Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2019 | Nov. 06, 2019 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | ONE GROUP HOSPITALITY, INC. | |
Entity Central Index Key | 0001399520 | |
Trading Symbol | stks | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2019 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Entity Current Reporting Status | Yes | |
Amendment Flag | false | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 28,872,952 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 2,046 | $ 1,592 |
Accounts receivable | 6,083 | 7,029 |
Inventory | 1,602 | 1,404 |
Other current assets | 1,802 | 1,471 |
Due from related parties, net | 336 | 45 |
Total current assets | 11,869 | 11,541 |
Property and equipment, net | 39,996 | 39,347 |
Operating lease right-of-use assets | 39,751 | |
Investments | 2,684 | 2,684 |
Deferred tax assets, net | 11 | 38 |
Other assets | 362 | 349 |
Security deposits | 747 | 2,020 |
Total assets | 95,420 | 55,979 |
Current liabilities: | ||
Accounts payable | 4,934 | 5,408 |
Accrued expenses | 4,302 | 8,093 |
Deferred license revenue | 191 | 171 |
Deferred gift card revenue and other | 599 | 947 |
Current portion of operating lease liabilities | 2,488 | |
Current portion of long-term debt | 1,076 | 3,201 |
Total current liabilities | 13,590 | 17,820 |
Deferred license revenue, long-term | 951 | 1,008 |
Due to related parties, long-term | 1,197 | |
Operating lease liabilities, net of current portion | 54,775 | |
Deferred rent and tenant improvement allowances | 16,774 | |
Long-term debt, net of current portion | 12,255 | 7,118 |
Total liabilities | 81,571 | 43,917 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Common stock, $0.0001 par value, 75,000,000 shares authorized; 28,577,487 and 28,313,017 shares issued and outstanding at September 30, 2019 and December 31, 2018, respectively | 3 | 3 |
Preferred stock, $0.0001 par value, 10,000,000 shares authorized; no shares issued and outstanding at September 30, 2019 and December 31, 2018, respectively | ||
Additional paid-in capital | 44,584 | 43,543 |
Accumulated deficit | (27,730) | (28,722) |
Accumulated other comprehensive loss | (2,639) | (2,310) |
Total stockholders' equity | 14,218 | 12,514 |
Noncontrolling interests | (369) | (452) |
Total equity | 13,849 | 12,062 |
Total liabilities and equity | $ 95,420 | $ 55,979 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parentheticals) - $ / shares | Sep. 30, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Common stock, par value per share (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 75,000,000 | 75,000,000 |
Common stock, shares issued | 28,577,487 | 28,313,017 |
Common stock, shares outstanding | 28,577,487 | 28,313,017 |
Preferred stock, par value per share (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Revenues: | ||||
Owned restaurant net revenues | $ 17,120 | $ 15,312 | $ 53,749 | $ 45,908 |
Owned food, beverage and other net revenues | 2,065 | 1,960 | 6,472 | 6,048 |
Total owned revenue | 19,185 | 17,272 | 60,221 | 51,956 |
Management, license and incentive fee revenue | 2,921 | 2,688 | 8,260 | 7,832 |
Total revenues | 22,106 | 19,960 | 68,481 | 59,788 |
Owned restaurants: | ||||
Owned restaurant cost of sales | 4,472 | 4,050 | 14,109 | 12,121 |
Owned restaurant operating expenses | 10,783 | 9,779 | 33,554 | 28,556 |
Total owned restaurant expenses | 15,255 | 13,829 | 47,663 | 40,677 |
Owned food, beverage and other expenses | 1,971 | 2,068 | 6,455 | 5,782 |
Total owned operating expenses | 17,226 | 15,897 | 54,118 | 46,459 |
General and administrative (including stock-based compensation of $338, $337, $975 and $1,005 for the three and nine months ended September 30, 2019 and 2018 respectively) | 2,352 | 2,266 | 7,706 | 7,937 |
Depreciation and amortization | 1,103 | 896 | 3,049 | 2,575 |
Lease termination expenses | 252 | 78 | 393 | 168 |
Pre-opening expenses | 449 | 545 | 1,330 | |
Transaction costs | 358 | 510 | ||
