assets | 2014 | 2013 | |||||||||||
Franchise fees: | |||||||||||||
South Africa | $ | 290,986 | $ | 448,888 | |||||||||
Europe | 106,506 | 106,506 | |||||||||||
Australia | 383,529 | - | |||||||||||
Hootres Pacific NW | 59,186 | - | |||||||||||
Brazil * | 135,000 | 135,000 | |||||||||||
975,207 | 690,394 | ||||||||||||
Trademark, Tradenames: | |||||||||||||
Just Fresh | 1,010,000 | 1,010,000 | |||||||||||
American Roadside Burger | 1,783,954 | 1,784,327 | |||||||||||
2,793,954 | 2,794,327 | ||||||||||||
Total Intagnibles at cost | 3,769,161 | 3,484,721 | |||||||||||
Accumulated amortization | (372,658 | ) | (60,089 | ) | |||||||||
Intangible assets, net | $ | 3,396,503 | $ | 3,424,632 | |||||||||
Amortization expense | $ | 308,412 | $ | 21,349 | |||||||||
* Amortization of the Brazil franchise cost will begin with the opening of a restaurant in that market. | |||||||||||||
Amortization for franchise costs and trade name/trademarks are as follows: | |||||||||||||
Franchise fees | Trademark / Tradenames | Total | |||||||||||
December 31, | |||||||||||||
2015 | $ | 61,590 | $ | 279,432 | $ | 341,022 | |||||||
2016 | 61,590 | 279,432 | 341,022 | ||||||||||
2017 | 61,590 | 279,432 | 341,022 | ||||||||||
2018 | 61,590 | 279,432 | 341,022 | ||||||||||
2019 | 61,590 | 279,432 | 341,022 | ||||||||||
Thereafter | 438,462 | 1,117,931 | 1,556,393 | ||||||||||
Total | 746,412 | 2,515,091 | 3,261,503 |
LongTerm_Debt_and_Notes_Payabl
Long-Term Debt and Notes Payable | 12 Months Ended | ||||||
Dec. 31, 2014 | |||||||
Debt Disclosure [Abstract] | |||||||
Long-Term Debt and Notes Payable | 8. LONG-TERM DEBT AND NOTES PAYABLE | ||||||
Long-term debt and notes payable are summarized as follows. | |||||||
December 31, | |||||||
2014 | 2013 | ||||||
Note payable to a bank due in monthly installments of $4,406 including interest at Wall Street Journal Prime plus 1% (minimum of 5.5%); remaining balance due October 10, 2018; collateralized by substantially all of the Company’s assets and guaranteed by an officer of the Company | (a) | $ | 176,731 | $ | 218,119 | ||
Line of credit to a bank, expires May 10. 2015, interest rate of Wall Street Journal Prime (3.25% as of December 31, 2014) plus 1%, floor rate of 5% | (b) | 500,000 | 472,000 | ||||
Note payable to a bank due interest only at a 5% rate; balloon principal payment due June 10, 2019; collateralized by substantially all of the Company’s assets and guaranteed by an officer of the Company | (c) | 500,000 | - | ||||
Note payable to a bank, matured and paid in full August 5, 2014, interest rate of Wall St. Journal Prime plus 1% | (d) | - | 38,614 | ||||
Loan agreement with an outside company on December 23, 2013, interest at 1% per month, accrued interest and principal originally due February 23, 2014, unsecured. Loan was repaid in full in early 2015 | (e) | 100,000 | 150,000 | ||||
Loan agreement with an outside company on June 20, 2014, interest at 8% annual rate, accrued interest and principal oriinally due July 11, 2014, unsecured. Loan was repaid in full in ealry 2015 | (f) | 100,000 | - | ||||
Mortage loan dated April, 2014, interest ar South African prime rate + 2.6% (11.85% as of December 31, 2014); due July 31, 2024; secured by a bond on all assets at our Port Elizabeth, South Africa location and partially guaranteed by our CEO and South African COO | (g) | 294,362 | - | ||||
Loan agreement with an outside company on July 1, 2014, interest at 12% annual rate, secured by certain secured assets and gaming revenue of the Australian entities, net of discount of $343,733; matures January 31, 2017 | (h) | 4,656,267 | - | ||||
Bank overdraft facilities; unsecured; maximum facilities $260,000; interest rate 11% at December 31, 2014, with annual renewal each December. | (i) | 151,868 | 79,372 | ||||
Term facility with monthly payments of 45,288 Rand, including interest at South African Prime - 1.0% (10.25% as of December 31, 2014); due June 14, 2016 | (j) | 64,309 | 133,448 | ||||
Term facility with monthly payments of 44,727 Rand including interest at South Afican Prime + 3.0% (12.25% as of December 31, 2014); due November 15, 2019. | (k) | 170,053 | - | ||||
Term facility with monthly payments of 33,750 Rand, including interest at South Afican Prime + 3.0% (12.25% as of December 31, 2014); due December 1, 2018. | (l) | 109,340 | 142,807 | ||||
Total | $ | 6.822,930 | $ | 1,234,360 | |||
Current portion of long-term debt | 1,813,647 | 835,454 | |||||
Long-term debt, less current portion | $ | 5,009,283 | $ | 398,906 | |||
(a) and (b) On April 11, 2013, the Company and Paragon Commercial Bank (“Paragon”) entered into a credit agreement (the “Credit Agreement”) which provides for a $500,000 revolving credit facility with a one-year term from the closing date. The Credit Agreement is available to be drawn at the Company’s discretion to finance investments in new business ventures and for the Company’s general corporate working capital requirements in the ordinary course of business. The note payable originally matured on August 10, 2013 and on November 4, 2013 the note was extended to October 10, 2018 with monthly principal and interest payments of $4,406, whereas the new credit facility (b) expires on May 10, 2015. Borrowings under the Credit Agreement bear monthly interest at the greater of: (i) floor rate of 5.00% or (ii) the Wall Street Journal’s prime plus rate (3.25% as of December 31, 2014) plus 1.00%. Any borrowings are secured by a lien on all of the Company’s assets. The obligations under the Credit Agreement are guaranteed by Mike Pruitt, the Company’s Chief Executive Officer. | |||||||
(c) During February 2014, the Company secured a note with Paragon for $500,000 due on June 10, 2019. The note bears interest at a 5% annual rate, interest only monthly payments until the maturity date. | |||||||
(d) ABC entered into a term note with TD Bank in 2008 for $300,000, which has been paid in full as of December 31, 2014. | |||||||
(e) On December 23, 2013, the Company entered into a loan agreement with an outside company for $150,000, originally due on February 23, 2014. Interest is compounded monthly at a rate of 1%. As of February 23, 2014, the Company was not in compliance with the terms of this note due to non-payment of principal and interest. On March 21 and August 20, 2014, the Company paid the note holder $25,000 each of principal and accrued interest. In March 2015, subsequent to the balance sheet date, the Company repaid the loan in full. | |||||||
(f) On June 20, 2014, the Company entered into a loan agreement with an outside company for $100,000, originally due on July 11, 2014. In March 2015, subsequent to the balance sheet date, the Company repaid the loan in full. | |||||||
(g) In April 2014, our South African subsidiary entered into a mortgage note with a South African bank for the purchase of the building in Port Elizabeth for our Hooters location. The 10-year note is for $330,220 with an annual interest rate of 2.6% above the South African prime rate (prime currently 9.25%). Monthly principal and interest payments of approximately $4,600 commenced in August, 2014. The mortgage note is personally guaranteed by our CEO and South African COO and secured by the assets of the Port Elizabeth building. | |||||||
(h) On July 1, 2014, pursuant to Purchase Agreements executed on June 30, 2014, the Company completed the acquisition of a sixty percent (60%) ownership interest in Hoot Parramatta Pty Ltd, Hoot Australia Pty Ltd, Hoot Penrith Pty Ltd, and TMIX Management Australia Pty Ltd (collectively, the “Australian Entities”), which own, operate, and manage Hooters restaurant locations and gaming operations in Australia. The ownership interest in the Australian Entities was purchased from the respective entities in exchange for the Company agreeing to assume a five million dollar ($5,000,000) debt bearing interest at 12% annually and issuing two hundred fifty thousand (250,000) warrants to purchase shares of our common stock. Originally principal repayments were as follows: $2,000,000 on December 31, 2014, $2,000,000 on June 30, 2015, and $1,000,000 on December 31, 2015. On October 15, 2014, principal repayments were restructured whereby $200,000 was due on December 31, 2014, $50,000 is payable each month from January 2015 through December 2015, $2,000,000 is payable January 31, 2016, $1,200,000 is payable on July 31, 2016 and the remaining $1,000,000 is due by January 31, 2017. The Company had not made the December 2014 payment as of the date of this report as the note holder and Company are discussing a potential modification to the loan agreement. Accordingly, the note holder has not issued any notice of default to the Company. | |||||||
(i) The Company’s South African subsidiary has local bank financing in the form of term and overdraft facilities totaling of approximately $151,868 and $79,372 outstanding as of December 31, 2014 and 2013, respectively. | |||||||
(j) The Company’s South African subsidiary has local bank financing in the form of a term loan with monthly payments of 45 thousand Rand, including interest at South African Prime +1.0%. The term loan matures on June 14, 2016. | |||||||
(k) The Company’s South African subsidiary has local bank financing in the form of a term loan with monthly payments of 44 thousand Rand, including interest South African Prime +3.0%. The term loan matures on November 15, 2019. | |||||||
(l) The Company’s South African subsidiary has local bank financing in the form of a term loan with monthly payments of 34 thousand Rand, including interest at South African Prime + 3.0%. The term loan matures on December 1, 2018. |
Convertible_Notes_Payable
Convertible Notes Payable | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Convertible Notes Payable [Abstract] | |||||||||||||||||
Convertible Notes Payable | 10. cONVERTIBLE NOTEs PAYABLE | ||||||||||||||||
December 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
6% Convertible notes payable issued in August 2013 | $ | 3,000,000 | $ | 3,000,000 | |||||||||||||
Discounts on above convertible note | (1,583,333 | ) | (2,583,333 | ) | |||||||||||||
15% Convertible notes payable issued in March 2014 | 500,000 | - | |||||||||||||||
Discounts on above convertible note | (63,730 | ) | - | ||||||||||||||
8% Convertible notes payable issued in Nov/Dec 2014 | 350,000 | - | |||||||||||||||
Discounts on above convertible note | (289,254 | ) | - | ||||||||||||||
1,913,683 | 416,667 | ||||||||||||||||
Current portion of convertible notes payable | (436,270 | ) | - | ||||||||||||||
Convertible notes payable, less current portion | $ | 1,477,413 | $ | 416.667 | |||||||||||||
On August 2, 2013, the Company entered into an agreement with seven individual accredited investors, whereby the Company issued separate 6% Secured Subordinate Convertible Notes for a total of $3,000,000 in a private offering and is collateralized by the assets of the Hooters Nottingham restaurant. The funding from the private offering was used exclusively for the acquisition of the Nottingham, England Hooters restaurant location (acquisition described in Note 3). The Notes have the following principal terms: | |||||||||||||||||
● | the principal amount of the Note shall be repaid within 36 months of the issuance date at a non-compounded 6% interest rate per annum; | ||||||||||||||||
● | the Note holders shall receive 10%, pro rata, of the net profit of the Nottingham, England Hooters restaurant, paid quarterly for the life of the location, and 10% of the net proceeds should the location be sold; | ||||||||||||||||
● | the consortium of investors received a total of 300,000) three-year warrants, exercisable at $3.00 per share; | ||||||||||||||||
● | the Note holder may convert his or her Note into shares of the Company’s common stock (at 90% of the average closing price ten days prior to conversion, unless a public offering is pending at the time of the conversion notice, which would result in the conversion price being the same price as the offering). The conversion price is subject to a floor of $1.00 per share; | ||||||||||||||||
● | the Note holder has the right to redeem the Note for a period of sixty days following the eighteen month anniversary of the issuance of the Note, unless a capital raise is conducted within eighteen months after the issuance of the Note. In connection with the issuance of the Note, the Company also issued warrants for the purchase of 300,000 shares of the Company’s common stock at an exercise price of $3.00 per share through August 2, 2016. | ||||||||||||||||
The Company completed the purchase of Hooters Nottingham on November 6, 2013 and began operating the restaurant on November 7, 2013. | |||||||||||||||||
The fair value of the embedded conversion feature and the warrants is $2,265,600 and $884,600, respectively, and the aggregated total equals $3,150,200. Consequently, upon issuance of the Note, a debt discount of $3,000,000 was recorded and the original difference of $150,200, representing the fair value of the conversion feature and the warrants in excess of the debt discount, was immediately charged to interest expense. The debt discount will be amortized over the earlier of (i) the term of the debt or (ii) conversion of the debt, using the straight-line method which approximates the interest method. The amortization of debt discount is included as a component of interest expense in the condensed consolidated statements of operations and comprehensive loss. | |||||||||||||||||
The expected stock price volatility for the Company’s stock options was determined by the historical volatilities of comparable companies. Risk free interest rates were obtained from U.S. Treasury rates for the applicable periods. | |||||||||||||||||
The conversion price of the note is the 90% average price for the last 10 days of trading activity. As of the inception date of the note the shares issuable under the terms of the note were 804,764 shares or an effective conversion price of approximately $3.73 per share. The fair value of the shares as of August 2, 2013 using the Black-Scholes option pricing model was approximately $2.82 per share. On December 31, 2013 the stock price increased to $5.37 per share and the 90% average price for the last 10 days of trading activity was $4.71. The increase in the conversion price effectively decreased the number of shares that would be required to settle the contract by 161,172 shares to 637,592 shares as of December 31, 2013. | |||||||||||||||||
In March 2014, the Company entered into an agreement whereby the Company issued a convertible promissory note for a total of $500,000. The note accrues monthly interest of 1.25% until the date the note is converted. The note is convertible into the Company’s common stock (at 85% if the offering price in future offering or 85% of the Volume Weighted Average Price (“VWAP”). The conversion price is subject to a floor of $3.00 per share. If not converted, the note matures one year from the issuance date. | |||||||||||||||||
In connection with the issuance of the March 2014 convertible promissory note, the Company also issued to the investors warrants to purchase up to 30% of the number of shares of common stock issued upon conversion of the 2014 note, exercisable at $5.25 per share for a period of up to 5 years from the note’s original issuance date. | |||||||||||||||||
During November and December 2014, the Company entered into agreements whereby the Company issued 3-year convertible notes in the amounts of $250,000 and $100,000, respectively. The notes accrue annualized interest of 8% until the date the notes are converted. The note is convertible into the Company’s common stock (at 85% of lowest three (3) trading prices for the common stock during the ten (10) trading day period ending on the last complete Trading Day prior to the Conversion Date. The Company also issued 5 year warrants of 62,500 and 25,000, respectively, with an exercise price of $2.50 per share. | |||||||||||||||||
The Company accounted for the issuance of the convertible promissory note and the warrants attached to the note in accordance with ASC 815 “Derivatives and Hedging.” Accordingly, the warrants and the embedded conversion option of the convertible notes are recorded as derivative liabilities at their fair market value and are marked to market through earnings at the end of each reporting period. The gross proceeds from the sale of the note are recorded net of a discount of $292,700. The debt discount relates to the beneficial conversion feature embedded in the conversion option and the fair value of the warrants attached to the notes. The debt discount is charged back to interest expense ratably over the term of the convertible note. | |||||||||||||||||
The fair value of the embedded conversion feature and the warrants each was estimated using the Black-Scholes option-pricing model which approximated the Binomial Lattice model. The model includes subjective input assumptions that can materially affect the fair value estimates. The Company determined the fair value of the Binomial Lattice Model and the Black-Scholes Valuation Model to be materially the same. The expected stock price volatility for the Company’s warrants was determined by the historical volatilities for industry peers and used an average of those volatilities. The risk free interest rate was obtained from U.S. Treasury rates for the applicable periods. The contractual terms of the agreement does not provide for and the Company does not expect to declare dividends in the near future. Key assumptions used to apply this pricing model as of the date of issuance and December 31, 2014 are presented in the table below: | |||||||||||||||||
2-Aug-13 | 19-Mar-14 | 19-Nov-14 | 16-Dec-14 | ||||||||||||||
Common stock closing price | $ | 4.15 | $ | 3.87 | $ | 1.7 | $ | 1.53 | |||||||||
Conversion per share price | $ | 3.73 | $ | 3.29 | $ | 1.45 | $ | 1.3 | |||||||||
Conversion shares | 804,764 | 151,999 | 172,672 | 77,061 | |||||||||||||
Expected life (in years) | 3 | 1 | 3 | 3 | |||||||||||||
Expected volatility | 109.55 | % | 62.03 | % | 74.28 | % | 74.28 | % | |||||||||
Call option value | $ | 2.82 | $ | 1.19 | $ | 0.9 | $ | 0.81 | |||||||||
Risk-free interest rate | 0.59 | % | 0.15 | % | 1.1 | % | 1.1 | % | |||||||||
Dividends | 0 | % | 0 | % | 0 | % | 0 | % | |||||||||
31-Dec-14 | 31-Dec-14 | 31-Dec-14 | 31-Dec-14 | ||||||||||||||
Common stock closing price | $ | 1.73 | $ | 1.73 | $ | 1.73 | $ | 1.73 | |||||||||
Conversion per share price | $ | 1.49 | $ | 1.47 | $ | 1.26 | $ | 1.26 | |||||||||
Conversion shares | 2,008,032 | 340,020 | 199,177 | 77,061 | |||||||||||||
Expected life (in years) | 1.6 | 0.2 | 2.9 | 3 | |||||||||||||
Expected volatility | 63.72 | % | 65.63 | % | 74.28 | % | 74.28 | % | |||||||||
Call option value | $ | 0.64 | $ | 0.35 | $ | 0.77 | $ | 0.78 | |||||||||
Risk-free interest rate | 0.67 | % | 0.4 | % | 1.1 | % | 1.1 | % | |||||||||
Dividends | 0 | % | 0 | % | 0 | % | 0 | % |
Capital_Leases_Payable
Capital Leases Payable | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Capital Lease Obligations [Abstract] | |||||||||
Capital Lease Obligations | 11. Capital Leases Payable | ||||||||
Capital leases payable at December 31, 2014 and 2013 is associated with the South African operations and consists of the following: | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Capital lease payable, bearing interest at 10%. through August 2017 | $ | 10,502 | $ | 28,589 | |||||
Capital lease payable, bearing interest at 10%. through November 2014 | - | 8,627 | |||||||
Capital lease payable, bearing interest at 11.5%, through July 2016 | 26,489 | 46,721 | |||||||
Capital lease payable, bearing interest at 11.5%, through November 2016 | 40,336 | 66,354 | |||||||
Capital lease payable, bearing interest at 10%, through March 2015 | 1,333 | 14,789 | |||||||
Total capital leases payable | 78,660 | 165,080 | |||||||
Current maturities | 42,032 | 59,162 | |||||||
Capital leases payable, less current maturities | $ | 36,628 | $ | 105,918 | |||||
The current capital leases cover point of sale and other equipment for five of the South African restaurants. Annual requirements for capital lease obligations are as follows: | |||||||||
December 31, | Amount | ||||||||
2015 | $ | 48,899 | |||||||
2016 | 37,491 | ||||||||
2017 | 3,189 | ||||||||
Total minimum lease payments | 89,579 | ||||||||
Less: amount representing interest | 10,919 | ||||||||
Present Value of Net Minimum Lease Payments | $ | 78,660 |
Accounts_Payable_and_Accrued_E
Accounts Payable and Accrued Expenses | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Disclosure Text Block [Abstract] | |||||||||
Accounts Payable and Accrued Expenses | 12. ACCOUNTS PAYABLE AND ACCRUED Expenses | ||||||||
Accounts payable and accrued expenses are summarized as follows: | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Accounts payable | $ | 3,382,818 | $ | 1,673,933 | |||||
Accrued taxes (VAT, GST, Sales Payroll) | 1,604,829 | 636,568 | |||||||
Accrued income taxes | 92,618 | 15,776 | |||||||
Accrued interest | 499,866 | 97,384 | |||||||
$ | 5,580,131 | $ | 2,423,661 |
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||
Income Taxes | 13. INCOME TAXES | ||||||||||||
The breakout of the loss from continuing operations before income taxes between domestic and foreign operations is below: | |||||||||||||
2014 | 2013 | ||||||||||||
Loss from continuing operations before income taxes | |||||||||||||
United States | $ | 5,442,499 | $ | 4,650,443 | |||||||||
Foreign | 759,875 | 636,651 | |||||||||||
$ | 6,202,374 | $ | 5,287,094 | ||||||||||
The Income Tax (benefit) provision consists of the following: | |||||||||||||
Foreign | |||||||||||||
Current | $ | 55,486 | $ | 40,935 | |||||||||
Deferred | (267,960 | ) | (167,554 | ) | |||||||||
U.S. Federal | |||||||||||||
Current | 318 | - | |||||||||||
Deferred | (1,266,980 | ) | (652,624 | ) | |||||||||
State & Local | |||||||||||||
Current | - | - | |||||||||||
Deferred | (149,056 | ) | (76,786 | ) | |||||||||
Change in Valuation Allowance | 1,151,691 | 896,964 | |||||||||||
$ | (476,501 | ) | $ | 40,935 | |||||||||
The (benefit) provision for income tax using statutory U.S. federal tax rate is reconciled to the company’s effective tax rate as follows: | |||||||||||||
2014 | 2013 | ||||||||||||
Computed “expected” income tax benefit | $ | (2,093,584 | ) | $ | (1,797,612 | ) | |||||||
State income taxes, net of federal benefit | (205,177 | ) | (211,484 | ) | |||||||||
Foreign rate differential | 45,883 | (79,399 | ) | ||||||||||
Prior year deferred tax adjustment | - | 1,083,075 | |||||||||||
Prior year true-ups other deferred tax balances | 106,236 | - | |||||||||||
Travel, entertainment, and other | 91,045 | 537,988 | |||||||||||
Deferred taxes from acquisitions | - | (388,597 | ) | ||||||||||
Fixed asset DTL true-up | 305,796 | - | |||||||||||
Other | 121,609 | - | |||||||||||
Change in valuation allowance | 1,151,691 | 896,964 | |||||||||||
Effective Rate | $ | (476,501 | ) | $ | 40,935 | ||||||||
The Company has significant permanent book tax differences related to derivative liabilities with a convertible debt feature. | |||||||||||||
Deferred income taxes reflect the net tax effect of temporary differences between the carrying amounts of assets and liabilities for financial reporting and the amounts used for tax purposes. Major components of deferred tax assets at December 31, 2014 and 2013 were: | |||||||||||||
2014 | 2013 | ||||||||||||
Net operating loss carryovers | $ | 6,773,713 | $ | 4,495,059 | |||||||||
Capital loss carryforwards | 488,500 | 488,500 | |||||||||||
Investments | (84,384 | ) | - | ||||||||||
Derivative liability | 372,931 | 645,500 | |||||||||||
Warrants | - | 184,800 | |||||||||||
Australian equity investment | (26,417 | ) | 53,132 | ||||||||||
Deferred occupancy liabilities | 388,114 | 378,521 | |||||||||||
Total deferred Tax Assets | 7,912,457 | 6,245,512 | |||||||||||
Property and equipment | (469,986 | ) | (278,868 | ) | |||||||||
Convertible debt | (372,931 | ) | (645,500 | ) | |||||||||
Intangibles | (957,229 | ) | (1,061,844 | ) | |||||||||
Goodwill | (47,492 | ) | - | ||||||||||
Total deferred tax liabilities | (1,847,638 | ) | (1,986,212 | ) | |||||||||
Net deferred tax assets | 6,064,819 | 4,259,300 | |||||||||||
Valuation Allowance | (6,751,703 | ) | (5,600,012 | ) | |||||||||
$ | (686,884 | ) | $ | (1,340,712 | ) | ||||||||
As of December 31, 2014 and 2013, the company has U.S. federal and state net operating loss carryovers of approximately $15,660,000 and $10,666,000 respectively, which will expire at various dates beginning in 2031 through 2035, if not utilized. As of December 31, 2014 and 2013 the company has foreign net operating loss carryovers of $2,751,000 ($735,000 for Hungary, $1,735,000 for South Africa, and $281,000 for Australia) and $1,727,000 ($464,000 for Hungary and $1,263,000 for South Africa) respectively. These net operating loss carryovers can be carried forward indefinitely as long as the company is trading. The company has a capital loss carryforward of $1,286,000 which expires between 2015 and 2017 if not utilized. In accordance with Section 382 of the internal revenue code, deductibility of the company’s U.S. net operating loss carryovers may be subject to an annual limitation in the event of a change of control as defined under the Section 382 regulations. Quarterly ownership changes for the past 3 years were analyzed and it was determined that there was no change of control as of December 31, 2014. | |||||||||||||
In assessing the realization of deferred tax assets, Management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. After consideration of all of the information available, Management believes that significant uncertainty exists with respect to future realization of the deferred tax assets and has therefore established a full valuation allowance. For the year ended December 31, 2014 and December 31, 2013 the change in valuation allowance was approximately $1,151,691 and $896,964, respectively. | |||||||||||||
The company evaluated the provisions of ASC 740 related to the accounting for uncertainty in income taxes recognized in their financial statements. ASC 740 prescribes a comprehensive model for how a company should recognize, present, and disclose uncertain positions that the company has taken or expects to take in its return. For those benefits to be recognized, a tax position must be more-likely-than- not to be sustained upon examination by taxing authorities. Differences between two positions taken or expected to be taken in a tax return and the benefit recognized and measured pursuant to the interpretation are referred to as “unrecognized benefits”. A liability is recognized for an unrecognized tax benefit because it represents an enterprise’s potential future obligation to the taxing-authority for a tax position that was not recognized as a result of applying the provisions of ASC 740. | |||||||||||||
The company’s uncertain tax positions for December 31, 2014 and 2013 are as follows: | |||||||||||||
Unrecognized | Interest and | ||||||||||||
Tax Benefit | Penalties | Total | |||||||||||
Balance at December 31, 2013 | $ | - | $ | - | $ | - | |||||||
Increases related to prior year tax positions | 419,301 | - | 419,301 | ||||||||||
Decreases related to prior year tax positions | - | - | - | ||||||||||
Increases related to current year tax positions | - | - | - | ||||||||||
Settlements during the period | - | - | - | ||||||||||
Lapse of statute of limitations | - | - | - | ||||||||||
Balance at December 31, 2014 | $ | 419,301 | $ | - | $ | 419,301 | |||||||
The company expects the liability related to uncertain tax positions to decrease by $419,301 within the next 12 months. | |||||||||||||
Interest related to uncertain tax positions are required to be calculated, if applicable, and would be classified as “interest expense” in the two statements of operations. Penalties would be recognized as a component of “general and administrative expenses”. As of December 31, 2014 and 2013 no interest or penalties were required to be reported. The 2013 NOL was adjusted for the uncertain tax position and is sufficient to absorb the full amount. | |||||||||||||
No provision was made for U.S. or foreign taxes on approximately $515,000 of undistributed earnings of the Company as such earnings are considered to be permanently reinvested. Such earnings have been, and will continue to be, reinvested, but could become subject to additional tax if they were remitted as dividends, loaned to the Company, or if the Company should sell its interests in the foreign entities. It is not practicable to determine the amount of additional tax, if any, that might be payable on the undistributed earnings. |
Stockholders_Equity
Stockholders' Equity | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Stockholders' Equity Note [Abstract] | |||||||||||||
Stockholders' Equity | 14. STOCKHOLDERS’ EQUITY | ||||||||||||
On February 3, 2014, the Company amended its certificate of incorporation to increase the number of its authorized shares of common stock from 20,000,000 shares to 45,000,000 shares. | |||||||||||||
The Company’s shareholders have approved the Chanticleer Holdings, Inc. 2014 Stock Incentive Plan (the “2014 Plan”), authorizing the issuance of options, stock appreciation rights, restricted stock awards and units, performance shares and units, phantom stock and other stock-based and dividend equivalent awards. Pursuant to the approved 2014 Plan, 4,000,000 shares remained available for future grant as of December 31, 2014. | |||||||||||||
2014 Transactions | |||||||||||||