Equity in income of investee companies | (111) | |||
Other expense (income), net | 40 | 38 | (226) | (139) |
Total costs and expenses | 21,331 | 19,624 | 66,095 | 58,219 |
Operating income | 775 | 336 | 2,386 | 1,569 |
Other expenses, net: | ||||
Interest expense, net of interest income | 230 | 294 | 717 | 902 |
Loss on early debt extinguishment | 437 | |||
Total other expenses, net | 230 | 294 | 1,154 | 902 |
Income before provision for income taxes | 545 | 42 | 1,232 | 667 |
Provision for income taxes | 76 | 251 | 157 | 445 |
Net income (loss) | 469 | (209) | 1,075 | 222 |
Less: net income attributable to noncontrolling interest | 9 | 96 | 83 | 116 |
Net income (loss) attributable to The ONE Group Hospitality, Inc. | 460 | (305) | 992 | 106 |
Currency translation loss | (40) | (170) | (329) | (104) |
Comprehensive income (loss) | $ 420 | $ (475) | $ 663 | $ 2 |
Net income (loss) attributable to The ONE Group Hospitality, Inc. per share: | ||||
Basic net income (loss) per share | $ 0.02 | $ (0.01) | $ 0.03 | $ 0 |
Diluted net income (loss) per share | $ 0.02 | $ (0.01) | $ 0.03 | $ 0 |
Shares used in computing basic earnings per share (in shares) | 28,537,477 | 27,751,632 | 28,429,074 | 27,437,269 |
Shares used in computing diluted earnings per share (in shares) | 29,901,144 | 27,751,632 | 29,642,926 | 27,499,645 |
CONSOLIDATED STATEMENTS OF OP_2
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (Unaudited) (Parentheticals) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Income Statement [Abstract] | ||||
Stock-based compensation | $ 338 | $ 337 | $ 975 | $ 1,005 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands | Common stock | Additional paid-in capital | Accumulated deficit | Accumulated other comprehensive loss | Stockholders' equity | Noncontrolling Interests | Total |
Balance at Dec. 31, 2017 | $ 3 | $ 41,007 | $ (31,979) | $ (1,556) | $ (922) | $ 6,553 | |
Stock-based compensation | 324 | 324 | |||||
Loss on foreign currency translation, net | (75) | (75) | |||||
Balance at Mar. 31, 2018 | 3 | 41,331 | (31,802) | (1,631) | (1,035) | 6,866 | |
Balance at Dec. 31, 2017 | 3 | 41,007 | (31,979) | (1,556) | (922) | 6,553 | |
Net income | 222 | ||||||
Balance at Sep. 30, 2018 | 3 | 43,235 | (31,927) | (1,660) | (806) | 8,845 | |
Balance at Mar. 31, 2018 | 3 | 41,331 | (31,802) | (1,631) | (1,035) | 6,866 | |
Stock-based compensation | 344 | 344 | |||||
Loss on foreign currency translation, net | 141 | 141 | |||||
Balance at Jun. 30, 2018 | 3 | 41,675 | (31,621) | (1,490) | (902) | 7,665 | |
Stock-based compensation | 337 | 337 | |||||
Exercise of warrants | 1,223 | 1,223 | |||||
Loss on foreign currency translation, net | (68) | (68) | |||||
Net income | (209) | ||||||
Balance at Sep. 30, 2018 | 3 | 43,235 | (31,927) | (1,660) | (806) | 8,845 | |
Balance at Dec. 31, 2018 | $ 3 | 43,543 | (28,722) | (2,310) | $ 12,514 | (452) | 12,062 |
Balance (in shares) at Dec. 31, 2018 | 28,313,017 | ||||||
Stock-based compensation | 181 | 181 | |||||
Loss on foreign currency translation, net | (160) | (160) | |||||
Balance at Mar. 31, 2019 | $ 3 | 43,724 | (27,868) | (2,470) | (537) | 12,852 | |
Balance at Dec. 31, 2018 | $ 3 | 43,543 | (28,722) | (2,310) | 12,514 | (452) | 12,062 |
Balance (in shares) at Dec. 31, 2018 | 28,313,017 | ||||||
Stock-based compensation | 975 | 975 | 975 | ||||
Stock-based compensation (in shares) | 47,469 | ||||||
Exercise of stock options | 66 | 66 | $ 66 | ||||
Exercise of stock options (in shares) | 30,000 | 30,000 | |||||
Vesting of restricted shares (in shares) | 187,001 | ||||||
Loss on foreign currency translation, net | (329) | (329) | $ (329) | ||||
Net income | 992 | 992 | 83 | 1,075 | |||
Balance at Sep. 30, 2019 | $ 3 | 44,584 | (27,730) | (2,639) | 14,218 | (369) | 13,849 |
Balance (in shares) at Sep. 30, 2019 | 28,577,487 | ||||||
Balance at Mar. 31, 2019 | $ 3 | 43,724 | (27,868) | (2,470) | (537) | 12,852 | |
Stock-based compensation | 456 | 456 | |||||