During December 2014, the Company issued the following common stock shares and warrants: | |||||||||||||
● | 11,101 shares of the Company’s common stock at $2.00 and 3,330 common stock warrants at an exercise price of $3.50 for $22,202; | ||||||||||||
● | 20,750 shares of the Company’s common stock at $2.00 and 6,225 common stock warrants at an exercise price of $3.50 for payment of accounts payable for consulting services totaling $41,500; | ||||||||||||
● | 54,837 shares of the Company’s common stock for payment of accounts payable for consulting services totaling $$108,855 at prices ranging from $1.79 to $2.07; | ||||||||||||
● | 36,667 shares of the Company’s common stock at $1.80 for payment of Board of Directors fees totaling $66,000; | ||||||||||||
● | 67,807 shares of the Company’s common stock at $2.00 per share for accrued interest totaling $135,614; | ||||||||||||
● | 14,451 shares of the Company’s common stock at $1.73 for payment of an employee contractual bonus totaling $25,000. | ||||||||||||
During November 2014, the Company issued $175,000 of the Company’s common stock (87,500 shares at $2.00 per share) in satisfaction of past-due interest and 26,250 common stock warrants at $3.50 per share exercise price in consideration for the debt restructuring related to Hooters Australia. | |||||||||||||
During October 2014, the Company re-priced certain warrants with an original exercise price of $5.50 and $7.00 to $2.00, subject to immediate cash exercise. The Company received $349,544 of funds related to this transaction. | |||||||||||||
During the three months ended September 30, 2014, the Company raised from private investors $641,000 for the sale of 320,500 shares of common stock, and accompanying sales of 96,150 5-year common stock warrants exercisable at $3.50 per share. | |||||||||||||
On September 9, 2014, the Company purchased 100% of the net assets of The Burger Company located in Charlotte, North Carolina, a similar concept to our ABC restaurants, for a purchase price of $550,000, which consisted of $250,000 in cash and $300,000 (146,628 shares) in the Company’s common stock. | |||||||||||||
During the six months ended June 30, 2014, the Company issued an aggregate of 40,000 and 98,764 shares of the Company’s common stock, valued at $101,900 and $330,757 to several investor relations firms in exchange for investor relations services provided to the Company. | |||||||||||||
During the six months ended June 30, 2014, the Company raised from private investors $200,000 for 137,500 shares of common stock and 15,000 five-year common stock warrants exercisable at $3.50 per share. | |||||||||||||
On March 19, 2014, the Company received $500,000 from the issuance of convertible debt to one investor, and the proceeds were used for continuing the Company’s growth and for working capital purposes. The Company issued 15% Secured Subordinate Convertible Notes and five-year warrants, at a price of $5.25 per share, to purchase up to 30% of the number of shares of Company common stock issuable upon conversion of the 2014 note. | |||||||||||||
During the first three months of 2014, the Company issued an aggregate of 58,764 shares of the Company’s common stock, valued at $228,857 to several investor relations firms in exchange for investor relations services provided to the Company. | |||||||||||||
On January 31, 2014, we issued 680,272 Company units in connection with the acquisitions of Pacific NW. Each unit consisted of one share of our common stock and one five-year warrant to purchase a share of our common stock. Half (340,136) of the warrants are exercisable at $5.50 and half (340,136) of the warrants are exercisable at $7.00. As part of this transaction, the Hooters Sellers were granted registration rights with respect to our common stock issued and underlying the warrants, and franchise rights and leasehold rights to the locations were transferred to the Company. | |||||||||||||
On January 31, 2014, we issued 195,000 Company units in connection with the acquisition of Spoon. Each unit consisted of one share of the Company’s common stock and one five-year warrant to purchase a share of the Company’s common stock. Half (97,500) of the warrants are exercisable at $5.50 and half (97,500) of the warrants are exercisable at $7.00. As part of this transaction, EWC was granted registration rights with respect to our common stock issued and underlying the warrants, and all leaseholds and other rights were transferred to the Company. (See Note 5 “Discontinued Operations”). | |||||||||||||
2013 Transactions | |||||||||||||
On April 22, 2013, the Company issued 4,000 shares of the Company’s common stock in exchange for investor relations services to be performed over a 12 month period, valued at $7,720. | |||||||||||||
In September 2013, the Company issued 25,000 shares of common stock valued at $117,000 for services for a five month agreement. The Company has expensed $93,600, representing four of five months in 2013 and will expense the final month in 2014. | |||||||||||||
On September 30, 2013, the Company closed the purchase of ABC and issued 740,000 units which consisted of one share of common stock and one common stock warrant valued at $3,611,126 and $1,710,077, respectively. | |||||||||||||
On October 17, 2013, the Company raised $2,500,000 in a private placement, pursuant to which the Company sold to the Investors an aggregate of 666,667 Units at a purchase price of $3.75 per Unit. Each Unit consists of one share of the Company’s common stock, $0.001 par value per share and one five-year warrant, exercisable after twelve months, to purchase one share of common stock at an initial exercise price of $5.00. | |||||||||||||
The Company employed a placement agent for the purpose of the Private Placement, and has paid to the Placement Agent commissions in the total amount of $150,000 and five year warrants convertible into an aggregate of 80,000 shares valued at approximately $312,000 using the Black-Scholes model. | |||||||||||||
During October 2013, 15,000 common stock shares valued at $62,500 were issued for services. | |||||||||||||
On November 5, 2013, the Company entered into a Subscription Agreement with JF Restaurants, L.L.C. (“JFR”) and JF Franchising Systems, L.L.C. (“JFFS”), for the purchase of a 51% ownership interest in each entity, for a total purchase price of $560,000. The purchase was finalized on December 10, 2013. On December 11, 2013, the Company purchased an additional 5% interest in both JFR and JFFS from an original interest holder for the total purchase price of $30,000, increasing the Company’s ownership interest in JFR and JFFS to a total of 56%. | |||||||||||||
On November 7, 2013, the Company entered into a Subscription Agreement with three accredited investors, pursuant to which the Company sold to the Investors an aggregate of 160,000 Units at a purchase price of $5.00 per Unit, closing an $800,000 private placement. The aggregate purchase price we received from the sale of the Units was $800,000. Each Unit consists of one share of the Company’s common stock, $0.001 par value per share and one five-year warrant to purchase one share of common stock. One half (80,000) of the available warrants are available at an initial exercise price of $5.50, while the remaining half (80,000) of the warrants are available at an initial exercise price of $7.00. The Company has paid a placement fee by issuing an aggregate of 80,000 five- year warrants valued at approximately $312,000 using the Black-Scholes model. | |||||||||||||
On November 26, 2013, the Company finalized a Subscription Agreement (the “Beacher’s Subscription Agreement”) with Beacher’s LV, LLC (“Beacher’s”), whereby the Company subscribed for five (5) Units, with each Unit consisting of a one percent (1%) membership interest in Beacher’s. The total capital contribution made by the Company to Beacher’s was $500,000. In connection with the Beacher’s Subscription Agreement, the Company executed a Right to Purchase Agreement with Madhouse Worldwide Investments, LLC (“MWI”) whereby the Company shall issue fifty three thousand three hundred and thirty four (53,334) shares of the Company’s common stock, valued at approximately $260,000, to MWI or its assigns, in exchange for a two-year option to purchase up to twenty five percent (25%) of any ownership interest in any future Beacher’s nightclub to be offered to third party investors, and a three-year exclusive option to propose funding, participate in funding, and open future Beacher’s nightclubs in South Africa, Australia, and the United Kingdom. The Company also issued an aggregate of 50,000 five-year warrants valued at approximately $176,000 using the Black-Scholes model. | |||||||||||||
Options and Warrants | |||||||||||||
There are no options outstanding as of December 31, 2014 and 2013. | |||||||||||||
Fair value of any warrant issuances are valued utilizing the Black-Scholes mode. The model includes subjective input assumptions that can materially affect the fair value estimates. The Company determined the fair value of the Binomial Lattice Model and the Black-Scholes Valuation Model to be materially the same. The expected stock price volatility for the Company’s warrants was determined by the historical volatilities for industry peers and used an average of those volatilities. | |||||||||||||
A summary of the warrant activity during the years ended December 31, 2014 and 2103 is presented below: | |||||||||||||
Number of | Weighted | Weighted | |||||||||||
Average Exercise | Average | ||||||||||||
Warrants | Price | Remaining Life | |||||||||||
Outstanding January 1, 2013 | - | $ | - | ||||||||||
Granted | 5,501,458 | 5.46 | |||||||||||
Exercised | - | ||||||||||||
Forfeited | - | ||||||||||||
Outstanding December 31, 2013 | 5,501,458 | 5.46 | |||||||||||
Granted | 3,584,118 | 4.97 | |||||||||||
Exercised | (174,772 | ) | 2 | ||||||||||
Forfeited | (195,000 | ) | 6.25 | ||||||||||
Outstanding December 31, 2014 | 8,715,804 | $ | 5.49 | 3 | |||||||||
Exercisable December 31, 2014 | 8,715,804 | $ | 5.49 | 3 | |||||||||
The following table presents information related to stock warrants as of December 31, 2014: | |||||||||||||
Weighted | |||||||||||||
Outstanding | Average | Exercisable | |||||||||||
Number of | Remaining Life | Number of | |||||||||||
Exercise Price | Warrants | in Years | Warrants | ||||||||||
>$5.00 | 3,554,514 | 2.8 | 3,554,514 | ||||||||||
$4.00-$5.00 | 3,935,117 | 3 | 3,935,117 | ||||||||||
$3.00-$4.00 | 963,901 | 4 | 963,901 | ||||||||||
$2.00-$3.00 | 262,272 | 3 | 262,272 | ||||||||||
8,715,804 | 8,715,804 | ||||||||||||
Warrant amortization is summarized as follows at December 31, 2014 and 2013 and for the years then ended: | |||||||||||||
2014 | 2013 | ||||||||||||
Additional paid-in capital | $ | 1,107,893 | $ | 657,552 | |||||||||
Interest expense | 336,798 | 22,659 | |||||||||||
Consulting expense | 771,095 | 634,893 | |||||||||||
$ | 1,107,893 | $ | 657,552 |
Related_Party_Transactions
Related Party Transactions | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Related Party Transactions [Abstract] | |||||||||
Related Party Transactions | 15. RELATED PARTY TRANSACTIONS | ||||||||
Due to related parties | |||||||||
The Company has received non-interest bearing loans and advances from related parties. The amounts owed by the Company as of December 31, 2014 and 2013 are as follows: | |||||||||
2014 | 2013 | ||||||||
Hoot SA I, LLC | $ | 12,196 | $ | 12,191 | |||||
Hooters Australia Partner | 1,087,451 | - | |||||||
Chanticleer Investors, LLC | 199,436 | - | |||||||
$ | 1,299,083 | $ | 12,191 | ||||||
At December 31, 2014 the Company has an outstanding loan payable to its Australian partner of $1,087,457 in connection with Surfers Paradise and Townsville construction costs. | |||||||||
Due from related parties | |||||||||
The Company has earned income from and made advances to related parties. The amounts owed to the Company at December 31, 2014 and 2013 is as follows: | |||||||||
2014 | 2013 | ||||||||
Chanticleer Dividend Fund, Inc. | $ | - | $ | 69,281 | |||||
Chanticleer Investors | - | 1,207 | |||||||
Hoot SA II, III, IV LLC | 46,015 | 45,817 | |||||||
$ | 46,015 | $ | 116,305 | ||||||
Management income from affiliates | |||||||||
Chanticleer Investors LLC | |||||||||
During 2011, Investors LLC collected its note receivable and reinvested $3,550,000 in HOA LLC (See Note 4). There was no management income from Investors LLC in 2014 or 2013. | |||||||||
Chanticleer Investors II LLC | |||||||||
The Company managed Investors II and the operations were discontinued in 2013. | |||||||||
Chanticleer Dividend Fund, Inc. (“CDF”) | |||||||||
On November 10, 2010 the Company formed CDF under the general corporation laws of the State of Maryland. CDF filed a registration statement under Form N-2 to register as a non-diversified, closed-end investment company in January 2011. During 2014, management reviewed the operations of CDF. CDF intends to dissolve the entity in 2015. The Company wrote off its related party balance in 2014. | |||||||||
Hoot SA, LLC; Hoot SA II, LLC; Hoot SA III, LLC and Hoot SA IV, LLC | |||||||||
The Hoot partnerships were formed to help finance the first four Hooters restaurants in South Africa. | |||||||||
North American Energy Resources, Inc. (“NAEY”) | |||||||||
The Company’s CEO became CEO and a director of NAEY during 2010 and the Company received 150,000 common shares for management services. The shares were valued at $10,500, based on the trading price of NAEY at the time. The Company’s CEO resigned as CEO of NAEY in December 2010 and remains a director. During June 2011, the Company’s CEO contributed 1,790,440 shares of NAEY to the Company which was valued at $125,331 based on the trading price at the time. Mr. Pruitt did not receive additional compensation as a result of the transfer. | |||||||||
Avenel Financial Group, Inc. | |||||||||
Avenel Financial Group, Inc. is a company owned by Mr. Pruitt. Advances previously made to the Company were repaid during 2011. Avenel Financial Group, Inc. invested as a limited partner in the South African Hooters locations. Avenel Financial Group, Inc. invested $14,000, $12,500, and $25,000 in the Durban, Johannesburg, and Cape Town locations, respectively, and is entitled to receive approximately 2.0%, 1.5%, and 2.9%, respectively, of the net profits after taxation of each of the locations until payout. As of December 31, 2012, Avenel Financial Group, Inc. has received an aggregate of $6,441 in net profits after taxation and $49,816 in return of investment under the same terms as the other limited partners. |
Segments_of_Business
Segments of Business | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Segment Reporting [Abstract] | |||||||||
Segments of Business | 16. SEGMENTS OF BUSINESS | ||||||||
As of December 31, 2012, the Company was organized into two business segments: (1) restaurant ownership and management and (2) investment management and consulting services businesses. However, the Company announced its intention to exit investment management and consulting services businesses in the first quarter of fiscal 2013 and effectuated such exit during the second quarter of fiscal 2013. | |||||||||
Accordingly as of December 31, 2014 and 2013, the Company operates and reports its results as a single operating segment. | |||||||||
The following are revenues, operating loss, and long-lived assets by geographic area as of and for the years ended December 31, 2104 and 2013. | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Revenue: | |||||||||
United States | $ | 12,941,648 | $ | 987,285 | |||||
South Africa | 6,632,024 | 5,738,974 | |||||||
Australia | 5,613,381 | - | |||||||
Europe | 4,656,381 | 1,521,228 | |||||||
$ | 29,843,434 | $ | 8,247,487 | ||||||
Operating Loss: | |||||||||
United States | $ | (4,886,279 | ) | $ | (3,931,276 | ) | |||
South Africa | (373,558 | ) | (386,168 | ) | |||||
Australia | (277,557 | ) | - | ||||||
Europe | (6,914 | ) | (288,911 | ) | |||||
$ | (5,544,308 | ) | $ | (4,606,355 | ) | ||||
Long Lived Assets: | |||||||||
United States | $ | 15,299,108 | $ | 13,661,243 | |||||
South Africa | 2,172,528 | 2,191,584 | |||||||
Australia | 13,068,305 | 1,434,128 | |||||||
Europe | 3,648,133 | 941,963 | |||||||
Brazil | 135,000 | 145,555 | |||||||
$ | 34,323,074 | $ | 18,374,473 |
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Commitments and Contingencies Disclosure [Abstract] | |||||
Commitments and Contingencies | 17. COMMITMENTS AND CONTINGENCIES | ||||
The Company leases the land and buildings for its six restaurants in South Africa, five restaurants in Australia 15 restaurants in the United States and one restaurant in each of Hungary and the United Kingdome through its subsidiaries. The South Africa and United Kingdom leases are for five year terms and the Hungary lease is for a 10 year term and include options to extend the terms. The Company through its South Africa subsidiary also purchased land and building in Port Elizabeth, S.A., and also has a mortgage on this property. The 14 restaurants operated in the United States as of December 31, 2014 have lease terms varying from 2 to 10 years and have options to extend. We lease some of our restaurant facilities under “triple net” leases that require us to pay minimum rent, real estate taxes, maintenance costs and insurance premiums and, in some instances, percentage rent based on sales in excess of specified amounts. | |||||
Rent obligations for are presented below: | |||||
Total | |||||
12/31/15 | $ | 2,903,180 | |||
12/31/16 | 2,721,092 | ||||
12/31/17 | 2,203,637 | ||||
12/31/18 | 2,193,450 | ||||
12/31/19 | 2,060,853 | ||||
thereafter | 6,656,486 | ||||
$ | 18,738,698 | ||||
Rent expense for the years ended December 31, 2014 and December 31, 2013 was $2,651,121 and $868,285, respectively. Rent expense for the years ended December 31, 2014 and 2013 for the Company’s restaurants was $2,625,351 and $833,546, respectively, and is included in the “Restaurant operating expenses” of the Consolidated Statement of Operations. Rent expense for the years ended December 31, 2014 and 2013 for the non-restaurants was $25,770 and $34,739, and is included in the “General and administrative expense” of the Consolidated Statement of Operations. | |||||
On October 12, 2012, Francis Howard (“Howard”), individually and on behalf of all others similarly situated, filed a lawsuit against the Company, Michael D. Pruitt, Eric S. Lederer, Michael Carroll, Paul I. Moskowitz, Keith Johnson (the “Individual Defendants”), Merriman Capital, Inc., Dawson James Securities, Inc. (the “Underwriter Defendants”), and Creason & Associates P.L.L.C. (“Creason”), in the U.S. District Court for the Southern District of Florida. The class action lawsuit alleges violations of Section 11 of the Securities Act against all Defendants, violations of Section 12(a)(2) of the Securities Act against only the Underwriter Defendants, and violations of Section 15 against the Individual Defendants. On February 19, 2013, Plaintiff filed an Amended Complaint alleging similar claims to those previously asserted. On March 17, 2014, the parties signed a settlement agreement for a total of $850,000, with $837,500 to be paid on behalf of the Company by its insurance carrier, and $12,500 to be paid by Creason. On August 14, 2014, the Court approved the settlement, which is now final. As a result, all claims against the Company have been dismissed with prejudice. | |||||
On March 26, 2013, our South African operations received Notice of Motion filed in the Kwazulu-Natal High Court, Durban, Republic of South Africa, filed against Rolalor (PTY) LTD (“Rolalor”) and Labyrinth Trading 18 (PTY) LTD (“Labyrinth”) by Jennifer Catherine Mary Shaw (“Shaw”). Rolalor and Labyrinth were the original entities formed to operate the Johannesburg and Durban locations, respectively. On September 9, 2011, the assets and the then-disclosed liabilities of these entities were transferred to Tundraspex (PTY) LTD (“Tundraspex”) and Dimaflo (PTY) LTD (“Dimaflo”), respectively. The current entities, Tundraspex and Dimaflo are not parties in the lawsuit. Shaw is requesting that the Respondents, Rolalor and Labyrinth, be wound up in satisfaction of an alleged debt owed in the total amount of R4,082,636 (approximately $480,000). The two Notices were defended and argued in the High Court of South Africa (Durban) on January 31, 2014. Madam Justice Steryi dismissed the action with costs on May 5, 2014. Ms. Shaw has appealed this decision. | |||||
In connection with our 2011 acquisitions of the South African entities (whereby, on October 1, 2011, Rolalor, Alimenta 177(Pty.) Ltd. and Labyrinth transferred their respective net assets to the newly formed entities controlled by the Company), the Company believes the purchase and sale with the seller was accomplished in accordance with the laws and regulations of the taxing authorities in South Africa. However, there can be no absolute assurance as to whether the business acquired continues to have any outstanding tax and regulatory filing requirements, (i.e. not filed certain corporate tax returns for previous years) as well as whether the local authorities could seek to recover any unpaid taxes, interest, penalties, or other amounts due from the Company, its shareholders or others. The Company is not aware of any existing obligations that remain outstanding for which the Company may be required to settle. In connection with acquiring the net assets of the business, the Company may be entitled to be reimbursed by the seller for any pre-acquisition obligations of the business that may arise post-acquisition. | |||||
In addition to the matters disclosed above, the Company may be involved in legal proceedings and claims which have arisen in the ordinary course of business. These actions, when ultimately concluded and settled, will not, in the opinion of management, have a material adverse effect upon the financial position, results of operations or cash flows of the company. |
Disclosures_about_Fair_Value
Disclosures about Fair Value | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||
Disclosures about Fair Value | 18. DISCLOSURES ABOUT FAIR VALUE | ||||||||||||||||
Assets and liabilities measured at fair value on a recurring basis are summarized in the following tables according to FASB ASC 820 pricing levels. | |||||||||||||||||
Fair Value Measurement Using | |||||||||||||||||
Recorded | Quoted prices | Significant | Significant | ||||||||||||||
value | in active | other | Unobservable | ||||||||||||||
markets of | observable | Inputs | |||||||||||||||
identical | inputs | (Level 3) | |||||||||||||||
assets | (Level 2) | ||||||||||||||||
(Level 1) | |||||||||||||||||
31-Dec-14 | |||||||||||||||||
Assets: | |||||||||||||||||
Available-for-sale securities | $ | 35,362 | $ | 35,362 | $ | - | $ | - | |||||||||
Liabilities: | |||||||||||||||||
Embedded conversion feature | $ | 1,610,900 | $ | - | $ | - | $ | 1,610,900 | |||||||||
31-Dec-13 | |||||||||||||||||
Assets: | |||||||||||||||||
Available-for-sale securities | $ | 55,112 | $ | 55,112 | $ | - | $ | - | |||||||||
Liabilities: | |||||||||||||||||
Embedded conversion feature | $ | 2,146,000 | $ | - | $ | - | $ | 2,146,000 | |||||||||
At December 31, 2014 and 2013, the Company’s available-for-sale equity securities were valued using Level 1 and Level 2 inputs as summarized above. Level 1 inputs are based on unadjusted prices for identical assets in active markets that the Company can access. Level 2 inputs are based on quoted prices for similar assets other than quoted prices in Level 1, quoted prices in markets that are not yet active, or other inputs that are observable or can be derived principally from or corroborated by observable market data for substantially the full term of the assets. | |||||||||||||||||
The derivative liabilities are measured at fair value using quoted market prices and estimated volatility factors based on historical quoted market prices for the Company’s common stock, and are classified within Level 3 of the valuation hierarchy. | |||||||||||||||||
Certain assets are not carried at fair value on a recurring basis, including investments accounted for under the equity and cost methods. Accordingly, such investments are only included in the fair value hierarchy disclosure when the investment is subject to re-measurement at fair value after initial recognition and the resulting re-measurement is reflected in the consolidated financial statements. | |||||||||||||||||
See Note 4 for further details of the Company’s investments. | |||||||||||||||||
The following table provides a summary of the changes in fair value, including net transfers in and/or out, of all financial assets measured at fair value on a recurring basis using significant unobservable inputs during the year ended December 31, 2014 and 2013. | |||||||||||||||||
Warrants | Conversion | Total | |||||||||||||||
Feature | |||||||||||||||||
Balance at January 31, 2013 | $ | - | $ | - | $ | - | |||||||||||
Change in fair value of derivative liability | (119,600 | ) | (119,600 | ) | |||||||||||||
Included in debt discount | 2,115,400 | 2,115,400 | |||||||||||||||
Included in interest | 150,200 | 150,200 | |||||||||||||||
Balance at December 31, 2013 | - | 2,146,000 | 2,146,000 | ||||||||||||||
Change in fair value of derivative liability | (292,600 | ) | (935,000 | ) | (1,227,600 | ) | |||||||||||
Amount included in debt discounts | 626,900 | 399,900 | 1,026,800 | ||||||||||||||
Balance at December 31, 2014 | $ | 334,300 | $ | 1,610,900 | $ | 1,945,200 |
Subsequent_Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2014 | |
Subsequent Events [Abstract] | |
Subsequent Events | 19. SUBSEQUENT EVENTS |
Convertible Debt | |
In January 2015, a convertible debt holder agreed to convert $250,000 principal plus accrued interest into 168,713 shares of the Company’s common stock. | |
In January, 2015, pursuant to a private offering, we sold a total of 20 units, a unit consisting of convertible debt and warrants to accredited investors resulting in net proceeds of $1,000,000 to the Company and the issuance of 250,000 warrants to these investors. Each unit consists of an 8% convertible promissory Note with the principal face value of $50,000 and a warrant to purchase 12,500 shares of the Company’s common stock. The notes have a term of 3 years, pay interest quarterly at 8% per annum and contain an option by the holder to demand full repayment of the outstanding principal amount of the note, plus all accrued and unpaid interest, at any time after the one-year anniversary of the issuance of the note. The note may be voluntarily converted by the holder into shares of common stock during the period commencing 180 days after the issuance of the notes at an exercise price equal to the lesser of $2.00 per share and a 15% discount to the average of the lowest 3 trading prices for the Company’s common stock during the 10 trading day period ending on the last complete trading day prior to the conversion date of the note, provided however that the conversion price shall not be less than $1.00 per share. The Warrants have an exercise price of $2.50 per share and a term of five years. In conjunction with the sale of the units, the Company also entered into a registration rights agreement pursuant to which the Company agreed to register the shares of common stock underlying the notes and warrants. | |
In January 2015, the Company received $150,000 from the issuance of convertible debt to two investors. The Company issued 8% convertible notes and 37,500 warrants to purchase our common stock at a price of $2.50 with a five year term. | |
In February 2015, a convertible debt holder agreed to convert $500,000 principal plus accrued interest into 373,333 shares of the Company’s common stock. | |
In February 2015, a note holder agreed to convert $100,000 principal plus accrued interest into 100,000 shares of the Company’s common stock. | |
On March 13, 2015, the Company issued a convertible note with an aggregate principal amount of $1 million and a warrant with a five year term to purchase 320,000 shares of common stock at an exercise price of $2.50 per share. This note is secured as follows: (i) a first priority security interest in and to the assets located at the Company’s Townsville and Just Fresh #7 restaurant locations (the “Collateral Assets”); (ii) a second priority security interest in the existing assets, operations and locations the four locations owned by the Company in Australia, operating under Hoot Parramatta Pty. Ltd., Hoot Penrith Pty Ltd., Hoot Campbelltown Pty. Ltd. and Hoot Surfers Paradise Pty. Ltd. and the gaming and management contracts relating thereto; and (iii) a third priority security interest in and to all assets of the Company subordinated to the Company’s current senior bank loan and mezzanine debt. | |
Upon the full payment of this note (a) the investor will be paid an amount, in perpetuity equal to fifty (50%) percent of the monthly net income that the Company receives from its sixty (60%) percent ownership interest in Townsville and Just Fresh #7 stores (collectively, the “Collateral Assets”); provided however that such monthly payment shall not be less than the amount of the average of the prior 12 month period of the actual net income of the Collateral Assets. The investor will also receive fifty (50%) percent of the sale proceeds received by the Company in the event that Townsville and/or Just Fresh #7 stores are sold; provided however should the Company close or liquidate the business or affairs of Townsville and/or Just Fresh #7 stores within a five (5) year period commencing on the Subsequent Closing date, the Company shall pay the investor a monthly amount equal to the average net income generated by the Collateral Assets from their opening until their closing or liquidation; and provided further that the Company shall pay the investor such amount in thirty-six (36) equal installments. | |
Rights Offering | |
On March 16, 2015, the Company completed a rights offering, receiving subscriptions (including both basic and oversubscriptions) for 3,899,742 shares of its common stock for gross proceeds of $7,799,484. The rights offering was made pursuant to a Registration Statement on Form S-1 that was filed with the SEC and became effective on February 17, 2015, and by means of the prospectus that was filed with the SEC on February 18, 2015 and supplemented on February 20, 2015 and March 16, 2015. | |
The shares of the Company’s common stock subscribed for in the rights offering will be issued to shareholders as promptly as practicable. Under the terms of the rights offering, the Company had the right to reduce subscriptions in order to preserve certain of the Company’s tax attributes, such as the utilization of net operating loss carry forwards. On the basis of the Company’s analysis of tax attributes, the Company did not reduce the subscriptions of any shareholder in the rights offering. | |
Acquisition of BGR The Burger Joint | |
Effective March 15, 2015, the Company closed the purchase of BGR Holdings, LLC (“BGR”). A wholly-owned subsidiary of the Company acquired substantially all of the assets of BGR, including the ownership interests of a franchising subsidiary, an operating subsidiary and various restaurant locations engaged in the fast casual hamburger restaurant business under the name “BGR The Burger Joint.” | |
In consideration of the purchased assets, the Company paid a purchase price consisting of $4,000,000 in cash and 500,000 shares of the Company’s common stock, subject to a contractual working capital adjustment. Management expects the working capital adjustment to increase cash consideration by approximately $200,000 to $250,000. | |
A final valuation of the assets and liabilities and purchase price allocation has not been completed as of this reporting period. These amounts are subject to the completion of formal studies and valuations which is expected to occur in early 2015. | |
Acquisition of BT’s Burger Joint | |
On March 31, 2015, the Company entered into an Asset Purchase Agreement with BT’s Burgerjoint Management, LLC (“BT’s”), for the purchase of BT’s by a wholly-owned subsidiary of the Company. The closing of the purchase is scheduled to occur on or before June 1, 2015 and is dependent on various closing conditions. | |
Pursuant to the terms of the Asset Purchase Agreement, a subsidiary of the Company acquired substantially all of the assets of BT’s, including the ownership interests of a franchising subsidiary, an operating subsidiary and various restaurant locations engaged in the fast casual hamburger restaurant business under the name “BT’s Burger Joint.” In consideration of the purchased assets, the Company has agreed to pay a purchase price consisting of one million four hundred thousand dollars in cash and shares of the Company’s common stock, $0.0001 par value per share, equal to one million dollars in the aggregate, subject to a contractual working capital adjustment. |
Significant_Accounting_Policie1
Significant Accounting Policies (Policies) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Accounting Policies [Abstract] | |||||||||
Use Of Estimates | Use of Estimates | ||||||||
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Significant estimates include the valuation of the investments in portfolio companies, deferred tax asset valuation allowances, valuing options and warrants using the Binomial Lattice and Black Scholes models, intangible asset valuations and useful lives, depreciation and uncollectible accounts and reserves . Actual results could differ from those estimates. | |||||||||
Revenue Recognition | revenue recognition | ||||||||
Revenue is recognized when all of the following criteria have been satisfied: | |||||||||
● | Persuasive evidence of an arrangement exists; | ||||||||
● | Delivery has occurred or services have been rendered; | ||||||||
● | The seller’s price to the buyer is fixed or determinable; and | ||||||||
● | Collectability is reasonably assured. | ||||||||
Restaurant Net Sales and Food and Beverage Costs | |||||||||
The Company records revenue from restaurant sales at the time of sale, net of discounts, coupons, employee meals, and complimentary meals and gift cards. Sales, value added (“VAT”) and goods and services tax (“GST”) collected from customers and remitted to governmental authorities are presented on a net basis within sales in our consolidated statements of operations. Cost of sales primarily includes the cost of food, beverages, and merchandise and disposable paper and plastic goods used in preparing and selling our menu items, and exclude depreciation and amortization. Vendor allowances received in connection with the purchase of a vendor’s products are recognized as a reduction of the related food and beverage costs as earned | |||||||||
Management Fee Income | |||||||||
The Company receives revenue from management fees from certain non-affiliated companies, including HOA. | |||||||||
Gaming Income | |||||||||
The Company receives revenue from operating a gaming facility adjacent to its Hooters restaurant in Jantzen Beach, Oregon. The Company also receives gaming revenue from gaming machines located in Sydney Australia, which continues until the $5 million of debt assumed connection with the acquisition of the Hooters franchise stores in Australia is repaid. After that debt has been repaid, our participation in the gaming revenue at the Sydney location will decrease from 100% to 60%. Revenue is recognized as earned from gaming activities, net of taxes and other government fees. | |||||||||
Business Combinations | Business combinations | ||||||||
For business combinations, the assets acquired, the liabilities assumed, and any non-controlling interest are recognized at the acquisition date, measured at their fair values as of that date. In a business combination achieved in stages, the identifiable assets and liabilities, as well as the non-controlling interest in the acquiree, are recognized at the full amounts of their fair values. In a bargain purchase in which the total acquisition-date fair value of the identifiable net assets acquired exceeds the fair value of the consideration transferred plus any non-controlling interest in the acquire, that excess in earnings was recognized as a gain attributable to the Company. | |||||||||
Long-lived Assets | IMPAIRMENT OF LONG-LIVED ASSETS | ||||||||
The Company reviews the recoverability of all long-lived assets, including the related useful lives, whenever events or changes in circumstances indicate that the carrying amount of a long-lived asset might not be recoverable. If required, the Company compares the estimated fair value determined by either the undiscounted future net cash flows or appraised value to the related asset’s carrying value to determine whether there has been an impairment. If an asset is considered impaired, the asset is written down to fair value in the period in which the impairment becomes known. The Company recognized no significant impairment charges during the years ended December 31, 2014 and December 31, 2013, with the exception of charges taken to write-off long-live assets of the Company’s Discontinued Operations (See Note 5 “Discontinued Operations”). | |||||||||
Restaurant Pre-Opening Expenses | RESTAURANT PRE-OPENING EXPENSES | ||||||||
Restaurant pre-opening expenses are non-capital expenditures, which are expensed as incurred, consist of the costs of hiring and training the initial hourly work force for each new restaurant, travel, the cost of food and supplies used in training, grand opening promotional costs, the cost of the initial stocking of operating supplies and other direct costs related to the opening of a restaurant, including rent during the construction and in-restaurant training period. Pre-opening expenses are expensed as incurred. | |||||||||
Liquor Licenses | LIQUOR LICENSES | ||||||||
The costs of obtaining non-transferable liquor licenses that are directly issued by local government agencies for nominal fees are expensed as incurred. The costs of purchasing transferable liquor licenses through open markets in jurisdictions with a limited number of authorized liquor licenses are capitalized as indefinite-lived intangible assets and included in other assets. Liquor licenses are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Annual liquor license renewal fees are expensed over the renewal term. | |||||||||
Accounts and Other Receivables | ACCOUNTS AND OTHER RECEIVABLES | ||||||||
The Company monitors its exposure for credit losses on its receivable balances and the credit worthiness of its receivables on an ongoing basis and records related allowances for doubtful accounts. Allowances are estimated based upon specific customer and other balances, where a risk of default has been identified, and also include a provision for non-customer specific defaults based upon historical experience. The majority of the Company’s accounts are from customer credit card transactions with minimal historical credit risk. As of December 31, 2014 and 2013, the Company has not recorded an allowance for doubtful accounts. If circumstances related to specific customers change, estimates of the recoverability of receivables could also change. | |||||||||
Inventories | INVENTORIES | ||||||||
Inventories are recorded at the lower of cost (first-in, first-out method) or market, and consist primarily of restaurant food items, supplies, beverages and merchandise. | |||||||||
Leases | LEASES | ||||||||
The Company leases certain property under operating leases. The Company also finances certain property using capital leases, with the asset and obligation recorded at an amount equal to the present value of the minimum lease payments during the lease term. | |||||||||
Many of these lease agreements contain rent holidays, rent escalation clauses and/or contingent rent provisions. Rent expense is recognized on a straight-line basis over the expected lease term, including cancelable option periods when failure to exercise such options would result in an economic penalty. The Company also may receive tenant improvement allowances in connection with its leases which are capitalized as leasehold improvements with a corresponding liability recorded in the deferred occupancy liability line in the consolidated balance sheet. The tenant improvement allowance liability is amortized on a straight-line basis over the lease term. The rent commencement date of the lease term is the earlier of the date when the Company becomes legally obligated for the rent payments or the date when the Company takes access to the property or the grounds for build out. Certain leases contain percentage rent provisions where additional rent may become due if the location exceeds certain sales thresholds. The Company recognizes expense related to percentage rent obligations at such time as it becomes probable that the percent rent threshold will be met. | |||||||||
Marketable Equity Securities | MARKETABLE EQUITY SECURITIES | ||||||||
Available-for-sale securities | |||||||||
The Company’s investments in marketable equity securities which are classified as available-for-sale are carried at fair value. Investments available for current operations are classified in the consolidated balance sheets as current assets; investments held for long-term purposes are classified as non-current assets. Unrealized gains and losses, net of tax, are reported in other comprehensive income as a separate component of stockholders’ equity. Gains and losses are reported in the consolidated statements of operations when realized, determined based on the disposition of specifically identified investments, using a first-in, first-out method. | |||||||||
Investments identified by the Company as being potentially impaired are subject to further analysis to determine if the impairment is other than temporary. Other than temporary declines in market value from original costs are charged to investment and other income, net, in the period in which the loss occurs. In determining whether investment holdings are other than temporarily impaired, the Company considers the nature, cause, severity and duration of the impairment. | |||||||||
Other Investments | OTHER INVESTMENTS | ||||||||
Investments in which the Company has the ability to exercise significant influence and that, in general, are at least 20 percent owned are stated at cost plus equity in undistributed net earnings (loss), less distributions received. The Company also has equity investments in which it owns less than 20% which are stated at cost. An impairment loss would be recorded whenever a decline in the value of an equity investment or cost investment is below its carrying amount and is determined to be other than temporary. In judging “other than temporary,” the Company considers the length of time and extent to which the fair value of the investment has been less than the carrying amount of the investment, the near-term and long-term operating and financial prospects of the investee, and the Company’s long-term intent of retaining the investment in the investee. | |||||||||
Fair Value Measurments | FAIR VALUE MEASUREMENTS | ||||||||
For financial assets and liabilities measured at fair value on a recurring basis, fair value is the price we would receive to sell an asset or pay to transfer a liability in an orderly transaction with a market participant at the measurement date. In the absence of active markets for the identical assets or liabilities, such measurements involve developing assumptions based on market observable data and, in the absence of such data, internal information that is consistent with what market participants would use in a hypothetical transaction that occurs at the measurement date. | |||||||||
Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect our market assumptions. Preference is given to observable inputs. These two types of inputs create the following fair value hierarchy: | |||||||||
Level 1 | Quoted prices for identical instruments in active markets. | ||||||||
Level 2 | Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable. | ||||||||
Level 3 | Significant inputs to the valuation model are unobservable. | ||||||||
We maintain policies and procedures to value instruments using the best and most relevant data available. Our investment committee reviews and approves all investment valuations. | |||||||||
Our available-for-sale equity securities are all valued using Level 1 inputs or Level 2 inputs. | |||||||||
Fair Value of Financial Instruments | fair value of financial instruments | ||||||||
The Company is required to disclose fair value information about financial instruments when it is practicable to estimate that value. The carrying amounts of the Company’s cash, accounts receivable, other receivables, inventory, accounts payable, accrued expenses, other current liabilities, convertible notes payable and notes payable approximate their estimated fair value due to the short-term maturities of these financial instruments and because related interest rates offered to the Company approximate current rates. | |||||||||
Property and Equipment | Property and Equipment | ||||||||
Property and equipment are stated at cost, less accumulated depreciation. Depreciation and amortization, which includes amortization of assets held under capital leases, are recorded generally using the straight-line method over the estimated useful lives of the respective assets or, if shorter, the term of the lease for certain assets held under a capital lease. Leasehold improvements are amortized over the lesser of the expected lease term, or the estimated useful lives of the related assets using the straight-line method. | |||||||||
The estimated useful lives used to compute depreciation and amortization are as follow: | |||||||||
Leasehold Improvements | 5-10 years | ||||||||
Restaurant furnishings and equipment | 10-Mar | ||||||||
Furniture and fixtures | 10-Mar | ||||||||
Office and computer equipment | 5-Mar | ||||||||
The carrying amount of all long-lived assets is evaluated periodically to determine if adjustment to the depreciation and amortization period or the unamortized balance is warranted. Based upon its most recent analysis, the Company believes that no impairment of property and equipment exists at December 31, 2014 and 2013. | |||||||||
Maintenance and repairs are charged to operations when incurred. Betterments and renewals are capitalized. When property and equipment are sold or otherwise disposed of, the asset account and related accumulated depreciation account are relieved, and any gain or loss is included in operations. | |||||||||
Goodwill | Goodwill | ||||||||
The Company reviews goodwill for impairment annually or more frequently if indicators of impairment exist. Goodwill is not subject to amortization and has been assigned to reporting units for purposes of impairment testing. The reporting units are our restaurant brands and/or geographic area. | |||||||||
A significant amount of judgment is involved in determining if an indicator of impairment has occurred. Such indicators may include, among others: a significant decline in the Company’s expected future cash flows; a sustained, significant decline in our stock price and market capitalization; a significant adverse change in legal factors or in the business climate; unanticipated competition; the testing for recoverability of a significant asset group within a reporting unit; and slower growth rates. Any adverse change in these factors could have a significant impact on the recoverability of these assets and could have a material impact on the Company’s consolidated financial statements. | |||||||||
The goodwill impairment test involves a two-step process. The first step is a comparison of each reporting unit’s fair value to its carrying value. The Company estimates fair value using the best information available, including market information and discounted cash flow projections (also referred to as the income approach). The income approach uses a reporting unit’s projection of estimated operating results and cash flows that is discounted using a weighted-average cost of capital that reflects current market conditions. The projection uses management’s best estimates of economic and market conditions over the projected period including growth rates in sales, costs and number of units, estimates of future expected changes in operating margins and cash expenditures. Other significant estimates and assumptions include terminal value growth rates, future estimates of capital expenditures and changes in future working capital requirements. The Company validates its estimates of fair value under the income approach by comparing the values to fair value estimates using a market approach. A market approach estimates fair value by applying cash flow and sales multiples to the reporting unit’s operating performance. The multiples are derived from comparable publicly traded companies with similar operating and investment characteristics of the reporting units. | |||||||||
If the fair value of the reporting unit is higher than its carrying value, goodwill is deemed not to be impaired, and no further testing is required. If the carrying value of the reporting unit is higher than its fair value, there is an indication that impairment may exist and the second step must be performed to measure the amount of impairment loss. The amount of impairment is determined by comparing the implied fair value of reporting unit goodwill to the carrying value of the goodwill in the same manner as if the reporting unit was being acquired in a business combination. Specifically, fair value is allocated to all of the assets and liabilities of the reporting unit, including any unrecognized intangible assets, in a hypothetical analysis that would calculate the implied fair value of goodwill. If the implied fair value of goodwill is less than the recorded goodwill, the Company would record an impairment loss for the difference. | |||||||||
Intangible Assets | InTANGIBLE ASSETS | ||||||||
Trade Name/Trademark | |||||||||
The fair value of trade name/trademarks are estimated and compared to the carrying value. The Company estimates the fair value of trademarks using the relief-from-royalty method, which requires assumptions related to projected sales from its annual long-range plan; assumed royalty rates that could be payable if the Company did not own the trademarks; and a discount rate. The Company’s trade name/trademarks have been determined to have a definite-lived life and is being amortized on a straight-line basis over estimated useful lives of 10 years. The amortization expense of these definite-lived intangibles is included in depreciation and amortization in the Company’s consolidated statement of operations. | |||||||||
Franchise Cost | |||||||||
Intangible assets are recorded for the initial franchise fees for our Hooter’s restaurants. The Company amortizes these amounts over a 20 year period, which is the life of the franchise agreement. | |||||||||
Impairment of Long-Lived Assets | IMPAIRMENT OF LONG-LIVED ASSETS | ||||||||
The Company reviews the recoverability of all long-lived assets, including the related useful lives, whenever events or changes in circumstances indicate that the carrying amount of a long-lived asset might not be recoverable. If required, the Company compares the estimated fair value determined by either the undiscounted future net cash flows or appraised value to the related asset’s carrying value to determine whether there has been an impairment. If an asset is considered impaired, the asset is written down to fair value in the period in which the impairment becomes known. The Company recognized no significant impairment charges during the years ended December 31, 2014 and December 31, 2013, with the exception of charges taken to write-off long-live assets of the Company’s Discontinued Operations (See Note 5 “Discontinued Operations”). | |||||||||
Derivative Liabilities | DERIVATIVE LIABILITIES | ||||||||
In connection with the issuance of a secured convertible promissory note, the terms of the convertible note included an embedded conversion feature; which provided for the settlement of the convertible promissory note into shares of common stock at a rate which was determined to be variable. The Company determined that the conversion feature was an embedded derivative instrument pursuant to ASC 815 “Derivatives and Hedging”. | |||||||||
The accounting treatment of derivative financial instruments requires that the Company record the conversion option and related warrants at their fair values as of the inception date of the agreements and at fair value as of each subsequent balance sheet date. Any change in fair value was recorded as a change in the fair value of derivative liabilities for each reporting period at each balance sheet date. The Company reassesses the classification at each balance sheet date. If the classification changes as a result of events during the period, the contract is reclassified as of the date of the event that caused the reclassification. | |||||||||
The fair value of an embedded conversion option that is convertible into a variable amount of shares are deemed to be a “down-round protection” and therefore, do not meet the scope exception for treatment as a derivative under ASC 815. Since, “down-round protection” is not an input into the calculation of the fair value of the conversion option and cannot be considered “indexed to the Company’s own stock” which is a requirement for the scope exception as outlined under ASC 815. The Company determined the fair value of the Binomial Lattice Model and the Black-Scholes Model to be materially the same. The Company’s outstanding warrants did not contain any round down protection. | |||||||||
The Black-Scholes option valuation model is used to estimate the fair value of the warrants or options granted. The model includes subjective input assumptions that can materially affect the fair value estimates. The model was developed for use in estimating the fair value of traded options or warrants. The expected volatility is estimated based on the most recent historical period of time equal to the weighted average life of the warrants or options granted. | |||||||||
Acquired Assets and Assumed Liabilities | ACQUIRED ASSETS AND ASSUMED LIABILITIES | ||||||||
Pursuant to ASC No. 805-10-25, if the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination occurs, but during the allowed measurement period not to exceed one year from the acquisition date, the company retrospectively adjusts the provisional amounts recognized at the acquisition date by means of adjusting the amount recognized for goodwill. | |||||||||
Income Taxes | Income Taxes | ||||||||
Deferred income taxes are provided on the liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax basis. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The Company has provided a valuation allowance for the full amount of the deferred tax assets. | |||||||||
As of December 31, 2014 and 2013 the Company had no accrued interest or penalties relating to any tax obligations. The Company currently has no federal or state examinations in progress, nor has it had any federal or state tax examinations since its inception. The last three years of the Company’s tax years are subject to federal and state tax examination. | |||||||||
Stock-Based Compensation | Stock-based Compensation | ||||||||
The compensation cost relating to share-based payment transactions (including the cost of all employee stock options) is required to be recognized in the financial statements. That cost is measured based on the estimated fair value of the equity or liability instruments issued. A wide range of share-based compensation arrangements including share options, restricted share plans, performance-based awards, share appreciation rights and employee share purchase plans are included. The Company’s financial statements would include an expense for all share-based compensation arrangements granted on or after January 1, 2006 and for any such arrangements that are modified, cancelled or repurchased after that date based on the grant-date estimated fair value. | |||||||||
As of December 31, 2014 and 2013, there were no options outstanding. See Note 14 regarding outstanding warrants. | |||||||||
Loss Per Common Share | LOSS PER COMMON SHARE | ||||||||
The Company is required to report both basic earnings per share, which is based on the weighted-average number of shares outstanding and diluted earnings per share, which is based on the weighted-average number of common shares outstanding plus all diluted shares outstanding. | |||||||||
The following table summarizes the number of common shares potentially issuable upon the exercise of certain warrants, convertible notes payable and convertible interest as of December 31, 2014 and 2013, that have been excluded from the calculation of diluted net loss per common share since the effect would be antidilutive. | |||||||||
31-Dec-14 | 31-Dec-13 | ||||||||
Warrants | 8,715,804 | 7,322,125 | |||||||
Convertible notes payable | 2,626,900 | 637,592 | |||||||
Convertible interest | 42,306 | 282,600 | |||||||
Total | 11,385,010 | 8,242,317 | |||||||
Advertising | ADVERTISING | ||||||||
Advertising costs are expensed as incurred. Advertising expenses which are included in restaurant operating expenses in the accompanying consolidated statement of operations, totaled $444,488 and $183,656 for the years ended December 31, 2014 and 2013, respectively. Advertising expense primarily includes local advertising. | |||||||||
Amortization of Debt Discount | AMORTIZATION OF DEBT DISCOUNT | ||||||||
In 2014, the Company issued various debt with warrants for which total proceeds were allocated to individual instruments based on the relative fair value of the each instrument at the time of issuance. The value of the debt was recorded as discount on debt and amortized over the term of the respective debt. For the year ended December 31, 2014, amortization of debt discount was $1,400,392. | |||||||||
Foreign Currency Translation | FOREIGN CURRENCY TRANSLATION | ||||||||
Assets and liabilities denominated in local currency are translated to US dollars using the exchange rates as in effect at the balance sheet date. Results of operations are translated using average exchange rates prevailing throughout the period. Adjustments resulting from the process of translating foreign currency financial statements from functional currency into U.S. dollars are included in accumulated other comprehensive loss within stockholders’ equity. Foreign currency translation adjustments were $(1,345,794) and $95,210 for the years ended December 31, 2014 and 2013, respectively. Aggregate cumulative translation adjustments as of December 31, 2014 and 2013 were $(1,225,944) and $119,849, respectively. Foreign currency transaction gains and losses are included in current earnings. The Company has determined that local currency is the functional currency for each of its foreign operations. | |||||||||
Comprehensive Income (Loss) | Comprehensive Income (LOSS) | ||||||||