Loss on foreign currency translation, net | (120) | (120) | |||||
Balance at Jun. 30, 2019 | 3 | 44,180 | (28,190) | (2,590) | (378) | 13,025 | |
Stock-based compensation | 338 | 338 | |||||
Exercise of stock options | 66 | 66 | |||||
Loss on foreign currency translation, net | (49) | (49) | |||||
Net income | 469 | ||||||
Balance at Sep. 30, 2019 | $ 3 | $ 44,584 | $ (27,730) | $ (2,639) | $ 14,218 | $ (369) | $ 13,849 |
Balance (in shares) at Sep. 30, 2019 | 28,577,487 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Operating activities: | ||
Net income | $ 1,075 | $ 222 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 3,049 | 2,575 |
Stock-based compensation | 975 | 1,005 |
Loss on early debt extinguishment | 437 | |
Amortization of discount on warrants and debt issuance costs | 103 | 150 |
Deferred rent and tenant improvement allowances | 306 | |
Deferred taxes | 27 | (1) |
Income from equity method investments | (111) | |
Gain on disposition of cost method investment | (185) | |
Changes in operating assets and liabilities: | ||
Accounts receivable | 908 | (532) |
Inventory | (198) | 209 |
Other current assets | (332) | (301) |
Due from related parties, net | (291) | (208) |
Security deposits | 1,271 | (59) |
Other assets | (13) | (213) |
Accounts payable | (441) | 496 |
Accrued expenses | (3,951) | (423) |
Operating lease liabilities and right-of-use assets | 489 | |
Deferred revenue | (130) | 477 |
Net cash provided by operating activities | 2,978 | 3,407 |
Investing activities: | ||
Purchase of property and equipment | (3,509) | (3,238) |
Distribution from equity method investment | 40 | |
Proceeds from disposition of cost method investment | 600 | |
Net cash used in investing activities | (3,509) | (2,598) |
Financing activities: | ||
Borrowings on revolving credit facility | 4,750 | |
Repayments of revolving credit facility | (1,000) | |
Borrowings of term loan | 10,000 | |
Repayment of term loans | (4,016) | (2,108) |
Repayment of promissory notes | (6,250) | |
Repayment of due to related parties, long-term | (1,197) | |
Repayment of equipment financing agreement | (277) | (264) |
Repayment of business loan and security agreement | (62) | |
Debt issuance costs | (734) | |
Issuance of common stock | 1,223 | |
Exercise of stock options | 66 | |
Net cash provided by (used in) financing activities | 1,342 | (1,211) |
Effect of exchange rate changes on cash | (357) | (178) |
Net increase (decrease) in cash and cash equivalents | 454 | (580) |
Cash and cash equivalents, beginning of year | 1,592 | 1,548 |
Cash and cash equivalents, end of year | 2,046 | 968 |
Supplemental disclosure of cash flow data: | ||
Interest paid | 779 | 722 |
Income taxes paid | 193 | $ 458 |
Non-cash amortization of debt issuance costs | $ 35 |
Summary of Business and Signifi
Summary of Business and Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Summary of Business and Significant Accounting Policies | Note 1 – Summary of Business and Significant Accounting Policies Summary of Business The ONE Group Hospitality, Inc. and its subsidiaries (collectively, the “Company”) is a global hospitality company that develops, owns and operates, manages or licenses upscale and polished casual, high-energy restaurants and lounges and provides turn-key food and beverage (“F&B”) services for hospitality venues including hotels, casinos and other high-end locations globally. Turn-key F&B services are food and beverage services that can be scaled, customized and implemented by the Company at a particular hospitality venue and customized for the client. As of September 30, 2019, the Company’s primary restaurant brand is STK, a multi-unit steakhouse concept that combines a high-energy, social atmosphere with the quality and service of a traditional upscale steakhouse. As of September 30, 2019, we owned, operated, managed or licensed 29 venues, including 19 STKs, in major metropolitan cities in North America, Europe and