Standards for reporting and displaying comprehensive income (loss) and its components (revenues, expenses, gains and losses) in a full set of general-purpose financial statements requires that all items that are required to be recognized under accounting standards as components of comprehensive income (loss) be reported in a financial statement that is displayed with the same prominence as other financial statements. We are required to (a) classify items of other comprehensive income (loss) by their nature in financial statements, and (b) display the accumulated balance of other comprehensive income (loss) separately in the equity section of the balance sheet for all periods presented. Other comprehensive income (loss) items include foreign currency translation adjustments, and the unrealized gains and losses on our marketable securities classified as held for sale. | |||||||||
Concentration of Credit Risk | concentration of credit risk | ||||||||
The Company maintains its cash with major financial institutions. Cash held in U.S. bank institutions is currently insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000 at each institution. No similar insurance or guarantee exists for cash held in Australia, South Africa, Hungary or United Kingdom bank accounts. There was a $122,633 and $211,064 aggregate uninsured cash balances at December 31, 2014 and 2013, respectively. | |||||||||
Subsequent Events | Subsequent Events. | ||||||||
Management has evaluated all events and transactions that occurred from January 1, 2015 through the date these consolidated financial statements were issued for subsequent events requiring recognition or disclosure in the financial statements | |||||||||
Reclassifications | RECLASSIFICATIONS | ||||||||
Certain reclassifications have been made in the financial statements at December 31, 2014 and for the periods then ended to conform to the December 31, 2014 presentation. The reclassifications had no effect on net loss. | |||||||||
Recent Accounting Pronouncements | RECENT ACCOUNTING PRONOUNCEMENTS | ||||||||
In March 2013, the FASB issued ASU 2013-05, “Foreign Currency Matters” (“ASU 2013-05”). The amendments in ASU 2013-05 resolve the diversity in practice about whether current literature applies to the release of the cumulative translation adjustment into net income when a parent either sells a part or all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a nonprofit activity or a business within a foreign entity. In addition, the amendments in ASU 2013-05 resolve the diversity in practice for the treatment of business combinations achieved in stages (sometimes also referred to as step acquisitions) involving a foreign entity. ASU 2013-05 is effective prospectively for fiscal years and interim reporting periods within those years, beginning after December 15, 2013. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial position and results of operations. | |||||||||
The FASB has issued ASU 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity, which includes amendments that change the requirements for reporting discontinued operations and requires additional disclosures about discontinued operations. Under the new guidance, only disposals representing a strategic shift in operations should be presented as discontinued operations. The guidance is effective for annual periods beginning on or after December 15, 2014. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial position and results of operations. | |||||||||
In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements – Going Concern (Subtopic 205-40): Disclosure of Uncertainties About an Entity’s Ability to Continue as a Going Concern. The standard is intended to define management’s responsibility to decide whether there is substantial doubt about an organization’s ability to continue as a going concern and to provide related footnote disclosures. The standard requires management to decide whether there are conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. The standard provides guidance to an organization’s management, with principles and definitions that are intended to reduce diversity in the timing and content of disclosures that are commonly provided by organizations in their footnotes. The standard becomes effective in annual periods ending after December 15, 2016, with early application permitted. The adoption of this pronouncement is not expected to have a material impact on the consolidated financial statements. Management’s evaluations regarding the Company’s ability to continue as a going concern have been disclosed in Note 1 of the accompanying consolidated financial statements. | |||||||||
In November 2014, the FASB issued ASU No. 2014-17, “Business Combinations (Topic 805): Pushdown Accounting” (“ASU 2014-17”). ASU 2014-17 provides with an option to apply pushdown accounting in its separate financial statements upon occurrence of an event in which an acquirer obtains control of the acquired entity. The acquired entity may elect the option to apply pushdown accounting in the reporting period in which the change-in-control event occurs. If pushdown accounting is not applied in the reporting period in which the change-in-control event occurs, an acquired entity will have the option to elect to apply pushdown accounting in a subsequent reporting period as a change in accounting principle in accordance with ASC Topic 250, “Accounting Changes and Error Corrections”. If pushdown accounting is applied to an individual change-in-control event, that election is irrevocable. ASU 2014-17 also requires an acquired entity that elects the option to apply pushdown accounting in its separate financial statements to disclose information in the current reporting period that enables users of financial statements to evaluate the effect of pushdown accounting. The Company has adopted the amendments in ASU 2014-17, effective November 18, 2014, as the amendments in the update are effective upon issuance. The adoption did not have an impact on the Company’s Consolidated Financial Statements. | |||||||||
There are several other new accounting pronouncements issued by FASB which are not yet effective. Each of these pronouncements has been or will be adopted, as applicable, by the Company. At December 31, 2014, none of these pronouncements are expected to have a material effect on the financial position, results of operations or cash flows of the Company. |
Significant_Accounting_Policie2
Significant Accounting Policies (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Accounting Policies [Abstract] | |||||||||
Property and Equipment Useful Lives | The estimated useful lives used to compute depreciation and amortization are as follow: | ||||||||
Leasehold Improvements | 5-10 years | ||||||||
Restaurant furnishings and equipment | 10-Mar | ||||||||
Furniture and fixtures | 10-Mar | ||||||||
Office and computer equipment | 5-Mar | ||||||||
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following table summarizes the number of common shares potentially issuable upon the exercise of certain warrants, convertible notes payable and convertible interest as of December 31, 2014 and 2013, that have been excluded from the calculation of diluted net loss per common share since the effect would be antidilutive. | ||||||||
31-Dec-14 | 31-Dec-13 | ||||||||
Warrants | 8,715,804 | 7,322,125 | |||||||
Convertible notes payable | 2,626,900 | 637,592 | |||||||
Convertible interest | 42,306 | 282,600 | |||||||
Total | 11,385,010 | 8,242,317 |
Acquisitions_Tables
Acquisitions (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Business Combinations [Abstract] | |||||||||||||||||||||||||
Schedule of Acquisitions Valuation Assumptions | The contractual terms of the agreement does not provide for and the Company does not expect to declare dividends in the near future. Key assumptions used to apply this pricing model as of the date of issuance and December 31, 2014 are presented in the table below: | ||||||||||||||||||||||||
2-Aug-13 | 19-Mar-14 | 19-Nov-14 | 16-Dec-14 | ||||||||||||||||||||||
Common stock closing price | $ | 4.15 | $ | 3.87 | $ | 1.7 | $ | 1.53 | |||||||||||||||||
Conversion per share price | $ | 3.73 | $ | 3.29 | $ | 1.45 | $ | 1.3 | |||||||||||||||||
Conversion shares | 804,764 | 151,999 | 172,672 | 77,061 | |||||||||||||||||||||
Expected life (in years) | 3 | 1 | 3 | 3 | |||||||||||||||||||||
Expected volatility | 109.55 | % | 62.03 | % | 74.28 | % | 74.28 | % | |||||||||||||||||
Call option value | $ | 2.82 | $ | 1.19 | $ | 0.9 | $ | 0.81 | |||||||||||||||||
Risk-free interest rate | 0.59 | % | 0.15 | % | 1.1 | % | 1.1 | % | |||||||||||||||||
Dividends | 0 | % | 0 | % | 0 | % | 0 | % | |||||||||||||||||
31-Dec-14 | 31-Dec-14 | 31-Dec-14 | 31-Dec-14 | ||||||||||||||||||||||
Common stock closing price | $ | 1.73 | $ | 1.73 | $ | 1.73 | $ | 1.73 | |||||||||||||||||
Conversion per share price | $ | 1.49 | $ | 1.47 | $ | 1.26 | $ | 1.26 | |||||||||||||||||
Conversion shares | 2,008,032 | 340,020 | 199,177 | 77,061 | |||||||||||||||||||||
Expected life (in years) | 1.6 | 0.2 | 2.9 | 3 | |||||||||||||||||||||
Expected volatility | 63.72 | % | 65.63 | % | 74.28 | % | 74.28 | % | |||||||||||||||||
Call option value | $ | 0.64 | $ | 0.35 | $ | 0.77 | $ | 0.78 | |||||||||||||||||
Risk-free interest rate | 0.67 | % | 0.4 | % | 1.1 | % | 1.1 | % | |||||||||||||||||
Dividends | 0 | % | 0 | % | 0 | % | 0 | % | |||||||||||||||||
Schedule of Assets Acquired and Liabilities Assumed Recorded At Estimated Fair Values | The acquisitions were accounted for using the purchase method of accounting in accordance with ASC 805 “Business Combinations” and, accordingly, the condensed consolidated statements of operations include the results of these operations from the dates of acquisition. The assets acquired and the liabilities assumed were recorded at estimated fair values based on information currently available and based on certain assumptions as to future operations as follows: | ||||||||||||||||||||||||
2013 Acquisitions | |||||||||||||||||||||||||
ARB | WEW | JF | Total | ||||||||||||||||||||||
Consideration paid: | |||||||||||||||||||||||||
Common stock | $ | 3,611,126 | $ | - | $ | - | $ | 3,611,126 | |||||||||||||||||
Warrants | 1,710,077 | - | - | 1,710,077 | |||||||||||||||||||||
Cash | - | 3,150,000 | 590,000 | 3,740,000 | |||||||||||||||||||||
Total consideration paid | 5,321,203 | 3,150,000 | 590,000 | 9,061,203 | |||||||||||||||||||||
Current assets, excluding cash | 281,574 | 151,546 | 42,206 | 475,326 | |||||||||||||||||||||
Property and equipment | 3,000,122 | 20,493 | 242,531 | 3,263,146 | |||||||||||||||||||||
Goodwill | 2,550,611 | 3,159,500 | 425,151 | 6,135,262 | |||||||||||||||||||||
Trademark/trade name/franchise fee | 1,784,443 | - | 1,010,000 | 2,794,443 | |||||||||||||||||||||
Deposits and other assets | 98,035 | - | - | 98,035 | |||||||||||||||||||||
Total assets acquired, less cash | 7,714,785 | 3,331,539 | 1,719,888 | 12,766,212 | |||||||||||||||||||||
Liabilities assumed | (1,490,288 | ) | (372,824 | ) | (282,317 | ) | (2,145,429 | ) | |||||||||||||||||
Deferred tax liabilities | (956,000 | ) | - | (384,000 | ) | (1,340,000 | ) | ||||||||||||||||||
Non-controlling interest | - | - | (463,571 | ) | (463,571 | ) | |||||||||||||||||||
Common stock and warrants issued | (5,321,203 | ) | - | - | (5,321,203 | ) | |||||||||||||||||||
Cash paid | - | (3,150,000 | ) | (590,000 | ) | (3,740,000 | ) | ||||||||||||||||||
Cash received in excess of cash paid | $ | 52,706 | $ | 191,285 | $ | - | $ | 243,991 | |||||||||||||||||
2014 Acquisitions | |||||||||||||||||||||||||
Hooters | Hooters Australia | The | |||||||||||||||||||||||
Pacific NW | Spoon | April 1, 2014 | July 1, 2014 | Burger Co. | Total | ||||||||||||||||||||
Consideration paid: | |||||||||||||||||||||||||
Common stock | $ | 2,891,156 | $ | 828,750 | $ | - | $ | - | $ | 300,000 | $ | 4,019,906 | |||||||||||||
Warrants | 978,000 | 280,400 | - | 123,333 | - | 1,381,733 | |||||||||||||||||||
Assumption of debt | - | - | - | 5,000,000 | - | 5,000,000 | |||||||||||||||||||
Cash | - | - | 100,000 | - | 250,000 | 350,000 | |||||||||||||||||||
Total consideration paid | 3,869,156 | 1,109,150 | 100,000 | 5,123,333 | 550,000 | 10,751,639 | |||||||||||||||||||
Current assets, excluding cash | 112,078 | 89,817 | 377,296 | 47,777 | 9,926 | 636,894 | |||||||||||||||||||
Property and equipment | 2,731,031 | 391,462 | 2,934,307 | 1,603,557 | 284,795 | 7,945,152 | |||||||||||||||||||
Goodwill | 1,951,909 | 698,583 | - | 8,487,138 | 256,379 | 11,394,009 | |||||||||||||||||||
Trademark/trade name/franchise fee | 60,937 | - | 277,867 | 220,500 | - | 559,304 | |||||||||||||||||||
Deposits and other assets | 20,275 | 5,193 | 90,371 | 20,186 | - | 136,025 | |||||||||||||||||||
Total assets acquired, less cash | 4,876,230 | 1,185,055 | 3,679,841 | 10,379,158 | 551,100 | 20,671,384 | |||||||||||||||||||
Liabilities assumed | (1,009,348 | ) | (97,541 | ) | (1,560,710 | ) | (1,496,536 | ) | (1,100 | ) | (4,165,235 | ) | |||||||||||||
Non-controlling interest | - | - | (993,999 | ) | (3,759,289 | ) | - | (4,753,288 | ) | ||||||||||||||||
Chanticleer equity | - | - | (1,028,749 | ) | - | - | (1,028,749 | ) | |||||||||||||||||
Common stock and warrants issued | (3,869,156 | ) | (1,109,150 | ) | - | (123,333 | ) | (300,000 | ) | (5,401,639 | ) | ||||||||||||||
Assumption of debt | - | - | - | (5,000,000 | ) | - | (5,000,000 | ) | |||||||||||||||||
Cash paid | - | - | (100,000 | ) | - | (250,000 | ) | (350,000 | ) | ||||||||||||||||
Cash received in excess of cash paid | $ | 2,274 | $ | 21,636 | $ | 3,617 | $ | - | $ | - | $ | 27,527 | |||||||||||||
Schedule of Business Combination Pro Forma Information | The pro forma results include estimates and assumptions which management believes are reasonable. However, pro forma results are not necessarily indicative of the results that would have occurred if the business combination had been in effect on the dates indicated, or which may result in the future. | ||||||||||||||||||||||||
Years Ended | |||||||||||||||||||||||||
December 31, | |||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
Total revenues | $ | 34,531,238 | $ | 31,949,925 | |||||||||||||||||||||
Loss from continuing operations | (5,845,064 | ) | (6,276,055 | ) | |||||||||||||||||||||
Loss from discontinued operations | (920,960 | ) | (25,215 | ) | |||||||||||||||||||||
Loss attributable to non-controlling interest | (247,705 | ) | (264,022 | ) | |||||||||||||||||||||
Net loss | $ | (6,092,769 | ) | $ | (6,540,077 | ) | |||||||||||||||||||
Net loss per share, basic and diluted | $ | (0.96 | ) | $ | (1.50 | ) | |||||||||||||||||||
Net loss per share, discontinued operations | $ | (0.15 | ) | $ | (0.01 | ) | |||||||||||||||||||
Schedule of Business Combination Operating Income Loss | The following table includes information from the Company’s 2013 acquisitions for the year ended December 31, 2013: | ||||||||||||||||||||||||
2013 Acquistions | |||||||||||||||||||||||||
ARC | Just Fresh | WEW | Total | ||||||||||||||||||||||
Revenues | $ | 701,742 | $ | 182,091 | $ | 560,614 | $ | 1,444,447 | |||||||||||||||||
Cost of sales | 282,454 | 53,964 | 197,169 | 533,587 | |||||||||||||||||||||
Other expenses | 787,757 | 179,109 | 274,021 | 1,240,887 | |||||||||||||||||||||
Operating income (loss) | $ | (368,469 | ) | $ | (50,982 | ) | $ | 89,424 | $ | (330,027 | ) | ||||||||||||||
The following table includes information from the Company’s 2014 acquisitions for the year ended December 31, 2014: | |||||||||||||||||||||||||
2014 Acquistions | |||||||||||||||||||||||||
Hooters Pacific NW | Spoon | Hooters Australia | The Burger Co. | Total | |||||||||||||||||||||
Revenues | $ | 4,382,492 | $ | 1,207,688 | $ | 5,613,381 | $ | 81,539 | $ | 11,285,100 | |||||||||||||||
Cost of sales | 1,239,726 | 529,974 | 1,564,198 | 33,305 | 3,367,203 | ||||||||||||||||||||
Other expenses | 3,340,963 | 915,661 | 4,330,224 | 30,847 | 8,617,695 | ||||||||||||||||||||
Operating income (loss) | $ | (198,197 | ) | $ | (237,947 | ) | $ | (281,041 | ) | $ | 17,387 | $ | (699,798 | ) |
Investments_Tables
Investments (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||
Schedule of Investments at Fair Value | Investments at fair value consist of the following at December 31, 2014 and 2013. | ||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Available-for-sale investments at fair value | $ | 35,362 | $ | 55,112 | |||||||||||||||||
Total | $ | 35,362 | $ | 55,112 | |||||||||||||||||
Schedule of Available for Sale Securities | Available-for-sale securities | ||||||||||||||||||||
Activity in our available-for-sale securities may be summarized as follows: | |||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Cost | $ | 263,331 | $ | 263,331 | |||||||||||||||||
Unrealized loss | (227,969 | ) | (208,219 | ) | |||||||||||||||||
Total | $ | 35,362 | $ | 55,112 | |||||||||||||||||
Summary of Sale Securities Available | Our available-for-sale securities consist of the following: | ||||||||||||||||||||
Unrecognized | Realized | Gain | |||||||||||||||||||
Holding | Fair | Holding | on | ||||||||||||||||||
Cost | Gains (Losses) | Value | Loss | Sale | |||||||||||||||||
31-Dec-14 | |||||||||||||||||||||
Appalachian Mountain Brewery | 1,500 | 23,300 | 24,800 | - | 46,292 | ||||||||||||||||
North American Energy | 126,000 | (123,200 | ) | 2,800 | - | - | |||||||||||||||
North American Energy | 10,500 | (9,900 | ) | 600 | - | - | |||||||||||||||
North American Energy | 125,331 | (118,169 | ) | 7,162 | - | - | |||||||||||||||
$ | 263,331 | $ | (227,969 | ) | $ | 35,362 | $ | - | $ | 46,292 | |||||||||||
31-Dec-13 | |||||||||||||||||||||
Appalachian Mountain Brewery | 1,500 | 43,050 | 44,550 | - | - | ||||||||||||||||
North American Energy | 126,000 | (123,200 | ) | 2,800 | - | - | |||||||||||||||
North American Energy | 10,500 | (9,900 | ) | 600 | - | - | |||||||||||||||
North American Energy | 125,331 | (118,169 | ) | 7,162 | - | - | |||||||||||||||
$ | 263,331 | $ | (208,219 | ) | $ | 55,112 | $ | - | $ | - | |||||||||||
Schedule of Other Investments | Other investments are summarized as follows at December 31, 2014 and 2013: | ||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Investments accounted for under the cost method | $ | 1,550,000 | $ | 1,550,000 | |||||||||||||||||
Investments accounted for under the equity method | - | 941,963 | |||||||||||||||||||
Total | $ | 1,550,000 | $ | 2,491,963 | |||||||||||||||||
Schedule of Investments Accounted for Using Equity Method | Activity in investments accounted for using the equity method is summarized as follows: | ||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Balance, beginning of year | $ | 941,963 | $ | 1,066,915 | |||||||||||||||||
Equity in loss | (40,694 | ) | (125,017 | ) | |||||||||||||||||
New investments | 100,000 | 100,000 | |||||||||||||||||||
Reclassification of investments | (1,001,269 | ) | - | ||||||||||||||||||
Return of capital | - | (99,935 | ) | ||||||||||||||||||
Balance, end of year | $ | - | $ | 941,963 | |||||||||||||||||
Schedule Equity Investments Consist | Equity investments consist of the following at December 31, 2014 and December 31, 2013: | ||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Carrying value: | |||||||||||||||||||||
Hoot Campbelltown Pty. Ltd. (49%) - Australia | $ | - | $ | 483,603 | |||||||||||||||||
Hoot Surfers Paradise Pty. Ltd. (49%) - Australia | - | 384,605 | |||||||||||||||||||
Hoot Townsville Pty. Ltd. (49%) - Australia | - | 73,755 | |||||||||||||||||||
$ | - | $ | 941,963 | ||||||||||||||||||
Schedule of Operations of Equity Investments | The condensed statements of operations of equity investments for the years ended December 31, 2014 and 2013 follows: | ||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Revenue | $ | - | $ | 2,328,015 | |||||||||||||||||
Gross profit | - | 1,643,287 | |||||||||||||||||||
Loss from continuing operations | - | (255,136 | ) | ||||||||||||||||||
Net loss | - | (255,136 | ) | ||||||||||||||||||
Summary of Activity in Investments Accounted for Using Cost Method | A summary of the activity in investments accounted for using the cost method follows. | ||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Investments at cost: | |||||||||||||||||||||
Balance, beginning of year | $ | 1,550,000 | $ | 1,050,000 | |||||||||||||||||
Impairment | - | - | |||||||||||||||||||
New investments | - | 500,000 | |||||||||||||||||||
Total | $ | 1,550,000 | $ | 1,550,000 | |||||||||||||||||
Schedule of Investments at Cost | Investments at cost consist of the following at December 31, 2014 and 2013: | ||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Chanticleer Investors, LLC | $ | 800,000 | $ | 800,000 | |||||||||||||||||
Beacher’s Madhouse | 500,000 | 500,000 | |||||||||||||||||||
Edison Nation LLC (FKA Bouncing Brain Productions) | 250,000 | 250,000 | |||||||||||||||||||
$ | 1,550,000 | $ | 1,550,000 |
Discontinued_Operations_Tables
Discontinued Operations (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Discontinued Operations and Disposal Groups [Abstract] | |||||||||
Schedule of Operating Results From Discontinued Operations | The operating results from the discontinued operations for the years ended December 31, 2014 and 2013 consisted of the following: | ||||||||
2014 | 2013 | ||||||||
Total revenue | $ | 1,207,688 | $ | 53,710 | |||||
Total operating expenses | 1,445,636 | 78,925 | |||||||
Non-cash charge on disposal of Spoon | 683,012 | - | |||||||
Net loss from discontinued operations | $ | (920,960 | ) | $ | (25,215 | ) |
Property_and_Equipment_Tables
Property and Equipment (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Property, Plant and Equipment [Abstract] | |||||||||
Schedule of Property, Plant and Equipment | Property and equipment consists of the following at December 31, 2014 and 2013: | ||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Leasehold improvements | $ | 9,940,517 | $ | 4,303,548 | |||||
Restaurant furniture and equipment | 7,827,925 | 2,413,118 | |||||||
Construction in progress | 727,934 | - | |||||||
Office and computer equipment | 51,746 | 50,780 | |||||||
Land and buildings | 437,223 | - | |||||||
Office furniture and fixtures | 60,302 | 47,686 | |||||||
19,045,647 | 6,815,132 | ||||||||
Accumulated depreciation and amortization | (5,730,238 | ) | (1,194,943 | ) | |||||
$ | 13,315,409 | $ | 5,620,189 |
Intangible_Assets_Net_Tables
Intangible Assets, Net (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||
Schedule of Goodwill | Goodwill is summarized by location as follows: | ||||||||||||
December 31, | |||||||||||||
Goodwill | 2014 | 2013 | |||||||||||
South Africa | $ | 273,737 | $ | 396,487 | |||||||||
ARB | 2,806,990 | 2,550,611 | |||||||||||
WEW | 2,868,192 | 3,124,507 | |||||||||||
Just Fresh | 425,151 | 425,151 | |||||||||||
Australia | 7,291,329 | - | |||||||||||
Hootres Pacific NW | 1,951,909 | - | |||||||||||
Total | $ | 15,617,308 | $ | 6,496,756 | |||||||||
Summary of Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill are summarized as follows: | ||||||||||||
2014 | 2013 | ||||||||||||
Beginning Balance | $ | 6,496,756 | $ | 396,487 | |||||||||
Acquisitions | 11,394,009 | 6,135,262 | |||||||||||
Divestures | (698,583 | ) | - | ||||||||||
Goodwill adjustments | (169,000 | ) | - | ||||||||||
Foreign currency translation | (1,405,874 | ) | (34,993 | ) | |||||||||
Ending Balance | $ | 15,617,308 | $ | 6,496,756 | |||||||||
Schedule of Other Intangible Assets | December 31, | ||||||||||||
Intagible assets | 2014 | 2013 | |||||||||||
Franchise fees: | |||||||||||||
South Africa | $ | 290,986 | $ | 448,888 | |||||||||
Europe | 106,506 | 106,506 | |||||||||||
Australia | 383,529 | - | |||||||||||
Hootres Pacific NW | 59,186 | - | |||||||||||
Brazil * | 135,000 | 135,000 | |||||||||||
975,207 | 690,394 | ||||||||||||
Trademark, Tradenames: | |||||||||||||
Just Fresh | 1,010,000 | 1,010,000 | |||||||||||
American Roadside Burger | 1,783,954 | 1,784,327 | |||||||||||
2,793,954 | 2,794,327 | ||||||||||||
Total Intagnibles at cost | 3,769,161 | 3,484,721 | |||||||||||
Accumulated amortization | (372,658 | ) | (60,089 | ) | |||||||||
Intangible assets, net | $ | 3,396,503 | $ | 3,424,632 | |||||||||
Amortization expense | $ | 308,412 | $ | 21,349 | |||||||||
* Amortization of the Brazil franchise cost will begin with the opening of a restaurant in that market. | |||||||||||||
Future Amortization for Franchise Costs and Trade Name/Trademarks | Amortization for franchise costs and trade name/trademarks are as follows: | ||||||||||||
Franchise fees | Trademark / Tradenames | Total | |||||||||||
December 31, | |||||||||||||
2015 | $ | 61,590 | $ | 279,432 | $ | 341,022 | |||||||
2016 | 61,590 | 279,432 | 341,022 | ||||||||||
2017 | 61,590 | 279,432 | 341,022 | ||||||||||
2018 | 61,590 | 279,432 | 341,022 | ||||||||||
2019 | 61,590 | 279,432 | 341,022 | ||||||||||
Thereafter | 438,462 | 1,117,931 | 1,556,393 | ||||||||||
Total | 746,412 | 2,515,091 | 3,261,503 |
LongTerm_Debt_and_Notes_Payabl1
Long-Term Debt and Notes Payable (Tables) | 12 Months Ended | ||||||
Dec. 31, 2014 | |||||||
Debt Disclosure [Abstract] | |||||||
Summary of Long-Term Debt and Notes Payable | Long-term debt and notes payable are summarized as follows. | ||||||
December 31, | |||||||
2014 | 2013 | ||||||
Note payable to a bank due in monthly installments of $4,406 including interest at Wall Street Journal Prime plus 1% (minimum of 5.5%); remaining balance due October 10, 2018; collateralized by substantially all of the Company’s assets and guaranteed by an officer of the Company | (a) | $ | 176,731 | $ | 218,119 | ||
Line of credit to a bank, expires May 10. 2015, interest rate of Wall Street Journal Prime (3.25% as of December 31, 2014) plus 1%, floor rate of 5% | (b) | 500,000 | 472,000 | ||||
Note payable to a bank due interest only at a 5% rate; balloon principal payment due June 10, 2019; collateralized by substantially all of the Company’s assets and guaranteed by an officer of the Company | (c) | 500,000 | - | ||||
Note payable to a bank, matured and paid in full August 5, 2014, interest rate of Wall St. Journal Prime plus 1% | (d) | - | 38,614 | ||||
Loan agreement with an outside company on December 23, 2013, interest at 1% per month, accrued interest and principal originally due February 23, 2014, unsecured. Loan was repaid in full in early 2015 | (e) | 100,000 | 150,000 | ||||
Loan agreement with an outside company on June 20, 2014, interest at 8% annual rate, accrued interest and principal oriinally due July 11, 2014, unsecured. Loan was repaid in full in ealry 2015 | (f) | 100,000 | - | ||||
Mortage loan dated April, 2014, interest ar South African prime rate + 2.6% (11.85% as of December 31, 2014); due July 31, 2024; secured by a bond on all assets at our Port Elizabeth, South Africa location and partially guaranteed by our CEO and South African COO | (g) | 294,362 | - | ||||
Loan agreement with an outside company on July 1, 2014, interest at 12% annual rate, secured by certain secured assets and gaming revenue of the Australian entities, net of discount of $343,733; matures January 31, 2017 | (h) | 4,656,267 | - | ||||
Bank overdraft facilities; unsecured; maximum facilities $260,000; interest rate 11% at December 31, 2014, with annual renewal each December. | (i) | 151,868 | 79,372 | ||||
Term facility with monthly payments of 45,288 Rand, including interest at South African Prime - 1.0% (10.25% as of December 31, 2014); due June 14, 2016 | (j) | 64,309 | 133,448 | ||||
Term facility with monthly payments of 44,727 Rand including interest at South Afican Prime + 3.0% (12.25% as of December 31, 2014); due November 15, 2019. | (k) | 170,053 | - | ||||
Term facility with monthly payments of 33,750 Rand, including interest at South Afican Prime + 3.0% (12.25% as of December 31, 2014); due December 1, 2018. | (l) | 109,340 | 142,807 | ||||
Total | $ | 6.822,930 | $ | 1,234,360 | |||
Current portion of long-term debt | 1,813,647 | 835,454 | |||||
Long-term debt, less current portion | $ | 5,009,283 | $ | 398,906 | |||
(a) and (b) On April 11, 2013, the Company and Paragon Commercial Bank (“Paragon”) entered into a credit agreement (the “Credit Agreement”) which provides for a $500,000 revolving credit facility with a one-year term from the closing date. The Credit Agreement is available to be drawn at the Company’s discretion to finance investments in new business ventures and for the Company’s general corporate working capital requirements in the ordinary course of business. The note payable originally matured on August 10, 2013 and on November 4, 2013 the note was extended to October 10, 2018 with monthly principal and interest payments of $4,406, whereas the new credit facility (b) expires on May 10, 2015. Borrowings under the Credit Agreement bear monthly interest at the greater of: (i) floor rate of 5.00% or (ii) the Wall Street Journal’s prime plus rate (3.25% as of December 31, 2014) plus 1.00%. Any borrowings are secured by a lien on all of the Company’s assets. The obligations under the Credit Agreement are guaranteed by Mike Pruitt, the Company’s Chief Executive Officer. | |||||||
(c) During February 2014, the Company secured a note with Paragon for $500,000 due on June 10, 2019. The note bears interest at a 5% annual rate, interest only monthly payments until the maturity date. | |||||||
(d) ABC entered into a term note with TD Bank in 2008 for $300,000, which has been paid in full as of December 31, 2014. | |||||||
(e) On December 23, 2013, the Company entered into a loan agreement with an outside company for $150,000, originally due on February 23, 2014. Interest is compounded monthly at a rate of 1%. As of February 23, 2014, the Company was not in compliance with the terms of this note due to non-payment of principal and interest. On March 21 and August 20, 2014, the Company paid the note holder $25,000 each of principal and accrued interest. In March 2015, subsequent to the balance sheet date, the Company repaid the loan in full. | |||||||
(f) On June 20, 2014, the Company entered into a loan agreement with an outside company for $100,000, originally due on July 11, 2014. In March 2015, subsequent to the balance sheet date, the Company repaid the loan in full. | |||||||
(g) In April 2014, our South African subsidiary entered into a mortgage note with a South African bank for the purchase of the building in Port Elizabeth for our Hooters location. The 10-year note is for $330,220 with an annual interest rate of 2.6% above the South African prime rate (prime currently 9.25%). Monthly principal and interest payments of approximately $4,600 commenced in August, 2014. The mortgage note is personally guaranteed by our CEO and South African COO and secured by the assets of the Port Elizabeth building. | |||||||
(h) On July 1, 2014, pursuant to Purchase Agreements executed on June 30, 2014, the Company completed the acquisition of a sixty percent (60%) ownership interest in Hoot Parramatta Pty Ltd, Hoot Australia Pty Ltd, Hoot Penrith Pty Ltd, and TMIX Management Australia Pty Ltd (collectively, the “Australian Entities”), which own, operate, and manage Hooters restaurant locations and gaming operations in Australia. The ownership interest in the Australian Entities was purchased from the respective entities in exchange for the Company agreeing to assume a five million dollar ($5,000,000) debt bearing interest at 12% annually and issuing two hundred fifty thousand (250,000) warrants to purchase shares of our common stock. Originally principal repayments were as follows: $2,000,000 on December 31, 2014, $2,000,000 on June 30, 2015, and $1,000,000 on December 31, 2015. On October 15, 2014, principal repayments were restructured whereby $200,000 was due on December 31, 2014, $50,000 is payable each month from January 2015 through December 2015, $2,000,000 is payable January 31, 2016, $1,200,000 is payable on July 31, 2016 and the remaining $1,000,000 is due by January 31, 2017. The Company had not made the December 2014 payment as of the date of this report as the note holder and Company are discussing a potential modification to the loan agreement. Accordingly, the note holder has not issued any notice of default to the Company. | |||||||
(i) The Company’s South African subsidiary has local bank financing in the form of term and overdraft facilities totaling of approximately $151,868 and $79,372 outstanding as of December 31, 2014 and 2013, respectively. | |||||||
(j) The Company’s South African subsidiary has local bank financing in the form of a term loan with monthly payments of 45 thousand Rand, including interest at South African Prime +1.0%. The term loan matures on June 14, 2016. | |||||||
(k) The Company’s South African subsidiary has local bank financing in the form of a term loan with monthly payments of 44 thousand Rand, including interest South African Prime +3.0%. The term loan matures on November 15, 2019. | |||||||
(l) The Company’s South African subsidiary has local bank financing in the form of a term loan with monthly payments of 34 thousand Rand, including interest at South African Prime + 3.0%. The term loan matures on December 1, 2018. |
Convertible_Notes_Payable_Tabl
Convertible Notes Payable (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Convertible Notes Payable [Abstract] | |||||||||||||||||
Schedule of Convertible Notes Payable | December 31, | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
6% Convertible notes payable issued in August 2013 | $ | 3,000,000 | $ | 3,000,000 | |||||||||||||
Discounts on above convertible note | (1,583,333 | ) | (2,583,333 | ) | |||||||||||||
15% Convertible notes payable issued in March 2014 | 500,000 | - | |||||||||||||||
Discounts on above convertible note | (63,730 | ) | - | ||||||||||||||
8% Convertible notes payable issued in Nov/Dec 2014 | 350,000 | - | |||||||||||||||
Discounts on above convertible note | (289,254 | ) | - | ||||||||||||||
1,913,683 | 416,667 | ||||||||||||||||
Current portion of convertible notes payable | (436,270 | ) | - | ||||||||||||||
Convertible notes payable, less current portion | $ | 1,477,413 | $ | 416.667 | |||||||||||||
Fair Value Measurements, Valuation Assumptions of Embedded Conversion Feature and Warrants | The contractual terms of the agreement does not provide for and the Company does not expect to declare dividends in the near future. Key assumptions used to apply this pricing model as of the date of issuance and December 31, 2014 are presented in the table below: | ||||||||||||||||
2-Aug-13 | 19-Mar-14 | 19-Nov-14 | 16-Dec-14 | ||||||||||||||
Common stock closing price | $ | 4.15 | $ | 3.87 | $ | 1.7 | $ | 1.53 | |||||||||
Conversion per share price | $ | 3.73 | $ | 3.29 | $ | 1.45 | $ | 1.3 | |||||||||
Conversion shares | 804,764 | 151,999 | 172,672 | 77,061 | |||||||||||||
Expected life (in years) | 3 | 1 | 3 | 3 | |||||||||||||
Expected volatility | 109.55 | % | 62.03 | % | 74.28 | % | 74.28 | % | |||||||||
Call option value | $ | 2.82 | $ | 1.19 | $ | 0.9 | $ | 0.81 | |||||||||
Risk-free interest rate | 0.59 | % | 0.15 | % | 1.1 | % | 1.1 | % | |||||||||
Dividends | 0 | % | 0 | % | 0 | % | 0 | % | |||||||||
31-Dec-14 | 31-Dec-14 | 31-Dec-14 | 31-Dec-14 | ||||||||||||||
Common stock closing price | $ | 1.73 | $ | 1.73 | $ | 1.73 | $ | 1.73 | |||||||||
Conversion per share price | $ | 1.49 | $ | 1.47 | $ | 1.26 | $ | 1.26 | |||||||||
Conversion shares | 2,008,032 | 340,020 | 199,177 | 77,061 | |||||||||||||
Expected life (in years) | 1.6 | 0.2 | 2.9 | 3 | |||||||||||||
Expected volatility | 63.72 | % | 65.63 | % | 74.28 | % | 74.28 | % | |||||||||
Call option value | $ | 0.64 | $ | 0.35 | $ | 0.77 | $ | 0.78 | |||||||||
Risk-free interest rate | 0.67 | % | 0.4 | % | 1.1 | % | 1.1 | % | |||||||||
Dividends | 0 | % | 0 | % | 0 | % | 0 | % |
Capital_Leases_Payable_Tables
Capital Leases Payable (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Capital Lease Obligations [Abstract] | |||||||||
Schedule of Lease Payments for Capital Leases | Capital leases payable at December 31, 2014 and 2013 is associated with the South African operations and consists of the following: | ||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Capital lease payable, bearing interest at 10%. through August 2017 | $ | 10,502 | $ | 28,589 | |||||
Capital lease payable, bearing interest at 10%. through November 2014 | - | 8,627 | |||||||
Capital lease payable, bearing interest at 11.5%, through July 2016 | 26,489 | 46,721 | |||||||
Capital lease payable, bearing interest at 11.5%, through November 2016 | 40,336 | 66,354 | |||||||
Capital lease payable, bearing interest at 10%, through March 2015 | 1,333 | 14,789 | |||||||
Total capital leases payable | 78,660 | 165,080 | |||||||
Current maturities | 42,032 | 59,162 | |||||||
Capital leases payable, less current maturities | $ | 36,628 | $ | 105,918 | |||||
Schedule of Future Minimum Lease Payments for Capital Leases | The current capital leases cover point of sale and other equipment for five of the South African restaurants. Annual requirements for capital lease obligations are as follows: | ||||||||
December 31, | Amount | ||||||||
2015 | $ | 48,899 | |||||||
2016 | 37,491 | ||||||||
2017 | 3,189 | ||||||||
Total minimum lease payments | 89,579 | ||||||||
Less: amount representing interest | 10,919 | ||||||||
Present Value of Net Minimum Lease Payments | $ | 78,660 |
Accounts_Payable_and_Accrued_E1
Accounts Payable and Accrued Expenses (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Disclosure Text Block [Abstract] | |||||||||
Schedule of Accounts Payable and Accrued Expenses | Accounts payable and accrued expenses are summarized as follows: | ||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Accounts payable | $ | 3,382,818 | $ | 1,673,933 | |||||
Accrued taxes (VAT, GST, Sales Payroll) | 1,604,829 | 636,568 | |||||||
Accrued income taxes | 92,618 | 15,776 | |||||||
Accrued interest | 499,866 | 97,384 | |||||||
$ | 5,580,131 | $ | 2,423,661 |
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||
Schedule of Income before Income Tax, Domestic and Foreign | The breakout of the loss from continuing operations before income taxes between domestic and foreign operations is below: | ||||||||||||
2014 | 2013 | ||||||||||||
Loss from continuing operations before income taxes | |||||||||||||
United States | $ | 5,442,499 | $ | 4,650,443 | |||||||||
Foreign | 759,875 | 636,651 | |||||||||||
$ | 6,202,374 | $ | 5,287,094 | ||||||||||
Schedule of Components of Income Tax Expense (Benefit) | The Income Tax (benefit) provision consists of the following: | ||||||||||||
Foreign | |||||||||||||
Current | $ | 55,486 | $ | 40,935 | |||||||||
Deferred | (267,960 | ) | (167,554 | ) | |||||||||
U.S. Federal | |||||||||||||
Current | 318 | - | |||||||||||
Deferred | (1,266,980 | ) | (652,624 | ) | |||||||||
State & Local | |||||||||||||
Current | - | - | |||||||||||
Deferred | (149,056 | ) | (76,786 | ) | |||||||||
Change in Valuation Allowance | 1,151,691 | 896,964 | |||||||||||
$ | (476,501 | ) | $ | 40,935 | |||||||||
Schedule of Effective Income Tax Rate Reconciliation | The (benefit) provision for income tax using statutory U.S. federal tax rate is reconciled to the company’s effective tax rate as follows: | ||||||||||||
2014 | 2013 | ||||||||||||
Computed “expected” income tax benefit | $ | (2,093,584 | ) | $ | (1,797,612 | ) | |||||||
State income taxes, net of federal benefit | (205,177 | ) | (211,484 | ) | |||||||||
Foreign rate differential | 45,883 | (79,399 | ) | ||||||||||
Prior year deferred tax adjustment | - | 1,083,075 | |||||||||||
Prior year true-ups other deferred tax balances | 106,236 | - | |||||||||||
Travel, entertainment, and other | 91,045 | 537,988 | |||||||||||
Deferred taxes from acquisitions | - | (388,597 | ) | ||||||||||
Fixed asset DTL true-up | 305,796 | - | |||||||||||
Other | 121,609 | - | |||||||||||
Change in valuation allowance | 1,151,691 | 896,964 | |||||||||||
Effective Rate | $ | (476,501 | ) | $ | 40,935 | ||||||||
Schedule of Deferred Tax Assets and Liabilities | Deferred income taxes reflect the net tax effect of temporary differences between the carrying amounts of assets and liabilities for financial reporting and the amounts used for tax purposes. Major components of deferred tax assets at December 31, 2014 and 2013 were: | ||||||||||||
2014 | 2013 | ||||||||||||
Net operating loss carryovers | $ | 6,773,713 | $ | 4,495,059 | |||||||||
Capital loss carryforwards | 488,500 | 488,500 | |||||||||||
Investments | (84,384 | ) | - | ||||||||||
Derivative liability | 372,931 | 645,500 | |||||||||||
Warrants | - | 184,800 | |||||||||||
Australian equity investment | (26,417 | ) | 53,132 | ||||||||||
Deferred occupancy liabilities | 388,114 | 378,521 | |||||||||||
Total deferred Tax Assets | 7,912,457 | 6,245,512 | |||||||||||
Property and equipment | (469,986 | ) | (278,868 | ) | |||||||||
Convertible debt | (372,931 | ) | (645,500 | ) | |||||||||
Intangibles | (957,229 | ) | (1,061,844 | ) | |||||||||
Goodwill | (47,492 | ) | - | ||||||||||
Total deferred tax liabilities | (1,847,638 | ) | (1,986,212 | ) | |||||||||
Net deferred tax assets | 6,064,819 | 4,259,300 | |||||||||||
Valuation Allowance | (6,751,703 | ) | (5,600,012 | ) | |||||||||
$ | (686,884 | ) | $ | (1,340,712 | ) | ||||||||
Schedule of Uncertain Tax Positions | The company’s uncertain tax positions for December 31, 2014 and 2013 are as follows: | ||||||||||||
Unrecognized | Interest and | ||||||||||||
Tax Benefit | Penalties | Total | |||||||||||
Balance at December 31, 2013 | $ | - | $ | - | $ | - | |||||||
Increases related to prior year tax positions | 419,301 | - | 419,301 | ||||||||||
Decreases related to prior year tax positions | - | - | - | ||||||||||
Increases related to current year tax positions | - | - | - | ||||||||||
Settlements during the period | - | - | - | ||||||||||
Lapse of statute of limitations | - | - | - | ||||||||||
Balance at December 31, 2014 | $ | 419,301 | $ | - | $ | 419,301 |
Stockholders_Equity_Tables
Stockholdersb Equity (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Stockholders Equity Tables | |||||||||||||
Schedule of Warrants Activity | A summary of the warrant activity during the years ended December 31, 2014 and 2103 is presented below: | ||||||||||||
Number of | Weighted | Weighted | |||||||||||
Average Exercise | Average | ||||||||||||
Warrants | Price | Remaining Life | |||||||||||
Outstanding January 1, 2013 | - | $ | - | ||||||||||
Granted | 5,501,458 | 5.46 | |||||||||||
Exercised | - | ||||||||||||
Forfeited | - | ||||||||||||
Outstanding December 31, 2013 | 5,501,458 | 5.46 | |||||||||||
Granted | 3,584,118 | 4.97 | |||||||||||
Exercised | (174,772 | ) | 2 | ||||||||||
Forfeited | (195,000 | ) | 6.25 | ||||||||||
Outstanding December 31, 2014 | 8,715,804 | $ | 5.49 | 3 | |||||||||
Exercisable December 31, 2014 | 8,715,804 | $ | 5.49 | 3 | |||||||||
Schedule of Warrants Outstanding | The following table presents information related to stock warrants as of December 31, 2014: | ||||||||||||
Weighted | |||||||||||||
Outstanding | Average | Exercisable | |||||||||||
Number of | Remaining Life | Number of | |||||||||||
Exercise Price | Warrants | in Years | Warrants | ||||||||||
>$5.00 | 3,554,514 | 2.8 | 3,554,514 | ||||||||||
$4.00-$5.00 | 3,935,117 | 3 | 3,935,117 | ||||||||||
$3.00-$4.00 | 963,901 | 4 | 963,901 | ||||||||||
$2.00-$3.00 | 262,272 | 3 | 262,272 | ||||||||||
8,715,804 | 8,715,804 | ||||||||||||
Schedule of Warrant Amortization | Warrant amortization is summarized as follows at December 31, 2014 and 2013 and for the years then ended: | ||||||||||||
2014 | 2013 | ||||||||||||
Additional paid-in capital | $ | 1,107,893 | $ | 657,552 | |||||||||
Interest expense | 336,798 | 22,659 | |||||||||||
Consulting expense | 771,095 | 634,893 | |||||||||||
$ | 1,107,893 | $ | 657,552 |
Related_Party_Transactions_Tab
Related Party Transactions (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Related Party Transactions Tables | |||||||||
Schedule of Non-Interest Bearing Loans and Advances from Related Parties | The Company has received non-interest bearing loans and advances from related parties. The amounts owed by the Company as of December 31, 2014 and 2013 are as follows: | ||||||||
2014 | 2013 | ||||||||
Hoot SA I, LLC | $ | 12,196 | $ | 12,191 | |||||
Hooters Australia Partner | 1,087,451 | - | |||||||
Chanticleer Investors, LLC | 199,436 | - | |||||||
$ | 1,299,083 | $ | 12,191 | ||||||
Scheudle of Earned Income and Made Advance to Related Parties | The Company has earned income from and made advances to related parties. The amounts owed to the Company at December 31, 2014 and 2013 is as follows: | ||||||||
2014 | 2013 | ||||||||
Chanticleer Dividend Fund, Inc. | $ | - | $ | 69,281 | |||||
Chanticleer Investors | - | 1,207 | |||||||
Hoot SA II, III, IV LLC | 46,015 | 45,817 | |||||||
$ | 46,015 | $ | 116,305 |
Segments_of_Business_Tables
Segments of Business (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Segments Of Business Tables | |||||||||
Summary of Revenues, Operating Loss, Long-Lived Assets By Geographic Area | The following are revenues, operating loss, and long-lived assets by geographic area as of and for the years ended December 31, 2104 and 2013. | ||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Revenue: | |||||||||
United States | $ | 12,941,648 | $ | 987,285 | |||||
South Africa | 6,632,024 | 5,738,974 | |||||||
Australia | 5,613,381 | - | |||||||
Europe | 4,656,381 | 1,521,228 | |||||||
$ | 29,843,434 | $ | 8,247,487 | ||||||
Operating Loss: | |||||||||
United States | $ | (4,886,279 | ) | $ | (3,931,276 | ) | |||
South Africa | (373,558 | ) | (386,168 | ) | |||||
Australia | (277,557 | ) | - | ||||||
Europe | (6,914 | ) | (288,911 | ) | |||||
$ | (5,544,308 | ) | $ | (4,606,355 | ) | ||||
Long Lived Assets: | |||||||||
United States | $ | 15,299,108 | $ | 13,661,243 | |||||
South Africa | 2,172,528 | 2,191,584 | |||||||
Australia | 13,068,305 | 1,434,128 | |||||||
Europe | 3,648,133 | 941,963 | |||||||
Brazil | 135,000 | 145,555 | |||||||
$ | 34,323,074 | $ | 18,374,473 |
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Commitments And Contingencies Tables | |||||
Schedule of Rent Obligations | Rent obligations for are presented below: | ||||
Total | |||||
12/31/15 | $ | 2,903,180 | |||
12/31/16 | 2,721,092 | ||||
12/31/17 | 2,203,637 | ||||
12/31/18 | 2,193,450 | ||||
12/31/19 | 2,060,853 | ||||
thereafter | 6,656,486 | ||||
$ | 18,738,698 |
Disclosure_About_Fair_Value_Ta
Disclosure About Fair Value (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||
Schedule of Fair Value of Measured Assets and Liabilities | Assets and liabilities measured at fair value on a recurring basis are summarized in the following tables according to FASB ASC 820 pricing levels. | ||||||||||||||||
Fair Value Measurement Using | |||||||||||||||||
Recorded | Quoted prices | Significant | Significant | ||||||||||||||
value | in active | other | Unobservable | ||||||||||||||
markets of | observable | Inputs | |||||||||||||||
identical | inputs | (Level 3) | |||||||||||||||
assets | (Level 2) | ||||||||||||||||
(Level 1) | |||||||||||||||||
31-Dec-14 | |||||||||||||||||
Assets: | |||||||||||||||||
Available-for-sale securities | $ | 35,362 | $ | 35,362 | $ | - | $ | - | |||||||||
Liabilities: | |||||||||||||||||
Embedded conversion feature | $ | 1,610,900 | $ | - | $ | - | $ | 1,610,900 | |||||||||
31-Dec-13 | |||||||||||||||||
Assets: | |||||||||||||||||
Available-for-sale securities | $ | 55,112 | $ | 55,112 | $ | - | $ | - | |||||||||
Liabilities: | |||||||||||||||||
Embedded conversion feature | $ | 2,146,000 | $ | - | $ | - | $ | 2,146,000 | |||||||||
Summary of Changes in Fair Value | The following table provides a summary of the changes in fair value, including net transfers in and/or out, of all financial assets measured at fair value on a recurring basis using significant unobservable inputs during the year ended December 31, 2014 and 2013. | ||||||||||||||||
Warrants | Conversion | Total | |||||||||||||||
Feature | |||||||||||||||||
Balance at January 31, 2013 | $ | - | $ | - | $ | - | |||||||||||
Change in fair value of derivative liability | (119,600 | ) | (119,600 | ) | |||||||||||||
Included in debt discount | 2,115,400 | 2,115,400 | |||||||||||||||
Included in interest | 150,200 | 150,200 | |||||||||||||||
Balance at December 31, 2013 | - | 2,146,000 | 2,146,000 | ||||||||||||||
Change in fair value of derivative liability | (292,600 | ) | (935,000 | ) | (1,227,600 | ) | |||||||||||
Amount included in debt discounts | 626,900 | 399,900 | 1,026,800 | ||||||||||||||
Balance at December 31, 2014 | $ | 334,300 | $ | 1,610,900 | $ | 1,945,200 |
Nature_of_Business_Details_Nar
Nature of Business (Details Narrative) (USD $) | 0 Months Ended | 12 Months Ended | ||||||
Mar. 19, 2014 | Dec. 31, 2014 | Sep. 09, 2014 | Apr. 02, 2014 | Jul. 02, 2014 | Mar. 24, 2009 | Dec. 31, 2013 | Dec. 10, 2013 | |
Percentage of ownership interest | 49.00% | |||||||
Percentage of business acquisition | 100.00% | |||||||
Cash | $245,828 | |||||||
Cash used for operations | 1,000,000 | |||||||
Proceeds from equity issuance | 7,800,000 | |||||||
Proceeds from convertible debt | 500,000 | 2,200,000 | ||||||
Increase in line of credit | 500,000 | |||||||
Line of credit description | due in May 2015 | |||||||
Line of credit extended payment terms | 5,000,000 | |||||||
Convertible note holder converted amount | 500,000 | |||||||
March 31, 2015 [Member] | ||||||||
Cash | 3,200,000 | |||||||
Hoot Cambelltown Pty [Member] | ||||||||
Controlling interest, ownership percentage | 60.00% | |||||||
Hoot Surfers Paradise Pty. Ltd [Member] | ||||||||
Controlling interest, ownership percentage | 60.00% | |||||||
Hoot Townsville Pty. Ltd [Member] | ||||||||
Controlling interest, ownership percentage | 60.00% | |||||||
BGR Holdings LLC [Member] | ||||||||
Business acquisition, purchase price | 4,000,000 | |||||||
Business acquisition, shares | 500,000 | |||||||
Minimum [Member] | ||||||||
Equity raise | 1,000,000 | |||||||
Maximum [Member] | ||||||||
Equity raise | 3,000,000 | |||||||
Australian Hooters Entities [Member] | ||||||||
Percentage of business acquisition | 60.00% | |||||||
Additional business acquision percentage | 60.00% | |||||||
Australian Hooters Entities [Member] | Minimum [Member] | ||||||||
Percentage of ownership interest | 49.00% | |||||||
Australian Hooters Entities [Member] | Maximum [Member] | ||||||||
Percentage of ownership interest | 60.00% | |||||||
Hoot Campbelltown Pty [Member] | Minimum [Member] | ||||||||
Percentage of ownership interest | 49.00% | |||||||
Hoot Campbelltown Pty [Member] | Maximum [Member] | ||||||||
Percentage of ownership interest | 60.00% | |||||||
Hoot Surfers Paradise Pty. Ltd [Member] | Minimum [Member] | ||||||||
Percentage of ownership interest | 49.00% | |||||||
Hoot Surfers Paradise Pty. Ltd [Member] | Maximum [Member] | ||||||||
Percentage of ownership interest | 60.00% | |||||||
Hoot Townsville Pty. Ltd [Member] | Minimum [Member] | ||||||||
Percentage of ownership interest | 49.00% | |||||||
Hoot Townsville Pty. Ltd [Member] | Maximum [Member] | ||||||||
Percentage of ownership interest | 60.00% | |||||||
Hoot Parramatta Pty Ltd [Member] | ||||||||
Percentage of business acquisition | 60.00% | |||||||
Additional business acquision percentage | 60.00% | |||||||
Hoot Australia Pty Ltd [Member] | ||||||||
Percentage of business acquisition | 60.00% | |||||||
Additional business acquision percentage | 60.00% | |||||||
Hoot Penrith Pty Ltd [Member] | ||||||||
Percentage of business acquisition | 60.00% | |||||||
Additional business acquision percentage | 60.00% | |||||||
Hooters Restaurant Franchises [Member] | ||||||||
Percentage of ownership interest | 50.00% | |||||||
Dine Out [Member] | ||||||||
Percentage of ownership interest | 89.00% | |||||||
Percenatge of company owns | 89.00% | 89.00% | ||||||
Hooters SA Pty Ltd [Member] | ||||||||
Percenatge of company owns | 80.00% | 80.00% | ||||||
Percentage of local management owns | 20.00% | 20.00% | ||||||
Chanticleer South Africa Pty Ltd [Member] | ||||||||
Percenatge of company owns | 100.00% | 100.00% | ||||||
Hooters Umhlanga Pty Ltd [Member] | ||||||||
Percenatge of company owns | 82.00% | 82.00% | ||||||
Percenatge of owns outside investors | 18.00% | 18.00% | ||||||
Tundraspex Pty Ltd [Member] | ||||||||
Percenatge of company owns | 88.00% | 88.00% | ||||||
Percenatge of owns outside investors | 12.00% | 12.00% | ||||||
Pulse Time Trade Pty Ltd [Member] | ||||||||
Percenatge of company owns | 100.00% | 100.00% | ||||||
Hooters Cape Town Pty Ltd [Member] | ||||||||
Percenatge of company owns | 90.00% | 90.00% | ||||||
Percenatge of owns outside investors | 10.00% | 10.00% | ||||||
Hooters Emperors Palace Pty Ltd [Member] | ||||||||
Percenatge of company owns | 88.00% | 88.00% | ||||||
Percenatge of owns outside investors | 12.00% | 12.00% | ||||||
Crown Restaurants Kft [Member] | ||||||||
Percenatge of company owns | 80.00% | 80.00% | ||||||
Percenatge of owns local investors | 20.00% | 20.00% | ||||||
Chanticleer Roadside Burgers International, L.L.C [Member] | ||||||||
Percenatge of company owns | 100.00% | 100.00% | ||||||
West End Wings Ltd [Member] | ||||||||
Percenatge of company owns | 100.00% | 100.00% | ||||||
JFR and JFFS [Member] | ||||||||
Percenatge of company owns | 56.00% | |||||||
Percentage of various investors owns | 44.00% | |||||||
Investors Llc [Member] | ||||||||
Percenatge of company owns | 22.00% | |||||||
Debt instrument, face amount | 50,000,000 | |||||||
HOA Holdings Llc [Member] | ||||||||
Percentage of various investors owns | 3.00% | |||||||
Investment amount | $3,550,000 |
Significant_Accounting_Policie3
Significant Accounting Policies (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Gaming revenue | $5,000,000 | |
Percentage of equity investment owns less stated cost | 20.00% | |
Amortized on a straight-line basis over estimated useful lives | 10 years | |
Impairment charges | ||
Accrued interest or penalties relating to any tax obligations | ||
Options outstanding | ||
Advertising expense | 444,488 | 183,656 |
Amortization of debt discount | 1,400,392 | 566,867 |
Foreign currency translation adjustments | -1,345,794 | 95,210 |
Cumulative translation adjustments | -1,225,944 | 119,849 |
Cash FDIC insured amount | 250,000 | |
Uninsured cash balances | $122,633 | $211,064 |
Franchise Cost [Member] | ||
Amortized on a straight-line basis over estimated useful lives | 20 years | |
Minimum [Member] | ||
Percentage of gaming revenue increase decrease | 100.00% | |
Maximum [Member] | ||
Percentage of gaming revenue increase decrease | 60.00% |
Significant_Accounting_Policie4
Significant Accounting Policies - Property and Equipment Useful Lives (Details) | 12 Months Ended |
Dec. 31, 2014 | |
Leasehold Improvements [Member] | Minimum [Member] | |
Property and equipment estimated useful lives | 5 years |
Leasehold Improvements [Member] | Maximum [Member] | |
Property and equipment estimated useful lives | 10 years |
Restaurant Furnishings and Equipment [Member] | Minimum [Member] | |
Property and equipment estimated useful lives | 3 years |
Restaurant Furnishings and Equipment [Member] | Maximum [Member] | |
Property and equipment estimated useful lives | 10 years |
Office Furniture and Fixtures [Member] | Minimum [Member] | |
Property and equipment estimated useful lives | 3 years |
Office Furniture and Fixtures [Member] | Maximum [Member] | |
Property and equipment estimated useful lives | 10 years |
Office and Computer Equipment [Member] | Minimum [Member] | |
Property and equipment estimated useful lives | 3 years |
Office and Computer Equipment [Member] | Maximum [Member] | |
Property and equipment estimated useful lives | 5 years |
Significant_Accounting_Policie5
Significant Accounting Policies - Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 11,385,010 | 8,242,317 |
Warrant [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 8,715,804 | 7,322,125 |
Convertible Debt Securities [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 2,626,900 | 637,592 |
Convertible Interest [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 42,306 | 282,600 |
Acquisions_Details_Narrative
Acquisions (Details Narrative) (USD $) | 0 Months Ended | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | 1 Months Ended | 9 Months Ended | |||||||||||
Sep. 09, 2014 | Jul. 02, 2014 | Mar. 19, 2014 | Nov. 26, 2013 | Sep. 30, 2014 | Jun. 30, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jan. 31, 2014 | Sep. 09, 2014 | Nov. 30, 2014 | Oct. 31, 2014 | Apr. 02, 2014 | Dec. 11, 2013 | Dec. 10, 2013 | Nov. 05, 2013 | Nov. 07, 2013 | |
Business Acquisition [Line Items] | ||||||||||||||||||
Business acquisition, percentage of voting interests acquired | 100.00% | 100.00% | ||||||||||||||||
Equity method investment, ownership percentage | 49.00% | |||||||||||||||||
Business combination, step acquisition, equity interest in acquiree, percentage | 49.00% | |||||||||||||||||
Common stock, shares, issued | 7,249,442 | 5,387,897 | ||||||||||||||||
Common stock, par value | $0.00 | $0.00 | ||||||||||||||||
Business acquisition, acquired entity costs purchase price | $550,000 | $550,000 | ||||||||||||||||
Class of warrant or right, warrant exercise price | $5.25 | $3.50 | $3.50 | $3.50 | $3.50 | $5.50 | ||||||||||||
Business combination, consideration transferred | 10,751,639 | 9,061,203 | ||||||||||||||||
Business acquisition purchase price assumption | 5,000,000 | |||||||||||||||||
Warrants term | 5 years | 5 years | 5 years | 5 years | ||||||||||||||
Percenatge of revenue | 100.00% | |||||||||||||||||
Percentag eof revenue for use for lifetime of the gaming machines | 60.00% | |||||||||||||||||
Payments to acquire businesses, gross | 300,000 | 350,000 | 3,740,000 | |||||||||||||||
Business combination, consideration transferred, equity interests issued and issuable | 5,401,639 | 5,321,203 | ||||||||||||||||
Hooters Australia [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Fair value assumptions, expected volatility rate | 109.10% | |||||||||||||||||
Fair value assumptions, risk free interest rate | 1.62% | |||||||||||||||||
Issuance of warrants exercise | 250,000 | |||||||||||||||||
Warrants term | 5 years | |||||||||||||||||
Percenatge of revenue | 100.00% | |||||||||||||||||
Percentag eof revenue for use for lifetime of the gaming machines | 60.00% | |||||||||||||||||
Minimum [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Class of warrant or right, warrant exercise price | $2 | |||||||||||||||||
Maximum [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Class of warrant or right, warrant exercise price | $7 | |||||||||||||||||
Just Fresh [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Business acquisition, percentage of voting interests acquired | 56.00% | 56.00% | ||||||||||||||||
Equity method investment, ownership percentage | 5.00% | 51.00% | ||||||||||||||||
Business acquisition, acquired entity costs purchase price | 30,000 | 560,000 | ||||||||||||||||
Business combination, consideration transferred | 590,000 | |||||||||||||||||
Payments to acquire businesses, gross | 590,000 | |||||||||||||||||
Business combination, consideration transferred, equity interests issued and issuable | ||||||||||||||||||