the Middle East and provided F&B services to three hotels and one casino in the United States and Europe. Acquisition of Kona Grill On October 4, 2019, the Company acquired substantially all of the assets of Kona Grill, Inc. and its affiliates (“Kona Grill”), comprising 24 Kona Grill domestic restaurants and one international franchise agreement. Kona Grill is a casual, bar-centric concept featuring American favorites, award-winning sushi, and specialty cocktails in a polished casual atmosphere. The Company purchased the assets for $25.0 million in cash and the assumption of approximately $11.0 million in working capital liabilities. The purchase was financed with proceeds from a credit agreement the Company entered into with Goldman Sachs Bank USA in conjunction with the acquisition. Refer to Note 19 – Subsequent Events for additional details regarding the acquisition and related financing. Basis of Presentation The accompanying consolidated balance sheet as of December 31, 2018, which has been derived from audited financial statements, and the accompanying unaudited interim consolidated financial statements of the Company have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and in accordance with accounting principles generally accepted in the United States (“GAAP”). Certain information and footnote disclosures normally included in annual audited financial statements have been omitted pursuant to SEC rules and regulations. These unaudited interim consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10‑K for the year ended December 31, 2018. In the Company’s opinion, the accompanying unaudited interim financial statements reflect all adjustments (consisting only of normal recurring accruals and adjustments) necessary for a fair presentation of the results for the interim periods presented. The results of operations for any interim period are not necessarily indicative of the results expected for the full year. Additionally, the Company believes that the disclosures are sufficient for interim financial reporting purposes. Recent Accounting Pronouncements In July 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Updated (“ASU”) No. 2019‑07, “Codification Updates to SEC Sections – Amendments to SEC Paragraphs Pursuant to SEC Final Rule Releases No. 33-10532, Disclosure Update and Simplification, and Nos. 33-10231 and 33-10442, Investment Company Reporting Modernization and Miscellaneous Updates (SEC Update)” (“ASU 2019‑07”). ASU 2019‑07 updates the accounting standards codification to reflect the amendments of various SEC disclosure requirements that the agency determined were redundant, duplicative, overlapping, outdated or superseded and aligns the guidance with the requirements of certain SEC final rules. ASU 2019‑07 is effective immediately. The adoption of ASU 2019-07 did not have a material impact on our financial position, results of operations or cash flows . In March 2019, the FASB issued ASU No. 2019‑01, “Leases (Topic 842): Codification Improvements” (“ASU 2019‑01”). ASU 2019‑01 provided clarification related to adopting Accounting Standard Codification Topic 842, Leases (“ASC Topic 842”). ASU 2019‑01 addresses fair value determinations of underlying assets by lessors, cash flow statement presentation for financing leases, and transition disclosures. The Company adopted ASC Topic 842 as of January 1, 2019 and considered the clarification guidance in ASU 2019‑01 as part of its adoption. Refer to Note 12 for additional details regarding the adoption of ASC Topic 842. In October 2018, the FASB issued ASU No. 2018‑17, “Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities” (“ASU 2018‑17”). ASU 2018‑17 states that indirect interests held through related parties in common control arrangements should be considered on a proportional basis to determine whether fees paid to decision makers and service providers are variable interests. This is consistent with how indirect interests held