Australian Hooters Entities [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Business acquisition, percentage of voting interests acquired | 60.00% | |||||||||||||||||
Australian Hooters Entities [Member] | Minimum [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Equity method investment, ownership percentage | 49.00% | |||||||||||||||||
Australian Hooters Entities [Member] | Maximum [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Equity method investment, ownership percentage | 60.00% | |||||||||||||||||
Hoot Campbelltown Pty [Member] | Minimum [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Equity method investment, ownership percentage | 49.00% | |||||||||||||||||
Hoot Campbelltown Pty [Member] | Maximum [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Equity method investment, ownership percentage | 60.00% | |||||||||||||||||
Hoot Surfers Paradise Pty. Ltd [Member] | Minimum [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Equity method investment, ownership percentage | 49.00% | |||||||||||||||||
Hoot Surfers Paradise Pty. Ltd [Member] | Maximum [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Equity method investment, ownership percentage | 60.00% | |||||||||||||||||
Hoot Townsville Pty. Ltd [Member] | Minimum [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Equity method investment, ownership percentage | 49.00% | |||||||||||||||||
Hoot Townsville Pty. Ltd [Member] | Maximum [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Equity method investment, ownership percentage | 60.00% | |||||||||||||||||
Hoot Parramatta Pty Ltd [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Business acquisition, percentage of voting interests acquired | 60.00% | |||||||||||||||||
Hoot Australia Pty Ltd [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Business acquisition, percentage of voting interests acquired | 60.00% | |||||||||||||||||
Hoot Penrith Pty Ltd [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Business acquisition, percentage of voting interests acquired | 60.00% | |||||||||||||||||
American Roadside Burgers, Inc [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Equity method investment, ownership percentage | 100.00% | |||||||||||||||||
Noncash or part noncash acquisition, noncash financial or equity instrument consideration, warrants issued | 740,000 | |||||||||||||||||
Common stock, shares, issued | 740,000 | |||||||||||||||||
Common stock, par value | $5 | |||||||||||||||||
Share price | $4.88 | |||||||||||||||||
Fair value assumptions, exercise price | $5 | |||||||||||||||||
Fair value assumptions, expected volatility rate | 55.00% | |||||||||||||||||
Fair value assumptions, risk free interest rate | 1.39% | |||||||||||||||||
West End Wings [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Business acquisition, acquired entity costs purchase price | 3,150,000 | |||||||||||||||||
Business combination, consideration transferred | 3,150,000 | |||||||||||||||||
Payments to acquire businesses, gross | 3,150,000 | |||||||||||||||||
Business combination, consideration transferred, equity interests issued and issuable | ||||||||||||||||||
Hooters Pacific NW [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Noncash or part noncash acquisition, noncash financial or equity instrument consideration, warrants issued | 680,272 | |||||||||||||||||
Class of warrant or right, warrant exercise price | $5.50 | |||||||||||||||||
Business combination, consideration transferred | 3,869,156 | |||||||||||||||||
Warrants term | 5 years | |||||||||||||||||
Payments to acquire businesses, gross | ||||||||||||||||||
Business combination, consideration transferred, equity interests issued and issuable | 3,869,156 | |||||||||||||||||
Hooters Pacific NW [Member] | Minimum [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Class of warrant or right, warrant exercise price | $5.50 | |||||||||||||||||
Hooters Pacific NW [Member] | Maximum [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Class of warrant or right, warrant exercise price | $7 | |||||||||||||||||
Spoon [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Noncash or part noncash acquisition, noncash financial or equity instrument consideration, warrants issued | 195,000 | |||||||||||||||||
Class of warrant or right, warrant exercise price | $5.50 | |||||||||||||||||
Business combination, consideration transferred | 1,109,150 | |||||||||||||||||
Warrants term | 5 years | |||||||||||||||||
Payments to acquire businesses, gross | ||||||||||||||||||
Business combination, consideration transferred, equity interests issued and issuable | 1,109,150 | |||||||||||||||||
Spoon [Member] | Minimum [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Class of warrant or right, warrant exercise price | $5.50 | |||||||||||||||||
Spoon [Member] | Maximum [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Class of warrant or right, warrant exercise price | $7 | |||||||||||||||||
Hooters Australia [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Business acquisition, percentage of voting interests acquired | 60.00% | |||||||||||||||||
Business combination, step acquisition, equity interest in acquiree, percentage | 60.00% | |||||||||||||||||
Burger Company [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Equity method investment, ownership percentage | 100.00% | 100.00% | ||||||||||||||||
Business combination, consideration transferred | 550,000 | 550,000 | ||||||||||||||||
Business acquisition purchase price assumption | 5,000,000 | 5,000,000 | ||||||||||||||||
Payments to acquire businesses, gross | 250,000 | 250,000 | ||||||||||||||||
Business combination, consideration transferred, equity interests issued and issuable | ($300,000) | $300,000 |
Acquisitions_Schedule_of_Acqui
Acquisitions - Schedule of Acquisitions Valuation Assumptions (Details) | 12 Months Ended |
Dec. 31, 2014 | |
Hooters Australia [Member] | |
Business Acquisition [Line Items] | |
Risk-free interest rate | 1.62% |
Expected life | 5 years |
Expected volatility | 109.10% |
Dividends | 0.00% |
Hooters Pacific NW and Spoon [Member] | |
Business Acquisition [Line Items] | |
Risk-free interest rate | 0.79% |
Expected life | 5 years |
Expected volatility | 89.10% |
Dividends | 0.00% |
Acquisitions_Schedule_of_Asset
Acquisitions - Schedule of Assets Acquired and Liabilities Assumed Recorded At Estimated Fair Values (Details) (USD $) | 0 Months Ended | 12 Months Ended | 9 Months Ended | ||
Sep. 09, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Sep. 09, 2014 | Sep. 30, 2014 | |
Business Acquisition [Line Items] | |||||
Common stock | $4,019,906 | $3,611,126 | |||
Warrants | 1,774,000 | 1,710,077 | |||
Assumption of debt | 5,123,333 | ||||
Cash | 300,000 | 350,000 | 3,740,000 | ||
Total Consideration paid | 10,751,639 | 9,061,203 | |||
Current assets, excluding cash | 636,894 | 475,326 | |||
Property and equipment | 7,945,152 | 3,263,146 | |||
Goodwill | 11,394,009 | 6,135,262 | |||
Trademark/trade name/franchise fee | 559,304 | 2,794,443 | |||
Deposits and other assets | 136,025 | 98,035 | |||
Total assets acquired, less cash | 20,671,384 | 12,766,212 | |||
Liabilities assumed | -4,165,235 | -2,145,429 | |||
Non-controlling interest | -4,753,288 | -463,571 | |||
Chanticleer equity | -1,028,749 | 0 | |||
Common stock and warrants issued | -5,401,639 | -5,321,203 | |||
Assumption of debt | -5,000,000 | ||||
Cash paid | -300,000 | -350,000 | -3,740,000 | ||
Cash received in excess of cash paid | 27,527 | 243,991 | |||
American Roadside Burgers [Member] | |||||
Business Acquisition [Line Items] | |||||
Common stock | 3,611,126 | ||||
Warrants | 1,710,077 | ||||
Cash | |||||
Total Consideration paid | 5,321,203 | ||||
Current assets, excluding cash | 281,574 | ||||
Property and equipment | 3,000,122 | ||||
Goodwill | 2,550,611 | ||||
Trademark/trade name/franchise fee | 1,784,443 | ||||
Deposits and other assets | 98,035 | ||||
Total assets acquired, less cash | 7,714,785 | ||||
Liabilities assumed | -1,490,288 | ||||
Non-controlling interest | |||||
Chanticleer equity | |||||
Common stock and warrants issued | -5,321,203 | ||||
Cash paid | |||||
Cash received in excess of cash paid | 52,706 | ||||
West End Wings [Member] | |||||
Business Acquisition [Line Items] | |||||
Common stock | |||||
Warrants | |||||
Cash | 3,150,000 | ||||
Total Consideration paid | 3,150,000 | ||||
Current assets, excluding cash | 151,546 | ||||
Property and equipment | 20,493 | ||||
Goodwill | 3,159,500 | ||||
Trademark/trade name/franchise fee | |||||
Deposits and other assets | |||||
Total assets acquired, less cash | 3,331,539 | ||||
Liabilities assumed | -372,824 | ||||
Non-controlling interest | |||||
Chanticleer equity | |||||
Common stock and warrants issued | |||||
Cash paid | -3,150,000 | ||||
Cash received in excess of cash paid | 191,285 | ||||
Just Fresh [Member] | |||||
Business Acquisition [Line Items] | |||||
Common stock | |||||
Warrants | |||||
Cash | 590,000 | ||||
Total Consideration paid | 590,000 | ||||
Current assets, excluding cash | 42,206 | ||||
Property and equipment | 242,531 | ||||
Goodwill | 425,151 | ||||
Trademark/trade name/franchise fee | 1,010,000 | ||||
Deposits and other assets | |||||
Total assets acquired, less cash | 1,719,888 | ||||
Liabilities assumed | -282,317 | ||||
Non-controlling interest | -463,571 | ||||
Chanticleer equity | |||||
Common stock and warrants issued | |||||
Cash paid | -590,000 | ||||
Cash received in excess of cash paid | |||||
Hooters Pacific NW [Member] | |||||
Business Acquisition [Line Items] | |||||
Common stock | 2,891,156 | ||||
Warrants | 978,000 | ||||
Assumption of debt | |||||
Cash | |||||
Total Consideration paid | 3,869,156 | ||||
Current assets, excluding cash | 112,078 | ||||
Property and equipment | 2,731,031 | ||||
Goodwill | 1,951,909 | ||||
Trademark/trade name/franchise fee | 60,937 | ||||
Deposits and other assets | 20,275 | ||||
Total assets acquired, less cash | 4,876,230 | ||||
Liabilities assumed | -1,009,348 | ||||
Non-controlling interest | |||||
Chanticleer equity | |||||
Common stock and warrants issued | -3,869,156 | ||||
Assumption of debt | |||||
Cash paid | |||||
Cash received in excess of cash paid | 2,274 | ||||
Spoon [Member] | |||||
Business Acquisition [Line Items] | |||||
Common stock | 828,750 | ||||
Warrants | 280,400 | ||||
Assumption of debt | |||||
Cash | |||||
Total Consideration paid | 1,109,150 | ||||
Current assets, excluding cash | 89,817 | ||||
Property and equipment | 391,462 | ||||
Goodwill | 698,583 | ||||
Trademark/trade name/franchise fee | |||||
Deposits and other assets | 5,193 | ||||
Total assets acquired, less cash | 1,185,055 | ||||
Liabilities assumed | -97,541 | ||||
Non-controlling interest | |||||
Chanticleer equity | |||||
Common stock and warrants issued | -1,109,150 | ||||
Assumption of debt | |||||
Cash paid | |||||
Cash received in excess of cash paid | 21,636 | ||||
Hooters Australia April 1, 2014 [Member] | |||||
Business Acquisition [Line Items] | |||||
Common stock | |||||
Warrants | |||||
Assumption of debt | |||||
Cash | 100,000 | ||||
Total Consideration paid | 100,000 | ||||
Current assets, excluding cash | 377,296 | ||||
Property and equipment | 2,934,307 | ||||
Goodwill | |||||
Trademark/trade name/franchise fee | 277,867 | ||||
Deposits and other assets | 90,371 | ||||
Total assets acquired, less cash | 3,679,841 | ||||
Liabilities assumed | -1,560,710 | ||||
Non-controlling interest | -993,999 | ||||
Chanticleer equity | -1,028,749 | ||||
Common stock and warrants issued | |||||
Assumption of debt | |||||
Cash paid | -100,000 | ||||
Cash received in excess of cash paid | 3,617 | ||||
Hooters Australia July 1, 2014 [Member] | |||||
Business Acquisition [Line Items] | |||||
Common stock | |||||
Warrants | 123,333 | ||||
Assumption of debt | 5,000,000 | ||||
Cash | |||||
Total Consideration paid | 5,123,333 | ||||
Current assets, excluding cash | 47,777 | ||||
Property and equipment | 1,603,557 | ||||
Goodwill | 8,487,138 | ||||
Trademark/trade name/franchise fee | 220,500 | ||||
Deposits and other assets | 20,186 | ||||
Total assets acquired, less cash | 10,379,158 | ||||
Liabilities assumed | -1,496,536 | ||||
Non-controlling interest | -3,759,289 | ||||
Chanticleer equity | |||||
Common stock and warrants issued | 123,333 | ||||
Assumption of debt | -5,000,000 | ||||
Cash paid | |||||
Cash received in excess of cash paid | |||||
Burger Company [Member] | |||||
Business Acquisition [Line Items] | |||||
Common stock | 300,000 | ||||
Warrants | |||||
Cash | 250,000 | 250,000 | |||
Total Consideration paid | 550,000 | 550,000 | |||
Current assets, excluding cash | 9,926 | ||||
Property and equipment | 284,795 | ||||
Goodwill | 256,379 | ||||
Trademark/trade name/franchise fee | |||||
Deposits and other assets | |||||
Total assets acquired, less cash | 551,100 | ||||
Liabilities assumed | -1,100 | ||||
Non-controlling interest | |||||
Chanticleer equity | |||||
Common stock and warrants issued | 300,000 | -300,000 | |||
Assumption of debt | |||||
Cash paid | -250,000 | -250,000 | |||
Cash received in excess of cash paid |
Acquisitions_Schedule_of_Busin
Acquisitions - Schedule of Business Combination Pro Forma Information (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Business Combinations [Abstract] | ||
Net revenues | $34,531,238 | $31,949,925 |
Loss from continuing operations | -5,845,064 | -6,276,055 |
Loss from discontinued operations | -920,960 | -25,215 |
Loss attributable to non-controlling interest | -247,705 | -264,022 |
Net loss | ($6,092,769) | ($6,540,077) |
Net loss per share, basic and diluted | ($0.96) | ($1.50) |
Net loss per share, discontinued operations | ($0.15) | ($0.01) |
Acquisitions_Schedule_of_Busin1
Acquisitions - Schedule of Business Combination Operating Income Loss (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Business Acquisition [Line Items] | ||
Revenues | $29,843,434 | $8,247,487 |
Operating income (loss) | -5,544,308 | -4,606,355 |
2013 Acquistions [Member] | ||
Business Acquisition [Line Items] | ||
Revenues | 1,444,447 | |
Cost of sales | 533,587 | |
Other expenses | 1,240,887 | |
Operating income (loss) | -330,027 | |
Hooters Australia [Member] | ||
Business Acquisition [Line Items] | ||
Revenues | 5,613,381 | |
Cost of sales | 1,564,198 | |
Other expenses | 4,330,224 | |
Operating income (loss) | -281,041 | |
2014 Acquistions [Member] | ||
Business Acquisition [Line Items] | ||
Revenues | 11,285,100 | |
Cost of sales | 3,367,203 | |
Other expenses | 8,617,695 | |
Operating income (loss) | -699,798 | |
American Roadside Burgers [Member] | ||
Business Acquisition [Line Items] | ||
Revenues | 701,742 | |
Cost of sales | 282,454 | |
Other expenses | 787,757 | |
Operating income (loss) | -368,469 | |
Just Fresh [Member] | ||
Business Acquisition [Line Items] | ||
Revenues | 182,091 | |
Cost of sales | 53,964 | |
Other expenses | 179,109 | |
Operating income (loss) | -50,982 | |
West End Wings [Member] | ||
Business Acquisition [Line Items] | ||
Revenues | 560,614 | |
Cost of sales | 197,169 | |
Other expenses | 274,021 | |
Operating income (loss) | 89,424 | |
Hooters Pacific NW [Member] | ||
Business Acquisition [Line Items] | ||
Revenues | 4,382,492 | |
Cost of sales | 1,239,726 | |
Other expenses | 3,340,963 | |
Operating income (loss) | -198,197 | |
Spoon [Member] | ||
Business Acquisition [Line Items] | ||
Revenues | 1,207,688 | |
Cost of sales | 529,974 | |
Other expenses | 915,661 | |
Operating income (loss) | -237,947 | |
Burger Company [Member] | ||
Business Acquisition [Line Items] | ||
Revenues | 81,539 | |
Cost of sales | 33,305 | |
Other expenses | 30,847 | |
Operating income (loss) | $17,387 |
Investments_Details_Narrative
Investments (Details Narrative) (USD $) | 0 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 3 Months Ended | 1 Months Ended | |||||
Jul. 02, 2014 | Aug. 31, 2014 | Jan. 26, 2006 | Dec. 31, 2014 | Dec. 31, 2011 | Jun. 30, 2009 | Dec. 31, 2013 | Mar. 31, 2010 | Jun. 30, 2011 | Jul. 31, 2012 | Jan. 24, 2011 | Apr. 02, 2014 | |
Investments Debt And Equity Securities [Line Items] | ||||||||||||
Equity method investment, ownership percentage | 49.00% | |||||||||||
Business acquisition purchase price assumption | $5,000,000 | |||||||||||
Percenatge of revenue | 100.00% | |||||||||||
Percentag eof revenue for use for lifetime of the gaming machines | 60.00% | |||||||||||
Cash distribution | 830,421 | |||||||||||
Management fee income | 392,842 | |||||||||||
Interest and other income | 437,579 | |||||||||||
Business acquisition, description of acquired entity | We acquired 1,205 units (3.378%) in EE Investors, LLC, whose sole asset is 40% of Edison Nation, LLC (formerly Bouncing Brain Productions, LLC). Edison Nation was formed to provide equity capital for new inventions and help bring them to market. | |||||||||||
Ee Investors Llc [Member] | ||||||||||||
Investments Debt And Equity Securities [Line Items] | ||||||||||||
Investments in related party | 250,000 | |||||||||||
Hooters Restaurant [Member] | Minimum [Member] | ||||||||||||
Investments Debt And Equity Securities [Line Items] | ||||||||||||
Equity method investment, ownership percentage | 49.00% | |||||||||||
Hooters Restaurant [Member] | Maximum [Member] | ||||||||||||
Investments Debt And Equity Securities [Line Items] | ||||||||||||
Equity method investment, ownership percentage | 60.00% | |||||||||||
Two Other Hooters Restaurants [Member] | ||||||||||||
Investments Debt And Equity Securities [Line Items] | ||||||||||||
Percentage of business acquisition | 60.00% | |||||||||||
Australian Management [Member] | ||||||||||||
Investments Debt And Equity Securities [Line Items] | ||||||||||||
Percentage of business acquisition | 60.00% | |||||||||||
HOA LLC [Member] | ||||||||||||
Investments Debt And Equity Securities [Line Items] | ||||||||||||
Equity method investment, ownership percentage | 3.00% | |||||||||||
Beachers Madhouse [Member] | ||||||||||||
Investments Debt And Equity Securities [Line Items] | ||||||||||||
Percentage of business acquisition | 25.00% | |||||||||||
Investments in related party | 500,000 | |||||||||||
Controlling interest, ownership percentage | 50.00% | |||||||||||
North Carolina Natural Energy [Member] | ||||||||||||
Investments Debt And Equity Securities [Line Items] | ||||||||||||
Numebr of shares held during period | 6,200 | |||||||||||
Shares acquired for management services | 100,000,000 | |||||||||||
Share acquired for management services, cost | 1,500 | |||||||||||
Acquisition shares closing price | $4.01 | |||||||||||
Maximum percentage of share diluted, description | 1.00% | |||||||||||
Unrealized loss (gain) on securities | 46,492 | |||||||||||
North American Energy Resource [Member] | ||||||||||||
Investments Debt And Equity Securities [Line Items] | ||||||||||||
Unrealized loss (gain) on securities | 123,200 | 123,200 | ||||||||||
Share price | $0.00 | $0.00 | ||||||||||
Shares acquired in exchange of property investments | 700,000 | |||||||||||
Exchange of property investments, value | 126,000 | |||||||||||
North American Energy One [Member] | ||||||||||||
Investments Debt And Equity Securities [Line Items] | ||||||||||||
Shares acquired for management services | 150,000 | |||||||||||
Share acquired for management services, cost | 10,500 | |||||||||||
Unrealized loss (gain) on securities | 9,900 | 9,900 | ||||||||||
North American Energy Two [Member] | ||||||||||||
Investments Debt And Equity Securities [Line Items] | ||||||||||||
Shares acquired for management services | 1,790,440 | |||||||||||
Share acquired for management services, cost | 125,331 | |||||||||||
Unrealized loss (gain) on securities | 118,169 | 118,169 | ||||||||||
Chanticleer Investors Llc [Member] | ||||||||||||
Investments Debt And Equity Securities [Line Items] | ||||||||||||
Equity method investment, ownership percentage | 22.00% | |||||||||||
Note receivable that repaid at closing | 5,000,000 | |||||||||||
Investments in related party | 3,550,000 | |||||||||||
Percentage of investments in related party | 3.10% | |||||||||||
Share investments in related party | 500,000 | |||||||||||
Individual investor ownership amount | 1,750,000 | |||||||||||
Payments to acquire additional interest in subsidiaries | $300,000 |
Investments_Schedule_of_Invest
Investments - Schedule of Investments at Fair Value (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Investments, Debt and Equity Securities [Abstract] | ||
Available-for-sale investments at fair value | $35,362 | $55,112 |
Total | $35,362 | $55,112 |
Investments_Schedule_of_Availa
Investments - Schedule of Available for Sale Securities (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Schedule of Available-for-sale Securities [Line Items] | ||
Cost | $35,362 | $55,112 |
Total | 35,362 | 55,112 |
Available-for-Sale Securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cost | 263,331 | 263,331 |
Unrealized loss | -227,969 | -208,219 |
Total | $35,362 | $55,112 |
Investments_Summary_of_Sale_Se
Investments - Summary of Sale Securities Available (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Schedule of Available-for-sale Securities [Line Items] | ||
Cost | $35,362 | $55,112 |
Unrecongnized Holding Gains (Losses) | -227,969 | -208,219 |
Fair Value | 35,362 | 55,112 |
Realized Holding Loss | 0 | |
Gain on Sale | 46,292 | 0 |
Appalachian Mountain Brewery [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cost | 1,500 | 1,500 |
Unrecongnized Holding Gains (Losses) | 23,300 | -118,169 |
Fair Value | 24,800 | 44,550 |
Realized Holding Loss | 0 | |
Gain on Sale | 46,292 | 0 |
North American Energy One [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cost | 126,000 | 126,000 |
Unrecongnized Holding Gains (Losses) | -123,200 | 43,050 |
Fair Value | 2,800 | 2,800 |
Realized Holding Loss | 0 | |
Gain on Sale | 0 | |
North American Energy Two [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cost | 10,500 | 10,500 |
Unrecongnized Holding Gains (Losses) | -9,900 | -123,200 |
Fair Value | 600 | 600 |
Realized Holding Loss | 0 | |
Gain on Sale | 0 | |
North American Energy Three [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cost | 125,331 | 125,331 |
Unrecongnized Holding Gains (Losses) | -118,169 | -9,900 |
Fair Value | 7,162 | 7,162 |
Realized Holding Loss | 0 | |
Gain on Sale | 0 | |
Available-for-Sale Securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cost | 263,331 | 263,331 |
Fair Value | $35,362 | $55,112 |
Investments_Schedule_of_Other_
Investments - Schedule of Other Investments (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Investments, Debt and Equity Securities [Abstract] | |||
Investments accounted for under the cost method | $1,550,000 | $1,550,000 | $1,050,000 |
Investments accounted for under the equity method | 941,963 | 1,066,915 | |
Total | $1,550,000 | $2,491,963 |
Investments_Schedule_of_Invest1
Investments - Schedule of Investments Accounted For Using Equity Method (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Investments, Debt and Equity Securities [Abstract] | ||
Balance, beginning of year | $941,963 | $1,066,915 |
Equity in loss | -40,694 | -125,017 |
New investments | 100,000 | 100,000 |
Reclassification of investments | -1,001,269 | 0 |
Return of capital | 0 | -99,935 |
Balance, end of year | $941,963 |
Investments_Schedule_Equity_In
Investments - Schedule Equity Investments Consist (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Schedule of Equity Method Investments [Line Items] | ||
Income (Loss) From Equity Method Investments | ($40,694) | ($125,017) |
Equity Method Investments [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Income (Loss) From Equity Method Investments | 941,963 | |
Hoot Campbelltown Pty. Ltd. (49%) - Australia [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Income (Loss) From Equity Method Investments | 483,603 | |
Hoot Surfers Paradise Pty. Ltd. (49%) - Australia [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Income (Loss) From Equity Method Investments | 384,605 | |
Hoot Townsville Pty. Ltd. (49%) - Australia [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Income (Loss) From Equity Method Investments | $73,755 |
Investments_Schedule_Equity_In1
Investments - Schedule Equity Investments Consist (Details) (Parenthetical) | Apr. 02, 2014 | Dec. 31, 2013 |
Equity method investment ownership percentage | 49.00% | |
Hoot Campbelltown Pty. Ltd. (49%) - Australia [Member] | ||
Equity method investment ownership percentage | 49.00% | |
Hoot Surfers Paradise Pty. Ltd. (49%) - Australia [Member] | ||
Equity method investment ownership percentage | 49.00% | |
Hoot Townsville Pty. Ltd. (49%) - Australia [Member] | ||
Equity method investment ownership percentage | 49.00% |
Investments_Schedule_of_Operat
Investments - Schedule of Operations of Equity Investments (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Investments, Debt and Equity Securities [Abstract] | ||
Revenue | $2,328,015 | |
Gross profit | 1,643,287 | |
Loss from continuing operations | -255,136 | |
Net loss | ($255,136) |
Investments_Summary_of_Activit
Investments - Summary of Activity In Investments Accounted for Using Cost Method (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Investments, Debt and Equity Securities [Abstract] | ||
Balance, beginning of year | $1,550,000 | $1,050,000 |
Impairment | 0 | |
New investments | 500,000 | |
Total | $1,550,000 | $1,550,000 |
Investments_Schedule_of_Invest2
Investments - Schedule of Investments At Cost (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Schedule of Available-for-sale Securities [Line Items] | |||
Investments accounted for under the cost method | $1,550,000 | $1,550,000 | $1,050,000 |
Chanticleer Investors Llc [Member] | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investments accounted for under the cost method | 800,000 | 800,000 | |
Beacher Madhouse [Member] | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investments accounted for under the cost method | 500,000 | 500,000 | |
Edison Nation Llc [Member] | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investments accounted for under the cost method | $250,000 | $250,000 |
Discontinued_Operations_Detail
Discontinued Operations (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Discontinued Operations and Disposal Groups [Abstract] | ||
Number of stock units reacquired | 185,000 | |
Number of stock units reacquired during period, value | $446,050 | |
Net assets | 1,109,062 | |
Net loss | 683,012 | |
Liabilities from discontinued | $177,393 | $1,500 |
Discontinued_Operations_Schedu
Discontinued Operations - Schedule of Operating Results From Discontinued Operations (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Discontinued Operations and Disposal Groups [Abstract] | ||
Total revenue | $1,207,688 | $53,710 |
Total operating expenses | 1,445,636 | 78,925 |
Non-cash charge on disposal of Spoon | 683,012 | |
Net loss from discontinued operations | ($920,960) | ($25,215) |
Property_and_Equipment_Details
Property and Equipment (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Property, Plant and Equipment [Line Items] | ||
Depreciation, Depletion and Amortization, Nonproduction | $1,587,858 | $622,274 |
South African Restaurants [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Capital Leased Assets Net | 179,320 | 263,392 |
Net book value of property and equipment | 59,261 | 158,446 |
Depreciation, Depletion and Amortization, Nonproduction | $74,204 | $78,742 |
Property_and_Equipment_Schedul
Property and Equipment - Schedule of Property, Plant and Equipment (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $19,045,647 | $6,815,132 |
Accumulated depreciation and amortization | -5,730,238 | -1,194,943 |
Property and equipment, net | 13,315,409 | 5,620,189 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 9,940,517 | 4,303,548 |
Restaurant Furnishings and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 7,827,925 | 2,413,118 |
Construction In Progress [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 727,934 | |
Office and Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 51,746 | 50,780 |
Land And Buildings [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 437,223 | |
Office Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $60,302 | $47,686 |
Intangible_Assets_Net_Schedule
Intangible Assets, Net - Schedule of Goodwill (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Goodwill [Line Items] | |||
Goodwill | $15,617,308 | $6,496,756 | $396,487 |
South Africa [Member] | |||
Goodwill [Line Items] | |||
Goodwill | 273,737 | 396,487 | |
American Roadside Burgers [Member] | |||
Goodwill [Line Items] | |||
Goodwill | 2,806,990 | 2,550,611 | |
West End Wings [Member] | |||
Goodwill [Line Items] | |||
Goodwill | 2,868,192 | 3,124,507 | |
Just Fresh [Member] | |||
Goodwill [Line Items] | |||
Goodwill | 425,151 | 425,151 | |
Australia [Member] | |||
Goodwill [Line Items] | |||
Goodwill | 7,291,329 | ||
Hooters Pacific NW [Member] | |||
Goodwill [Line Items] | |||
Goodwill | $1,951,909 |
Intangible_Assets_Net_Summary_
Intangible Assets, Net - Summary of Changes in Carrying Amount of Goodwill (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Beginning Balance | $6,496,756 | $396,487 |
Acquisitions | 11,394,009 | 6,135,262 |
Divestures | -698,583 | |
Goodwill adjustments | -169,000 | |
Foreign currency translation | -1,405,874 | -34,993 |
Ending Balance | $15,617,308 | $6,496,756 |
Intangible_Assests_Net_Schedul
Intangible Assests, Net - Schedule of Other Intangible Assets (Details) (USD $) | 12 Months Ended | |||
Dec. 31, 2014 | Dec. 31, 2013 | |||
Finite-Lived Intangible Assets [Line Items] | ||||
Total intangible cost | $3,769,161 | $3,484,721 | ||