through related parties under common control are considered for determining whether a reporting entity must consolidate a variable interest entity. ASU 2018‑17 is effective for annual and interim periods beginning after December 15, 2019, with early adoption permitted. Entities are required to adopt the new guidance retrospectively with a cumulative adjustment to retained earnings at the beginning of the earliest period presented. The Company is evaluating the effects of this pronouncement on its consolidated financial statements. In August 2018, the FASB issued ASU No. 2018‑13, “Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement” (“ASU 2018‑13”). ASU 2018‑13 eliminates, modifies and adds disclosure requirements for fair value measurements. The amendments in ASU 2018‑13 are effective for annual and interim periods beginning after December 15, 2019, with early adoption permitted. The Company is evaluating the effects of ASU 2018‑13 on its consolidated financial statements but does not expect the adoption of ASU 2018‑13 to be material. In August 2018, the FASB issued ASU No. 2018‑15, “Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350‑40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract” (“ASU 2018‑15”). ASU 2018‑15 aligns the requirements for capitalizing implementation costs in cloud computing arrangements with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. ASU 2018‑15 is effective for annual and interim periods beginning after December 15, 2019, with early adoption permitted. Entities can choose to adopt the new guidance prospectively or retrospectively. The Company is evaluating the effects of this pronouncement on its consolidated financial statements. |
Inventory
Inventory | 9 Months Ended |
Sep. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Inventory | Note 2 – Inventory Inventory consists of the following (in thousands): September 30, December 31, 2019 2018 Food $ 317 $ 300 Beverages 1,285 1,104 Total $ 1,602 $ 1,404 |
Other Current Assets
Other Current Assets | 9 Months Ended |
Sep. 30, 2019 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other Current Assets | Note 3 – Other Current Assets Other current assets consist of the following (in thousands): September 30, December 31, 2019 2018 Prepaid taxes $ 587 $ 503 Landlord receivable 195 195 Prepaid expenses 926 680 Other 94 93 Total $ 1,802 $ 1,471 |
Property and Equipment, net
Property and Equipment, net | 9 Months Ended |
Sep. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, net | Note 4 – Property and Equipment, net Property and equipment, net consist of the following (in thousands): September 30, December 31, 2019 2018 Furniture, fixtures and equipment $ 12,106 $ 10,425 Leasehold improvements 45,820 43,890 Less: accumulated depreciation and amortization (19,861) (16,969) Subtotal 38,065 37,346 Construction in progress — 336 Restaurant smallwares 1,931 1,665 Total $ 39,996 $ 39,347 Depreciation and amortization related to property and equipment amounted to $1.1 million and $0.9 million for the three months ended September 30, 2019 and 2018, respectively, and $3.0 million and $2.6 million for the nine months ended September 30, 2019 and 2018, respectively. The Company does not depreciate construction in progress, assets not yet put into service or restaurant supplies. |
Accrued Expenses
Accrued Expenses | 9 Months Ended |
Sep. 30, 2019 | |
Accrued [Abstract] | |