Accumulated amortization | -372,658 | -60,089 | ||
Intangible assets, net | 3,396,503 | 3,424,632 | ||
Amortization expense | 308,412 | 21,349 | ||
Franchise Rights [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Total intangible cost | 975,207 | 690,394 | ||
Franchise Rights [Member] | South Africa [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Total intangible cost | 290,986 | 448,888 | ||
Franchise Rights [Member] | Europe [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Total intangible cost | 106,506 | 106,506 | ||
Franchise Rights [Member] | Australia [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Total intangible cost | 383,529 | |||
Franchise Rights [Member] | Hooters Pacific NW and Spoon [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Total intangible cost | 59,186 | |||
Franchise Rights [Member] | Brazil [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Total intangible cost | 135,000 | [1] | 135,000 | [1] |
Trademarks and Trade Names [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Total intangible cost | 2,793,954 | 2,794,327 | ||
Trademarks and Trade Names [Member] | Just Fresh [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Total intangible cost | 1,010,000 | 1,010,000 | ||
Trademarks and Trade Names [Member] | American Roadside Burgers [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Total intangible cost | $1,783,954 | $1,784,327 | ||
[1] | The Brazil franchise cost is not being amortized until we open a restaurant. |
Intangible_Assets_Net_Future_A
Intangible Assets, Net - Future Amortization for Franchise Costs and Trade Name/Trademarks (Details) (USD $) | Dec. 31, 2014 |
Finite-Lived Intangible Assets [Line Items] | |
2015 | $341,022 |
2016 | 341,022 |
2017 | 341,022 |
2018 | 341,022 |
2019 | 341,022 |
Thereafter | 1,556,393 |
Total | 3,261,503 |
Franchise Rights [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
2015 | 61,590 |
2016 | 61,590 |
2017 | 61,590 |
2018 | 61,590 |
2019 | 61,590 |
Thereafter | 438,462 |
Total | 746,412 |
Trademark and Trade Names [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
2015 | 279,432 |
2016 | 279,432 |
2017 | 279,432 |
2018 | 279,432 |
2019 | 279,432 |
Thereafter | 1,117,931 |
Total | $2,515,091 |
LongTerm_Debt_and_Notes_Payabl2
Long-Term Debt and Notes Payable - Summary of Long-Term Debt and Notes Payable (Details) (USD $) | Dec. 31, 2014 | Apr. 30, 2014 | Dec. 31, 2013 | ||
Short-term Debt [Line Items] | |||||
Total Long-term Debt | $6,822,930 | $1,234,360 | |||
Current portion of long-term debt | 1,813,647 | 330,220 | 835,454 | ||
Long-term debt, less current portion | 5,009,283 | 398,906 | |||
Note payable to a bank due in monthly installments of $4,406 including interest at Wall Street Journal Prime plus 1% (minimum of 5.5%); remaining balance due October 10, 2018 [Member] | |||||
Short-term Debt [Line Items] | |||||
Total Long-term Debt | 176,731 | [1] | 218,119 | [1] | |
Line of credit to a bank, expires May 10. 2015, interest rate of Wall Street Journal Prime (3.25% as of December 31, 2014) plus 1%, floor rate of 5% [Member] | |||||
Short-term Debt [Line Items] | |||||
Total Long-term Debt | 500,000 | [1],[2] | 472,000 | [1],[2] | |
Note payable to a bank due interest only at a 5% rate; balloon principal payment due June 10, 2019; collateralized by substantially all of the CompanyBs assets and guaranteed by an officer of the Company [Member] | |||||
Short-term Debt [Line Items] | |||||
Total Long-term Debt | 500,000 | [3] | [3] | ||
Note payable to a bank, matured and paid in full August 5, 2014, interest rate of Wall St. Journal Prime plus 1% [Member] | |||||
Short-term Debt [Line Items] | |||||
Total Long-term Debt | [4] | 38,614 | [4] | ||
Loan agreement with an outside company on December 23, 2013, interest at 1% per month, accrued interest and principal originally due February 23, 2014, unsecured. Loan was repaid in full in early 2015 [Member] | |||||
Short-term Debt [Line Items] | |||||
Total Long-term Debt | 100,000 | [5] | 150,000 | [5] | |
Loan agreement with an outside company on June 20, 2014, interest at 8% annual rate, accrued interest and principal oriinally due July 11, 2014, unsecured. Loan was repaid in full in ealry 2015 [Member] | |||||
Short-term Debt [Line Items] | |||||
Total Long-term Debt | 100,000 | [6] | [6] | ||
Mortage loan dated April, 2014, interest ar South African prime rate + 2.6% (11.85% as of December 31, 2014); due July 31, 2024 [Member] | |||||
Short-term Debt [Line Items] | |||||
Total Long-term Debt | 294,362 | [7] | [7] | ||
Loan agreement with an outside company on July 1, 2014, interest at 12% annual rate, secured by certain secured assets and gaming revenue of the Australian entities, net of discount of $343,733; matures January 31, 2017 [Mem | |||||
Short-term Debt [Line Items] | |||||
Total Long-term Debt | 4,656,267 | [8] | [8] | ||
Bank overdraft facilities; unsecured; maximum facilities $260,000; interest rate 11% at December 31, 2014, with annual renewal each December [Member] | |||||
Short-term Debt [Line Items] | |||||
Total Long-term Debt | 151,868 | [9] | 79,372 | [9] | |
Term facility with monthly payments of 45,288 Rand, including interest at South African Prime - 1.0% (10.25% as of December 31, 2014); due June 14, 2016 [Member] | |||||
Short-term Debt [Line Items] | |||||
Total Long-term Debt | 64,309 | [10] | 133,448 | [10] | |
Term facility with monthly payments of 44,727 Rand including interest at South Afican Prime + 3.0% (12.25% as of December 31, 2014); due November 15, 2019. [Member] | |||||
Short-term Debt [Line Items] | |||||
Total Long-term Debt | 170,053 | [11] | [11] | ||
Term facility with monthly payments of 33,750 Rand, including interest at South Afican Prime + 3.0% (12.25% as of December 31, 2014); due December 1, 2018. [Member] | |||||
Short-term Debt [Line Items] | |||||
Total Long-term Debt | $109,340 | [12] | $142,807 | [12] | |
[1] | (a) and (b) On April 11, 2013, the Company and Paragon Commercial Bank ("Paragon") entered into a credit agreement (the "Credit Agreement") which provides for a $500,000 revolving credit facility with a one-year term from the closing date. The Credit Agreement is available to be drawn at the Company's discretion to finance investments in new business ventures and for the Company's general corporate working capital requirements in the ordinary course of business. The note payable originally matured on August 10, 2013 and on November 4, 2013 the note was extended to October 10, 2018 with monthly principal and interest payments of $4,406, whereas the new credit facility | ||||
[2] | (b) expires on May 10, 2015. Borrowings under the Credit Agreement bear monthly interest at the greater of: (i) floor rate of 5.00% or (ii) the Wall Street Journal's prime plus rate (3.25% as of December 31, 2014) plus 1.00%. Any borrowings are secured by a lien on all of the Company's assets. The obligations under the Credit Agreement are guaranteed by Mike Pruitt, the Company's Chief Executive Officer. | ||||
[3] | (c) During February 2014, the Company secured a note with Paragon for $500,000 due on June 10, 2019. The note bears interest at a 5% annual rate, interest only monthly payments until the maturity date. | ||||
[4] | (d) ABC entered into a term note with TD Bank in 2008 for $300,000, which has been paid in full as of December 31, 2014. | ||||
[5] | (e) On December 23, 2013, the Company entered into a loan agreement with an outside company for $150,000, originally due on February 23, 2014. Interest is compounded monthly at a rate of 1%. As of February 23, 2014, the Company was not in compliance with the terms of this note due to non-payment of principal and interest. On March 21 and August 20, 2014, the Company paid the note holder $25,000 each of principal and accrued interest. In March 2015, subsequent to the balance sheet date, the Company repaid the loan in full. | ||||
[6] | (f) On June 20, 2014, the Company entered into a loan agreement with an outside company for $100,000, originally due on July 11, 2014. In March 2015, subsequent to the balance sheet date, the Company repaid the loan in full. | ||||
[7] | (g) In April 2014, our South African subsidiary entered into a mortgage note with a South African bank for the purchase of the building in Port Elizabeth for our Hooters location. The 10-year note is for $330,220 with an annual interest rate of 2.6% above the South African prime rate (prime currently 9.25%). Monthly principal and interest payments of approximately $4,600 commenced in August, 2014. The mortgage note is personally guaranteed by our CEO and South African COO and secured by the assets of the Port Elizabeth building. | ||||
[8] | (h) On July 1, 2014, pursuant to Purchase Agreements executed on June 30, 2014, the Company completed the acquisition of a sixty percent (60%) ownership interest in Hoot Parramatta Pty Ltd, Hoot Australia Pty Ltd, Hoot Penrith Pty Ltd, and TMIX Management Australia Pty Ltd (collectively, the "Australian Entities"), which own, operate, and manage Hooters restaurant locations and gaming operations in Australia. The ownership interest in the Australian Entities was purchased from the respective entities in exchange for the Company agreeing to assume a five million dollar ($5,000,000) debt bearing interest at 12% annually and issuing two hundred fifty thousand (250,000) warrants to purchase shares of our common stock. Originally principal repayments were as follows: $2,000,000 on December 31, 2014, $2,000,000 on June 30, 2015, and $1,000,000 on December 31, 2015. On October 15, 2014, principal repayments were restructured whereby $200,000 was due on December 31, 2014, $50,000 is payable each month from January 2015 through December 2015, $2,000,000 is payable January 31, 2016, $1,200,000 is payable on July 31, 2016 and the remaining $1,000,000 is due by January 31, 2017. The Company had not made the December 2014 payment as of the date of this report as the note holder and Company are discussing a potential modification to the loan agreement. Accordingly, the note holder has not issued any notice of default to the Company. | ||||
[9] | (i) The Company's South African subsidiary has local bank financing in the form of term and overdraft facilities totaling of approximately $151,868 and $79,372 outstanding as of December 31, 2014 and 2013, respectively. | ||||
[10] | (j) The Company's South African subsidiary has local bank financing in the form of a term loan with monthly payments of 45 thousand Rand, including interest at South African Prime +1.0%. The term loan matures on June 14, 2016. | ||||
[11] | (k) The Company's South African subsidiary has local bank financing in the form of a term loan with monthly payments of 44 thousand Rand, including interest South African Prime +3.0%. The term loan matures on November 15, 2019. | ||||
[12] | (l) The Company's South African subsidiary has local bank financing in the form of a term loan with monthly payments of 34 thousand Rand, including interest at South African Prime + 3.0%. The term loan matures on December 1, 2018. |
LongTerm_Debt_and_Notes_Payabl3
Long-Term Debt and Notes Payable - Summary of Long-Term Debt and Notes Payable (Details) (Parenthetical) (USD $) | 0 Months Ended | 1 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | |||||||||
Nov. 04, 2013 | Apr. 11, 2013 | Apr. 30, 2014 | Mar. 31, 2014 | Feb. 28, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Aug. 20, 2014 | Jun. 20, 2014 | Mar. 21, 2014 | Dec. 23, 2013 | Jul. 02, 2014 | Oct. 15, 2014 | Dec. 31, 2008 | |
Line of credit revolving facility | $500,000 | |||||||||||||
Note payable maturity date | 10-Aug-13 | 31-Jul-24 | 10-Jun-19 | |||||||||||
Noe payable extended date | 10/10/18 | |||||||||||||
Note payable interest rate description | prime plus rate (3.25% as of December 31, 2014) plus 1.00%. | |||||||||||||
Note payable monthly installment amount | 4,406 | 4,600 | ||||||||||||
Line of credit expires date | 10-May-15 | |||||||||||||
Secured note | 500,000 | |||||||||||||
Note interest rate | 5.00% | 11.00% | ||||||||||||
Long term note | 330,220 | 1,813,647 | 835,454 | |||||||||||
Note term | 10 years | 5 years | ||||||||||||
Business acquisition ownership interest percentage | 49.00% | |||||||||||||
Revenue | 29,843,434 | 8,247,487 | ||||||||||||
Bank overdraft facilities | 260,000 | |||||||||||||
Facilities renewal Term description | each December | |||||||||||||
Line of credit monthly payment | 5,000,000 | |||||||||||||
South African Subsidiary [Member] | ||||||||||||||
Bank overdraft facilities | 151,868 | 79,372 | ||||||||||||
South African Subsidiary One [Member] | ||||||||||||||
Line of credit expires date | 14-Jun-16 | |||||||||||||
Line of credit interest rate | 10.25% | |||||||||||||
South African Subsidiary One [Member] | South Africa, Rand [Member] | ||||||||||||||
Line of credit monthly payment | 45,288 | |||||||||||||
South African Subsidiary Two [Member] | ||||||||||||||
Line of credit expires date | 15-Nov-19 | |||||||||||||
Line of credit interest rate | 12.25% | |||||||||||||
South African Subsidiary Two [Member] | South Africa, Rand [Member] | ||||||||||||||
Line of credit monthly payment | 44,727 | |||||||||||||
South African Subsidiary Three [Member] | ||||||||||||||
Line of credit expires date | 1-Dec-18 | |||||||||||||
Line of credit interest rate | 12.25% | |||||||||||||
South African Subsidiary Three [Member] | South Africa, Rand [Member] | ||||||||||||||
Line of credit monthly payment | 33,750 | |||||||||||||
Prime Rate [Member] | South African Subsidiary One [Member] | ||||||||||||||
Line of credit interest rate | 1.00% | |||||||||||||
Prime Rate [Member] | South African Subsidiary Two [Member] | ||||||||||||||
Line of credit interest rate | 3.00% | |||||||||||||
Prime Rate [Member] | South African Subsidiary Three [Member] | ||||||||||||||
Line of credit interest rate | 3.00% | |||||||||||||
Interest Rate Floor [Member] | ||||||||||||||
Note interest rate | 2.60% | 11.85% | ||||||||||||
Interest Rate Floor [Member] | South African [Member] | ||||||||||||||
Note interest rate | 92.50% | |||||||||||||
Credit Agreement [Member] | ||||||||||||||
Line of credit interest rate description | prime plus rate (3.25% as of December 31, 2014) plus 1.00%. | |||||||||||||
Credit Agreement [Member] | Interest Rate Floor [Member] | ||||||||||||||
Line of credit interest rate | 5.00% | |||||||||||||
Loan Agreement [Member] | ||||||||||||||
Note payable maturity date | 11-Jul-14 | 23-Feb-14 | ||||||||||||
Note payable interest rate description | repaid in full in early 2015 | repaid in full in early 2015 | ||||||||||||
Note payable monthly installment amount | 25,000 | 25,000 | ||||||||||||
Note interest rate | 8.00% | 1.00% | ||||||||||||
Short term borrowing | 100,000 | 150,000 | ||||||||||||
Loan Agreement [Member] | Australian Entities [Member] | ||||||||||||||
Note payable maturity date | 31-Jan-17 | |||||||||||||
Revenue | 343,733 | |||||||||||||
Purchase Agreements [Member] | Australian Entities [Member] | ||||||||||||||
Note payable maturity date | 31-Jan-17 | |||||||||||||
Note interest rate | 12.00% | |||||||||||||
Business acquisition ownership interest percentage | 60.00% | |||||||||||||
Debt annual payment amount | 5,000,000 | 200,000 | ||||||||||||
Issuance of warrant to purchase of common stock, shares | 250,000 | |||||||||||||
Purchase Agreements [Member] | Australian Entities [Member] | December 31, 2014 [Member] | ||||||||||||||
Note payable monthly installment amount | 2,000,000 | |||||||||||||
Purchase Agreements [Member] | Australian Entities [Member] | June 30, 2015 [Member] | ||||||||||||||
Note payable monthly installment amount | 2,000,000 | |||||||||||||
Purchase Agreements [Member] | Australian Entities [Member] | December 31, 2015 [Member] | ||||||||||||||
Note payable monthly installment amount | 1,000,000 | |||||||||||||
Purchase Agreements [Member] | Australian Entities [Member] | January 2015 through December 2015 [Member] | ||||||||||||||
Note payable monthly installment amount | 50,000 | |||||||||||||
Purchase Agreements [Member] | Australian Entities [Member] | January 31, 2016 [Member] | ||||||||||||||
Note payable monthly installment amount | 2,000,000 | |||||||||||||
Purchase Agreements [Member] | Australian Entities [Member] | July 31, 2016 [Member] | ||||||||||||||
Note payable monthly installment amount | 1,200,000 | |||||||||||||
Purchase Agreements [Member] | Australian Entities [Member] | January 31, 2017 [Member] | ||||||||||||||
Note payable monthly installment amount | 1,000,000 | |||||||||||||
TD Bank [Member] | ||||||||||||||
Note payable maturity date | 5-Aug-14 | |||||||||||||
Long term note | 300,000 | |||||||||||||
TD Bank [Member] | Prime Rate [Member] | ||||||||||||||
Note interest rate | 1.00% | |||||||||||||
Revolving Credit Facility [Member] | Paragon Commercial Bank [Member] | Credit Agreement [Member] | ||||||||||||||
Line of credit revolving facility | $500,000 | |||||||||||||
Line of credit term | 1 year |
Convertible_Notes_Payable_Deta
Convertible Notes Payable (Details Narrative) (USD $) | 1 Months Ended | 12 Months Ended | 1 Months Ended | 0 Months Ended | 12 Months Ended | |||||||
Apr. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Nov. 30, 2014 | Aug. 02, 2013 | Dec. 31, 2013 | Oct. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 19, 2014 | Feb. 28, 2014 | |
Integer | ||||||||||||
Debt Instrument, Redemption [Line Items] | ||||||||||||
Convertible notes payable, total | $1,913,683 | $1,913,683 | 416,667 | |||||||||
Debt instrument, interest rate, stated percentage | 11.00% | 11.00% | 5.00% | |||||||||
Debt instrument, term | 10 years | 5 years | ||||||||||
Class of warrant or right, warrant exercise price | $3.50 | $3.50 | $3.50 | $5.50 | $3.50 | $3.50 | $5.25 | |||||
percentage of common stock price to coversation price of note | 90.00% | |||||||||||
Debt instrument, convertible, conversion price | $5.25 | $3.73 | $3.73 | |||||||||
Percentage of warrant purchase of number of shares of common stock issued upon conversion of note | 30.00% | |||||||||||
Debt discount net | 292,700 | 292,700 | ||||||||||
Convertible Notes Agreement [Member] | ||||||||||||
Debt Instrument, Redemption [Line Items] | ||||||||||||
Convertible notes payable, total | 100,000 | 100,000 | 250,000 | |||||||||
Debt instrument, interest rate, stated percentage | 8.00% | 8.00% | 8.00% | |||||||||
Debt instrument, term | 3 years | 3 years | ||||||||||
Number of warrants issued | 25,000 | 25,000 | 62,500 | |||||||||
Warrant term | 5 years | 5 years | ||||||||||
Class of warrant or right, warrant exercise price | $2.50 | $2.50 | $2.50 | |||||||||
percentage of common stock price to coversation price of note | 85.00% | 85.00% | ||||||||||
Secured Subordinate Convertible Notes [Member] | ||||||||||||
Debt Instrument, Redemption [Line Items] | ||||||||||||
Convertible notes payable, total | 3,000,000 | |||||||||||
Debt instrument, interest rate, stated percentage | 6.00% | |||||||||||
Debt instrument, term | 36 months | |||||||||||
Note non-compounded interest rate | 6.00% | |||||||||||
Debt instrument, description | the Note holders shall receive 10%, pro rata, of the net profit of the Nottingham, England Hooters restaurant, paid quarterly for the life of the location, and 10% of the net proceeds should the location be sold; | |||||||||||
Number of warrants issued | $300,000 | |||||||||||
Warrant term | 3 years | |||||||||||
Class of warrant or right, warrant exercise price | $3 | |||||||||||
percentage of common stock price to coversation price of note | 90.00% | |||||||||||
Debt instrument, convertible, conversion price | $1 | |||||||||||
Issuance of warrant to purchases of common stock, shares | 300,000 | |||||||||||
Common stock exercise price per share | $3 | |||||||||||
Convertible Notes Payable [Member] | ||||||||||||
Debt Instrument, Redemption [Line Items] | ||||||||||||
percentage of common stock price to coversation price of note | 90.00% | |||||||||||
Debt instrument, convertible, conversion price | $4.71 | $4.71 | ||||||||||
Debt instrument convertible instruments price per shares increased | $5.37 | |||||||||||
Debt instrument convertible number of equity instruments period decrease | 161,172 | 161,172 | ||||||||||
Debt instrument, convertible, number of equity instruments | 637,592 |
Convertible_Notes_Payable_Sche
Convertible Notes Payable - Schedule of Convertible Notes Payable (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Convertible Notes Payable [Line Items] | ||
Convertible Notes Payable, Total | $1,913,683 | $416,667 |
Discounts on above convertible note | -292,700 | |
Current portion of convertible notes payable | -436,270 | |
Convertible notes payable, less current portion | 1,477,413 | 416,667 |
6% Convertible notes payable issued in August 2013 [Member] | ||
Convertible Notes Payable [Line Items] | ||
Convertible Notes Payable, Total | 3,000,000 | 3,000,000 |
Discounts on above convertible note | -1,583,333 | -2,583,333 |
15% Convertible notes payable issued in March 2014 [Member] | ||
Convertible Notes Payable [Line Items] | ||
Convertible Notes Payable, Total | 500,000 | |
Discounts on above convertible note | -63,730 | |
8% Convertible notes payable issued in Nov/Dec 2014 [Member] | ||
Convertible Notes Payable [Line Items] | ||
Convertible Notes Payable, Total | 350,000 | |
Discounts on above convertible note | ($289,254) |
Convertible_Notes_Payable_Sche1
Convertible Notes Payable - Schedule of Convertible Notes Payable (Details) (Parenthetical) | Dec. 31, 2014 | Feb. 28, 2014 | Dec. 31, 2013 |
Convertible notes payable interest rate | 11.00% | 5.00% | |
6% Convertible notes payable issued in August 2013 [Member] | |||
Convertible notes payable interest rate | 6.00% | 6.00% | |
15% Convertible notes payable issued in March 2014 [Member] | |||
Convertible notes payable interest rate | 15.00% | 15.00% | |
8% Convertible notes payable issued in Nov/Dec 2014 [Member] | |||
Convertible notes payable interest rate | 8.00% | 8.00% |
Convertible_Notes_Payable_Fair
Convertible Notes Payable - Fair Value Measurements, Valuation Assumptions of Embedded Conversion Feature and Warrants (Details) (USD $) | 0 Months Ended | 12 Months Ended | ||||
Dec. 16, 2014 | Nov. 19, 2014 | Mar. 19, 2014 | Aug. 02, 2013 | Dec. 31, 2014 | Mar. 31, 2014 | |
Debt Instrument, Redemption [Line Items] | ||||||
Conversion per share price | $3.73 | $5.25 | ||||
Convertible Debt [Member] | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Common stock closing price | $1.53 | $1.70 | $3.87 | $4.15 | ||
Conversion per share price | $1.30 | $1.45 | $3.29 | $3.73 | ||
Conversion shares | 77,061 | 172,672 | 151,999 | 804,764 | ||
Expected life (in years) | 3 years | 3 years | 1 year | 3 years | ||
Expected volatility | 74.28% | 74.28% | 62.03% | 109.55% | ||
Call option value | $0.81 | $0.90 | $1.19 | $2.82 | ||
Risk-free interest rate | 1.10% | 1.10% | 0.15% | 0.59% | ||
Dividends | 0.00% | 0.00% | 0.00% | 0.00% | ||
Convertible Debt One [Member] | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Common stock closing price | $1.73 | |||||
Conversion per share price | $1.49 | |||||
Conversion shares | 2,008,032 | |||||
Expected life (in years) | 1 year 7 months 6 days | |||||
Expected volatility | 63.72% | |||||
Call option value | $0.64 | |||||
Risk-free interest rate | 0.67% | |||||
Dividends | 0.00% | |||||
Convertible Debt Two [Member] | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Common stock closing price | $1.73 | |||||
Conversion per share price | $1.47 | |||||
Conversion shares | 340,020 | |||||
Expected life (in years) | 2 months 12 days | |||||
Expected volatility | 65.63% | |||||
Call option value | $0.35 | |||||
Risk-free interest rate | 0.40% | |||||
Dividends | 0.00% | |||||
Convertible Debt Three [Member] | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Common stock closing price | $1.73 | |||||
Conversion per share price | $1.26 | |||||
Conversion shares | 199,177 | |||||
Expected life (in years) | 2 years 10 months 24 days | |||||
Expected volatility | 74.28% | |||||
Call option value | $0.77 | |||||
Risk-free interest rate | 1.10% | |||||
Dividends | 0.00% | |||||
Convertible Debt Four [Member] | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Common stock closing price | $1.73 | |||||
Conversion per share price | $1.26 | |||||
Conversion shares | 77,061 | |||||
Expected life (in years) | 3 years | |||||
Expected volatility | 74.28% | |||||
Call option value | $0.78 | |||||
Risk-free interest rate | 1.10% | |||||
Dividends | 0.00% |
Capital_Leases_Payable_Schedul
Capital Leases Payable - Schedule of Lease Payments for Capital Leases (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Capital Leases Payable [Line Items] | ||
Total capital leases payable | $78,660 | $165,080 |
Current maturities | 42,032 | 59,162 |
Capital leases payable, less current maturities | 36,628 | 105,918 |
Capital lease payable, bearing interest at 10%. through August 2017 [Member] | ||
Capital Leases Payable [Line Items] | ||
Total capital leases payable | 10,502 | 28,589 |
Capital lease payable, bearing interest at 10%. through November 2014 [Member] | ||
Capital Leases Payable [Line Items] | ||
Total capital leases payable | 8,627 | |
Capital lease payable, bearing interest at 11.5%, through July 2016 [Member] | ||
Capital Leases Payable [Line Items] | ||
Total capital leases payable | 26,489 | 46,721 |
Capital lease payable, bearing interest at 11.5%, through November 2016 [Member] | ||
Capital Leases Payable [Line Items] | ||
Total capital leases payable | 40,336 | 66,354 |
Capital lease payable, bearing interest at 10%, through March 2015 [Member] | ||
Capital Leases Payable [Line Items] | ||
Total capital leases payable | $1,333 | $14,789 |
Capital_Leases_Payable_Schedul1
Capital Leases Payable - Schedule of Lease Payments for Capital Leases (Details) (Parenthetical) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Capital lease payable, bearing interest at 10%. through August 2017 [Member] | ||
Capital lease interest rate | 10.00% | 10.00% |
Capital lease description | through August 2017 | through August 2017 |
Capital lease payable, bearing interest at 10%. through November 2014 [Member] | ||
Capital lease interest rate | 10.00% | 10.00% |
Capital lease description | through November 2014 | through November 2014 |
Capital lease payable, bearing interest at 11.5%, through July 2016 [Member] | ||
Capital lease interest rate | 11.50% | 11.50% |
Capital lease description | through July 2016 | through July 2016 |
Capital lease payable, bearing interest at 11.5%, through November 2016 [Member] | ||
Capital lease interest rate | 11.50% | 11.50% |
Capital lease description | through November 2016 | through November 2016 |
Capital lease payable, bearing interest at 10%, through March 2015 [Member] | ||
Capital lease interest rate | 10.00% | 10.00% |
Capital lease description | through March 2015 | through March 2015 |
Capital_Leases_Payable_Schedul2
Capital Leases Payable - Schedule of Future Minimum Lease Payments for Capital Leases (Details) (USD $) | Dec. 31, 2014 |
Capital Lease Obligations [Abstract] | |
2015 | $48,899 |
2016 | 37,491 |
2017 | 3,189 |
Total minimum lease payments | 89,579 |
Less: amount representing interest | 10,919 |
Present Value of Net Minimum Lease Payments | $78,660 |
Accounts_Payable_and_Accrued_E2
Accounts Payable and Accrued Expenses - Schedule of Accounts Payable and Accrued Expenses (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Disclosure Text Block [Abstract] | ||
Accounts payable | $3,382,818 | $1,673,933 |
Accrued taxes (VAT, GST, Sales Payroll) | 1,604,829 | 636,568 |
Accrued income taxes | 92,618 | 15,776 |
Accrued interest | 499,866 | 97,384 |
Accounts Payable and Accrued Liabilities, Total | $5,580,131 | $2,423,661 |
Income_Taxes_Details_Narrative
Income Taxes (Details Narrative) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 30, 2013 | Dec. 31, 2013 | |
Income Tax Disclosure [Line Items] | |||
Deferred Tax Assets, Operating Loss Carryforwards, Total | $6,773,713 | $4,495,059 | |
Operating Loss Carryforwards Expiration Period | beginning in 2031 through 2035 | ||
Deferred Tax Assets, Capital Loss Carryforwards | 488,500 | 488,500 | |
Capital Loss Carryforwards Expiration Period | between 2015 and 2017 | ||
Change in valuation allowance | 1,151,691 | 896,964 | 896,964 |
Liability related to expected to decrease in uncertain tax positions | 419,301 | ||
Undistributed earning | 515,000 | ||
Beginning 2015 To 2017 [Member] | |||
Income Tax Disclosure [Line Items] | |||
Deferred Tax Assets, Capital Loss Carryforwards | 1,286,000 | ||
U.S. Federal and State [Member] | |||
Income Tax Disclosure [Line Items] | |||
Deferred Tax Assets, Operating Loss Carryforwards, Total | 15,660,000 | 10,666,000 | |
Foreign Tax Authority [Member] | |||
Income Tax Disclosure [Line Items] | |||
Foreign operating loss carryovers net | 2,751,000 | 1,727,000 | |
Foreign Tax Authority [Member] | Hungary [Member] | |||
Income Tax Disclosure [Line Items] | |||
Foreign operating loss carryovers net | 735,000 | 464,000 | |
Foreign Tax Authority [Member] | South Africa [Member] | |||
Income Tax Disclosure [Line Items] | |||
Foreign operating loss carryovers net | 1,735,000 | 1,263,000 | |
Foreign Tax Authority [Member] | Australia [Member] | |||
Income Tax Disclosure [Line Items] | |||
Foreign operating loss carryovers net | $281,000 |
Income_Taxes_Schedule_of_Incom
Income Taxes - Schedule of Income before Income Tax, Domestic and Foreign (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Income Loss Before Income Tax Domestic And Foreign [Line Items] | ||
Loss from continuing operations before income taxes | $6,202,374 | $5,287,094 |
Domestic Tax Authority [Member] | ||
Income Loss Before Income Tax Domestic And Foreign [Line Items] | ||
Loss from continuing operations before income taxes | 5,442,499 | 636,651 |
Foreign Tax Authority [Member] | ||
Income Loss Before Income Tax Domestic And Foreign [Line Items] | ||
Loss from continuing operations before income taxes | $759,875 | $4,650,443 |
Income_Taxes_Schedule_of_Compo
Income Taxes - Schedule of Components of Income Tax Expense (Benefit) (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 30, 2013 | Dec. 31, 2013 | |
Income Tax Disclosure [Abstract] | |||
Current | $55,486 | $40,935 | |
Deferred | -267,960 | -167,554 | |
Current | 318 | ||
Deferred | -1,266,980 | -652,624 | |
Current | |||
Deferred | -149,056 | -76,786 | |
Change in valuation allowance | 1,151,691 | 896,964 | 896,964 |
Income tax provision | ($476,501) | $40,935 |
Income_Taxes_Schedule_of_Effec
Income Taxes - Schedule of Effective Income Tax Rate Reconciliation(Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 30, 2013 | Dec. 31, 2013 | |
Income Tax Disclosure [Abstract] | |||
Computed "expected" income tax expense benefit | ($2,093,584) | ($1,797,612) | |
State Income Taxes, net of federal benefit | -205,177 | -211,484 | |
Foreign Rate Differential | 45,883 | -79,399 | |
Prior year deferred tax adjustment | 1,083,075 | ||
Prior year true-ups other deferred tax balances | 106,236 | ||
Travel, entertainment and other | 91,045 | 537,988 | |
Deferred taxes from acquisitions | -388,597 | ||
Fixed Asset DTL True-Up | 305,796 | ||
Other | 121,609 | ||
Change in Valuation Allowance | 1,151,691 | 896,964 | 896,964 |
Effective Rate | ($476,501) | $40,935 |
Income_Taxes_Schedule_of_Defer
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Income Tax Disclosure [Abstract] | ||
Net operating loss carryovers | $6,773,713 | $4,495,059 |
Capital loss carryforwards | 488,500 | 488,500 |
Investments | -84,384 | 0 |
Derivative Liability | 372,931 | 645,500 |
Warrants | 184,800 | |
Australian equity investment | -26,417 | 53,132 |
Deferred Occupancy Liabilities | 388,114 | 378,521 |
Total deferred Tax Assets | 7,912,457 | 6,245,512 |
Property and equipment | -469,986 | -278,868 |
Convertible debt | -372,931 | -645,500 |
Intangibles | -957,229 | -1,061,844 |
Goodwill | -47,492 | |
Total deferred tax liabilities | -1,847,638 | -1,986,212 |
Net deferred tax assets | 6,064,819 | 4,259,300 |
Valuation allowance | -6,751,703 | -5,600,012 |
Net deferred tax assets | ($686,884) | ($1,340,712) |
Income_Taxes_Schedule_of_Uncer
Income Taxes - Schedule of Uncertain Tax Positions (Details) (USD $) | 12 Months Ended |
Dec. 31, 2014 | |
Balance at the beginning | |
Increases related to prior year tax positions | 419,301 |
Decreases related to prior year tax positions | |
Increases related to current year tax positions | |
Settlements during the period | |
Lapse of statute of limitations | |
Balance at the end | 419,301 |
Unrecognized Tax Benefit [Member] | |
Balance at the beginning | |
Increases related to prior year tax positions | 419,301 |
Decreases related to prior year tax positions | |
Increases related to current year tax positions | |
Settlements during the period | |
Lapse of statute of limitations | |
Balance at the end | 419,301 |
Interest and Penalties [Member] | |
Balance at the beginning | |
Increases related to prior year tax positions | |
Decreases related to prior year tax positions | |
Increases related to current year tax positions | |
Settlements during the period | |
Lapse of statute of limitations | |
Balance at the end |
Stockholders_Equity_Details_Na
Stockholders' Equity (Details Narrative) (USD $) | 0 Months Ended | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | 1 Months Ended | |||||||||||||||
Sep. 09, 2014 | Mar. 19, 2014 | Nov. 07, 2013 | Nov. 30, 2014 | Oct. 31, 2014 | Nov. 26, 2013 | Oct. 31, 2013 | Sep. 30, 2013 | Apr. 22, 2013 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Oct. 17, 2013 | Jan. 31, 2014 | Apr. 02, 2014 | Dec. 11, 2013 | Dec. 10, 2013 | Nov. 05, 2013 | Feb. 03, 2014 | |
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Common stock, shares authorized | 45,000,000 | 45,000,000 | 45,000,000 | ||||||||||||||||||
Stock issued during period, shares, new issues | 160,000 | 87,500 | 58,764 | 96,150 | |||||||||||||||||
Equity issuance price per share | $2 | ||||||||||||||||||||
Number of common stock warrants issued during period | 26,250 | ||||||||||||||||||||
Class of warrant or right, warrant exercise price | $5.25 | $3.50 | $5.50 | $3.50 | $3.50 | $3.50 | $3.50 | ||||||||||||||
Stock issued during period, shares, issued for services | 15,000 | 25,000 | 4,000 | ||||||||||||||||||
Stock issued during period, value, issued for services | $62,500 | $117,000 | $7,720 | $569,988 | |||||||||||||||||
Stock issued during period, value, new issuance | 175,000 | 228,857 | 3,073,397 | ||||||||||||||||||
Proceeds from issuance of warrants | 349,544 | ||||||||||||||||||||
Proceeds from issuance of private placement | 641,000 | 200,000 | |||||||||||||||||||
Sale of stock transaction during period | 320,500 | ||||||||||||||||||||
Warrants term | 5 years | 5 years | 5 years | 5 years | |||||||||||||||||
Business acquisition, percentage of voting interests acquired | 100.00% | ||||||||||||||||||||
Business acquisition, acquired entity costs purchase price | 550,000 | ||||||||||||||||||||
Total contribution amount | 250,000 | ||||||||||||||||||||
Business acquisition cash amount | 300,000 | 350,000 | 3,740,000 | ||||||||||||||||||
Business acquistion shares | 146,628 | ||||||||||||||||||||
Proceeds from convertible debt | 500,000 | 2,200,000 | |||||||||||||||||||
Percentage of secured subordinate convertible | 15.00% | ||||||||||||||||||||
Percentage of purchase shares | 30.00% | ||||||||||||||||||||
Warrants issued to purchase common stock | 50,000 | ||||||||||||||||||||
Expense related to share issuance | 93,600 | ||||||||||||||||||||
Common stock, par value | $0.00 | $0.00 | $0.00 | ||||||||||||||||||
Conversion of debt into shares value | 500,000 | ||||||||||||||||||||
Equity method investment ownership percentage | 49.00% | ||||||||||||||||||||
Class Of Warrants One [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Class of warrant or right, warrant exercise price | 5.5 | ||||||||||||||||||||
Stock issued during period, value, new issuance | 80,000 | ||||||||||||||||||||
Class Of Warrants Two [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Class of warrant or right, warrant exercise price | 7 | ||||||||||||||||||||
Stock issued during period, value, new issuance | 80,000 | ||||||||||||||||||||
Several Investor Relations [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Stock issued during period, shares, new issues | 40,000 | ||||||||||||||||||||
Stock issued during period, shares, issued for services | 98,764 | ||||||||||||||||||||
Stock issued during period, value, issued for services | 330,757 | ||||||||||||||||||||
Stock issued during period, value, new issuance | 101,900 | ||||||||||||||||||||
Investors [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Stock issued during period, shares, new issues | 666,667 | ||||||||||||||||||||
Stock issued during period, value, new issuance | 2,500,000 | ||||||||||||||||||||
Hooters Pacific NW [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Class of warrant or right, warrant exercise price | $5.50 | ||||||||||||||||||||
Warrants term | 5 years | ||||||||||||||||||||
Business acquisition cash amount | |||||||||||||||||||||
Noncash or part noncash acquisition, noncash financial or equity instrument consideration, common stock and warrants issued, shares | 680,272 | ||||||||||||||||||||
Warrants issued to purchase common stock | 340,136 | ||||||||||||||||||||
Remaining warrants issued to purchase of common stock | 340,136 | ||||||||||||||||||||
Remaining warrants exercisable price per share | $7 | ||||||||||||||||||||
Spoon [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Class of warrant or right, warrant exercise price | $5.50 | ||||||||||||||||||||
Warrants term | 5 years | ||||||||||||||||||||
Business acquisition cash amount | |||||||||||||||||||||
Noncash or part noncash acquisition, noncash financial or equity instrument consideration, common stock and warrants issued, shares | 195,000 | ||||||||||||||||||||
Warrants issued to purchase common stock | 97,500 | ||||||||||||||||||||
Remaining warrants issued to purchase of common stock | 97,500 | ||||||||||||||||||||
Remaining warrants exercisable price per share | $7 | ||||||||||||||||||||
American Roadside Burgers, Inc [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Class of warrant or right issued | 1,710,077 | ||||||||||||||||||||
Common stock, par value | $5 | ||||||||||||||||||||
Stock issued | 3,611,126 | ||||||||||||||||||||
Issuance of units, consists of shares and warrant | 740,000 | ||||||||||||||||||||
Equity method investment ownership percentage | 100.00% | ||||||||||||||||||||
American Roadside Burgers [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Business acquisition cash amount | |||||||||||||||||||||
Equity method investment ownership percentage | 100.00% | ||||||||||||||||||||
Just Fresh [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Business acquisition, percentage of voting interests acquired | 56.00% | 56.00% | |||||||||||||||||||
Business acquisition, acquired entity costs purchase price | 30,000 | 560,000 | |||||||||||||||||||
Business acquisition cash amount | 590,000 | ||||||||||||||||||||
Equity method investment ownership percentage | 5.00% | 51.00% | |||||||||||||||||||
Private Placement [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Stock issued during period, shares, new issues | 15,000 | ||||||||||||||||||||
Class of warrant or right, warrant exercise price | 5 | ||||||||||||||||||||
Stock issued during period, value, new issuance | 800,000 | ||||||||||||||||||||
Sale of stock transaction during period | 137,500 | ||||||||||||||||||||
Warrants term | 5 years | ||||||||||||||||||||
Warrants issued to purchase common stock | 80,000 | ||||||||||||||||||||
Fees and commissions | 32,000 | 150,000 | |||||||||||||||||||
Issuance of units, price per unit | 5 | $3.75 | |||||||||||||||||||
Conversion of debt into shares | 80,000 | ||||||||||||||||||||
Conversion of debt into shares value | 312,000 | ||||||||||||||||||||
Class of warrant or right value of securities called by warrants or rights | 312,000 | ||||||||||||||||||||
Right to Purchase Agreement [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Stock issued during period, shares, new issues | 53,334 | ||||||||||||||||||||
Stock issued during period, value, new issuance | 260,000 | ||||||||||||||||||||
Beacher's Subscription Agreement [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Total contribution amount | 500,000 | ||||||||||||||||||||
Equity method investment ownership percentage | 10.00% | ||||||||||||||||||||
Transaction One [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Stock issued during period, shares, new issues | 11,101 | ||||||||||||||||||||
Equity issuance price per share | $2 | ||||||||||||||||||||
Number of common stock warrants issued during period | 3,330 | ||||||||||||||||||||
Class of warrant or right, warrant exercise price | $3.50 | $3.50 | |||||||||||||||||||
Class of warrant or right issued | 22,202 | ||||||||||||||||||||
Transaction Two [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Stock issued during period, shares, new issues | 20,750 | ||||||||||||||||||||
Equity issuance price per share | $2 | ||||||||||||||||||||
Number of common stock warrants issued during period | 6,225 | ||||||||||||||||||||
Class of warrant or right, warrant exercise price | $3.50 | $3.50 | |||||||||||||||||||
Class of warrant or right issued | 41,500 | ||||||||||||||||||||
Transaction Three [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Stock issued during period, shares, issued for services | 54,837 | ||||||||||||||||||||
Stock issued during period, value, issued for services | 108,855 | ||||||||||||||||||||
Transaction Four [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Equity issuance price per share | $1.80 | ||||||||||||||||||||
Stock shares issued during period for directors fee | 66,000 | ||||||||||||||||||||
Stock shares issued during period for directors fee, shares | 36,667 | ||||||||||||||||||||
Transaction Five [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Equity issuance price per share | $2 | ||||||||||||||||||||
Commons stock shares issued during period for accrued interest | 13,561 | ||||||||||||||||||||
Commons stock shares issued during period for accrued interest,shares | 67,807 | ||||||||||||||||||||
Transaction Six [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Equity issuance price per share | $1.73 | ||||||||||||||||||||
Stock shares issued during period for employee contractual bonus | $25,000 | ||||||||||||||||||||
Stock shares issued during period for employee contractual bonus, shares | 14,451 | ||||||||||||||||||||
2014 Stock Incentive Plan [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Number of shares available for future issuance | 4,000,000 | ||||||||||||||||||||
Minimum [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Common stock, shares authorized | 20,000,000 | ||||||||||||||||||||
Class of warrant or right, warrant exercise price | $2 | ||||||||||||||||||||
Minimum [Member] | Hooters Pacific NW [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Class of warrant or right, warrant exercise price | $5.50 | $5.50 | |||||||||||||||||||
Minimum [Member] | Spoon [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Class of warrant or right, warrant exercise price | $5.50 | $5.50 | |||||||||||||||||||
Minimum [Member] | Transaction Three [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Equity issuance price per share | $1.79 | ||||||||||||||||||||
Maximum [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Common stock, shares authorized | 45,000,000 | ||||||||||||||||||||
Class of warrant or right, warrant exercise price | $7 | ||||||||||||||||||||
Maximum [Member] | Hooters Pacific NW [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Class of warrant or right, warrant exercise price | $7 | $7 | |||||||||||||||||||
Maximum [Member] | Spoon [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Class of warrant or right, warrant exercise price | $7 | $7 | |||||||||||||||||||
Maximum [Member] | Transaction Three [Member] | |||||||||||||||||||||
Stockholder's Equity [Line Items] | |||||||||||||||||||||
Equity issuance price per share | $2.07 |
Stockholders_Equity_Schedule_o
Stockholders' Equity - Schedule of Warrants Activity (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Equity [Abstract] | ||
Number of Warrants Outstanding beginning balance, shares | 5,501,458 | |
Granted, shares | 3,584,118 | 5,501,458 |
Exercised, shares | -174,772 | |
Forfeited, shares | -195,000 | |
Number of Warrants Outstanding ending balance, shares | 8,715,804 | 5,501,458 |
Exercisable, shares | 8,715,804 | |
Weighted-average exercise price, Outstanding beginning balance | $5.46 | |
Weighted-average exercise price, Granted | $4.97 | $5.46 |
Weighted-average exercise price, Exercised | $2 | |
Weighted-average exercise price, Forfeited | $6.25 | |
Weighted-average exercise price, Outstanding ending balance | $5.49 | $5.46 |
Exercisable, Weighted-average exercise price | $5.49 | |
Weighted Average Remaining Life In Years, Outstanding | 3 years | |
Weighted Average Remaining Life In Years, Exercisable | 3 years |
Stockholders_Equity_Schedule_o1
Stockholders' Equity - Schedule of Warrants Outstanding (Details) (USD $) | 12 Months Ended |
Dec. 31, 2014 | |
Warrants outstanding, Weighted-average remaining contractual life ( in years) | 3 years |
Warrants [Member] | |
Number of warrants, outstanding | 8,715,804 |
Number of warrants exercisable | 8,715,804 |
Range 1 [Member] | Warrants [Member] | |
Range of exercise prices, upper limit | 5 |
Number of warrants, outstanding | 3,554,514 |
Warrants outstanding, Weighted-average remaining contractual life ( in years) | 2 years 9 months 18 days |
Number of warrants exercisable | 3,554,514 |
Range 2 [Member] | Warrants [Member] | |
Range of exercise prices, lower limit | 4 |
Range of exercise prices, upper limit | 5 |
Number of warrants, outstanding | 3,935,117 |
Warrants outstanding, Weighted-average remaining contractual life ( in years) | 3 years |
Number of warrants exercisable | 3,935,117 |
Range 3 [Member] | Warrants [Member] | |
Range of exercise prices, lower limit | 3 |
Range of exercise prices, upper limit | 4 |
Number of warrants, outstanding | 963,901 |
Warrants outstanding, Weighted-average remaining contractual life ( in years) | 4 years |
Number of warrants exercisable | 963,901 |
Range 4 [Member] | Warrants [Member] | |
Range of exercise prices, lower limit | 2 |
Range of exercise prices, upper limit | 3 |
Number of warrants, outstanding | 262,272 |
Warrants outstanding, Weighted-average remaining contractual life ( in years) | 3 years |
Number of warrants exercisable | 262,272 |
Stockholders_Equity_Schedule_o2
Stockholders Equity - Schedule of Warrant Amortization (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Equity [Abstract] | ||
Added to additional paid-in capital | $1,107,893 | $657,552 |
Interest expense | 336,798 | 22,659 |
Consulting expense | 771,095 | 634,893 |
Other Additional Capital | $1,107,893 | $657,552 |
Related_Party_Transactions_Det
Related Party Transactions (Details Narrative) (USD $) | 12 Months Ended | 1 Months Ended | 12 Months Ended | |||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2011 | Jun. 30, 2011 | Dec. 31, 2010 | Dec. 31, 2012 | |
Related Party Transaction [Line Items] | ||||||
Net profits amount | ($5,725,873) | ($5,328,029) | ||||
Durban [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Investments in related party | 14,000 | |||||
Percentage of investments in related party | 2.00% | |||||
Johannesburg [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Investments in related party | 12,500 | |||||
Percentage of investments in related party | 1.50% | |||||
Cape Town [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Investments in related party | 25,000 | |||||
Percentage of investments in related party | 2.90% | |||||
Australian Partner [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Loan payable to related parties | 1,087,457 | |||||
Hoa LLC [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Notes receivable, related parties | 3,550,000 | |||||
North American Energy Resources Inc [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Income received for management services shares | 150,000 | |||||
Income received for management services | 10,500 | |||||
Shares contributed for management services | 1,790,440 | |||||
Values contributed for management services | 125,331 | |||||
Avenel Financial Group Inc [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Investments in related party | 49,816 | |||||
Net profits amount | $6,441 |
Related_Party_Transactions_Sch
Related Party Transactions - Schedule of Non-Interest Bearing Loans and Advances from Related Parties (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Related Party Transaction [Line Items] | ||
Due to related parties | $1,299,083 | $12,191 |
Hoot SA I, LLC [Member] | ||
Related Party Transaction [Line Items] | ||
Due to related parties | 12,196 | 12,191 |
Hooters Australia Partner [Member] | ||
Related Party Transaction [Line Items] | ||
Due to related parties | 1,087,451 | |
Chanticleer Investors LLC [Member] | ||
Related Party Transaction [Line Items] | ||
Due to related parties | $199,436 |
Related_Party_Transactions_Sch1
Related Party Transactions - Schedule of Earned Income and Made Advance to Related Parties (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Related Party Transaction [Line Items] | ||
Due from related parties | $46,015 | $116,305 |
Chanticleer Dividend Fund Inc [Member] | ||
Related Party Transaction [Line Items] | ||
Due from related parties | 69,281 | |
Chanticleer Investors [Member] | ||
Related Party Transaction [Line Items] | ||
Due from related parties | 1,207 | |
Hoot Sa Ii and Iv Llc [Member] | ||
Related Party Transaction [Line Items] | ||
Due from related parties | $46,015 | $45,817 |
Segments_of_Business_Summary_o
Segments of Business - Summary of Revenues, Operating Loss, Long-Lived Assets By Geographic Area (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Segment Reporting Information [Line Items] | ||
Revenue: | $29,843,434 | $8,247,487 |
Operating loss: | -5,544,308 | -4,606,355 |
Long Lived Assets: | 34,323,074 | 18,374,473 |
United States [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenue: | 12,941,648 | 987,285 |
Operating loss: | -4,886,279 | -3,931,276 |
Long Lived Assets: | 15,299,108 | 13,661,243 |
South Africa [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenue: | 6,632,024 | 5,738,974 |
Operating loss: | -373,558 | -386,168 |
Long Lived Assets: | 2,172,528 | 2,191,584 |
Australia [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenue: | 5,613,381 | |
Operating loss: | -277,557 | |
Long Lived Assets: | 13,068,305 | 1,434,128 |
Europe [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenue: | 4,656,381 | 1,521,228 |
Operating loss: | -6,914 | -288,911 |
Long Lived Assets: | 3,648,133 | 941,963 |
Brazil [Member] | ||
Segment Reporting Information [Line Items] | ||
Long Lived Assets: | $135,000 | $145,555 |
Commitments_and_Contingencies_1
Commitments and Contingencies (Details Narrative) (USD $) | 0 Months Ended | 12 Months Ended | |
Mar. 17, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | |
Commitments and Contingencies Disclosure [Line Items] | |||
Operating Leases, Rent Expense | $2,651,121 | $868,285 | |
Litigation Settlement, Amount | 850,000 | ||
Settlement of debt | 837,500 | ||
Loss Contingency, Estimated Recovery from Third Party | Rolalor and Labyrinth, be wound up in satisfaction of an alleged debt owed in the total amount of R4,082,636 (approximately $480,000). | ||
Debt owned amount | 480,000 | ||
South Africa [Member] | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Number of Restaurants | 6 | ||
Australia [Member] | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Number of Restaurants | 5 | ||
United States Subsidiaries [Member] | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Number of Restaurants | 15 | ||
Hungary [Member] | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Number of Restaurants | 1 | ||
Lease Term | 10 years | ||
United States [Member] | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Number of Restaurants | 14 | ||
Restaurants [Member] | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Operating Leases, Rent Expense | 2,625,351 | 833,546 | |
Non Restaurants [Member] | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Operating Leases, Rent Expense | 25,770 | 34,739 | |
Creason Associates, PLLC [Member] | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Litigation Settlement, Amount | $12,500 | ||
Minimum [Member] | United States [Member] | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Lease Term | 2 years | ||
Maximum [Member] | United States [Member] | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Lease Term | 10 years |
Commitments_and_Contingencies_2
Commitments and Contingencies - Schedule of Rent Obligations (Details) (USD $) | Dec. 31, 2014 |
Commitments and Contingencies Disclosure [Abstract] | |
12/31/15 | $2,903,180 |
12/31/16 | 2,721,092 |
12/31/17 | 2,203,637 |
12/31/18 | 2,193,450 |
12/31/19 | 2,060,853 |
thereafter | 6,656,486 |
Totals | $18,738,698 |
Disclosures_About_Fair_Value_S
Disclosures About Fair Value - Schedule of Fair Value of Measured Assets and Liabilities (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Fair Value Disclosure [Line Items] | ||
Available-for-sale securities | $35,362 | $55,112 |
Embedded conversion feature | 1,610,900 | 2,146,000 |
Quoted Prices In Active Markets Of Identical Assets (Level 1) [Member] | ||
Fair Value Disclosure [Line Items] | ||
Available-for-sale securities | 35,362 | 55,112 |
Embedded conversion feature | ||
Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value Disclosure [Line Items] | ||
Available-for-sale securities | ||
Embedded conversion feature | ||
Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value Disclosure [Line Items] | ||
Available-for-sale securities | ||
Embedded conversion feature | $1,610,900 | $2,146,000 |
Disclosures_About_Fair_Value_S1
Disclosures About Fair Value - Summary of Changes in Fair Value (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Beginning balance | $2,146,000 | ||
Change in fair value of derivative liability | -1,227,600 | -119,600 | |
Amount included in debt discounts | 1,026,800 | 2,115,400 | |
Included in interest | 150,200 | ||
Ending balance | 1,945,200 | 2,146,000 | |
Warrants [Member] | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Beginning balance | |||
Change in fair value of derivative liability | -292,600 | ||
Amount included in debt discounts | 626,900 | ||
Ending balance | 334,300 | ||
Conversion Feature [Member] | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Beginning balance | 2,146,000 | ||
Change in fair value of derivative liability | -935,000 | -119,600 | |
Amount included in debt discounts | 399,900 | 2,115,400 | |
Included in interest | 150,200 | ||
Ending balance | $1,610,900 | $2,146,000 |
Subsequent_Events_Details_Narr
Subsequent Events (Details Narrative) (USD $) | 0 Months Ended | 1 Months Ended | 12 Months Ended | 0 Months Ended | 1 Months Ended | 0 Months Ended | 1 Months Ended | ||||||||
Mar. 19, 2014 | Apr. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2014 | Mar. 13, 2015 | Mar. 16, 2015 | Jan. 31, 2015 | Mar. 15, 2015 | Feb. 28, 2015 | Nov. 30, 2014 | Oct. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Dec. 31, 2013 | Mar. 31, 2015 | |
Notes team | 10 years | 5 years | |||||||||||||
Proceeds from issuance of convertible debt | $500,000 | $2,200,000 | |||||||||||||
Class of warrant or right, warrant exercise price | $5.25 | $3.50 | $3.50 | $5.50 | $3.50 | $3.50 | |||||||||
Common stock, par value | $0.00 | $0.00 | |||||||||||||
Minimum [Member] | |||||||||||||||
Class of warrant or right, warrant exercise price | $2 | ||||||||||||||
Maximum [Member] | |||||||||||||||
Class of warrant or right, warrant exercise price | $7 | ||||||||||||||
Subsequent Event [Member] | |||||||||||||||
Accrued interest | 250,000 | ||||||||||||||
Convert accrued interest to common stock | 168,713 | ||||||||||||||
Number of units sold to private offering | $20 | ||||||||||||||
Proceeds from convertible debt and warrants | 1,000,000 | ||||||||||||||
Debt conversion percentage | 8.00% | ||||||||||||||
Convertible promissory note face value | 1,000,000 | 50,000 | |||||||||||||
Warrant to purchase of common stock | 320,000 | 12,500 | |||||||||||||
Percentage of perpetuity of monthly net income | 50.00% | ||||||||||||||
Percentage of sales proceeds | 60.00% | ||||||||||||||
Notes team | 3 years | ||||||||||||||
Debt conversion description | The note may be voluntarily converted by the holder into shares of common stock during the period commencing 180 days after the issuance of the notes at an exercise price equal to the lesser of $2.00 per share and a 15% discount to the average of the lowest 3 trading prices for the Company’s common stock during the 10 trading day period ending on the last complete trading day prior to the conversion date of the note, provided however that the conversion price shall not be less than $1.00 per share. The Warrants have an exercise price of $2.50 per share and a term of five years. In conjunction with the sale of the units, the Company also entered into a registration rights agreement pursuant to which the Company agreed to register the shares of common stock underlying the notes and warrants. | ||||||||||||||
Warrant term | 5 years | ||||||||||||||
Class of warrant or right, warrant exercise price | $2.50 | ||||||||||||||
Number of common stock issued for subscriptions | 3,899,742 | ||||||||||||||
Proceeds from receiving subscriptions | 7,799,484 | ||||||||||||||
Subsequent Event [Member] | BGR The Burger Joint [Member] | |||||||||||||||
Punchase price consisting cash | 4,000,000 | ||||||||||||||
Number of shares to contractual working capital adjustment | 500,000 | ||||||||||||||
Subsequent Event [Member] | BGR The Burger Joint [Member] | Minimum [Member] | |||||||||||||||
Working capital adjustment to increase cash | 200,000 | ||||||||||||||
Subsequent Event [Member] | BGR The Burger Joint [Member] | Maximum [Member] | |||||||||||||||
Working capital adjustment to increase cash | 250,000 | ||||||||||||||
Subsequent Event [Member] | BT Burger Joint [Member] | |||||||||||||||
Common stock, par value | $0.00 | ||||||||||||||
Subsequent Event [Member] | Convertible Debt One [Member] | |||||||||||||||
Accrued interest | 500,000 | ||||||||||||||
Convert accrued interest to common stock | 373,333 | ||||||||||||||
Subsequent Event [Member] | Convertible Debt Two [Member] | |||||||||||||||
Accrued interest | 100,000 | ||||||||||||||
Convert accrued interest to common stock | 100,000 | ||||||||||||||
Subsequent Event [Member] | Two Investors [Member] | |||||||||||||||
Number of warrants issued during period | 250,000 | ||||||||||||||
Debt conversion percentage | 8.00% | ||||||||||||||
Warrant to purchase of common stock | 37,500 | ||||||||||||||
Proceeds from issuance of convertible debt | $150,000 | ||||||||||||||
Common stock price per share | $2.50 |