Accrued Expenses | Note 5 – Accrued Expenses Accrued expenses consist of the following (in thousands): September 30, December 31, 2019 2018 Variable rent, including disputed rent amounts $ 1,305 $ 1,766 Legal, professional and other services 658 645 Payroll and related 802 1,794 VAT and sales taxes 259 1,028 Insurance 212 212 Income taxes and related 340 685 Due to hotels — 203 Other 726 1,760 Total $ 4,302 $ 8,093 |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Note 6 – Long-Term Debt Long-term debt consists of the following (in thousands): September 30, December 31, 2019 2018 Term loan agreements $ 9,813 $ 3,828 Revolving credit facility 3,750 — Equipment financing agreements 475 752 Promissory notes — 6,250 Total long-term debt 14,038 10,830 Less: current portion of long-term debt (1,076) (3,201) Less: debt issuance costs (707) (32) Less: discounts on warrants, net — (479) Total long-term debt, net of current portion $ 12,255 $ 7,118 Interest expense for all the Company’s debt arrangements, excluding the loss on early debt extinguishment and the amortization of debt issuance costs, other discounts and fees, was approximately $0.2 million and $0.2 million for the three months ended September 30, 2019 and 2018 and $0.6 million and $0.8 million for the nine months ended September 30, 2019 and 2018, respectively. As of September 30, 2019, the Company had $1.7 million in standby letters of credit outstanding for certain restaurants. As of December 31, 2018, the Company had $1.3 million of cash collateralized letters of credit, which are recorded as a component of security deposits on the consolidated balance sheet as of December 31, 2018. Bank of America, N.A. Credit Agreement On May 15, 2019, the Company entered into a Credit Agreement with Bank of America, N.A (“Bank of America Credit Agreement”). The Bank of America Credit Agreement was replaced with the Goldman Sachs Credit Agreement described below on October 4, 2019. The Bank of America Credit Agreement provided for a secured revolving credit facility of $10.0 million and a $10.0 million term loan. The term loan was payable in quarterly installments, with the final payment due in May 2024. The revolving credit facility also matured in May 2024. In conjunction with entering into the Bank of America Credit Agreement, the Company incurred $0.4 million of debt issuance costs, which were capitalized and are recorded as a direct deduction to the long-term debt, net of current portion, on the consolidated balance sheets. The Bank of America Credit Agreement contained several financial covenants, including (a) a maximum consolidated leverage ratio of (i) 4.75 to 1.00 as of the end of any fiscal quarter ending on or prior to June 30, 2020 and (ii) 4.50 to 1.00 as of the end of any fiscal quarter thereafter and (b) a minimum consolidated fixed charge coverage ratio of 1.35 to 1.00. The Bank of America Credit Agreement had several borrowing and interest rate options, including the following: (a) a LIBOR rate (or a comparable successor rate) or (b) a base rate equal to the greater of the prime rate, the federal funds rate plus 0.50% or the LIBOR rate for a one-month period plus 1.00%; provided that the base rate may not be less than zero. Loans under the Bank of America Credit Agreement bore interest at a rate per annum using the applicable indices plus a varying interest rate margin of between 2.75% and 3.50% (for LIBOR rate loans) and 1.75% and 2.50% (for base rate loans). The Bank of America Credit Agreement contained customary representations, warranties and conditions to borrowing including customary affirmative and negative covenants, which include covenants that limit or restrict the Company’s ability to incur indebtedness and other obligations, grant liens to secure obligations, make investments, merge or consolidate, and dispose of assets outside the ordinary course of business, in each case subject to customary exceptions for credit facilities of this size and type. As of September 30, 2019, the Company was in compliance with the covenants required by the Bank of America Credit Agreement. On October 4, 2019, in conjunction with the acquisition of Kona Grill, the Company entered into a Credit and Guaranty Agreement with Goldman Sachs Bank USA (“Goldman Sachs Credit Agreement”), which replaced the Company’s Bank of America Credit Agreement. In the three and nine months ended September 30, 2019, the Company incurred $0.3 million of debt issuance costs related to the Goldman Sachs Credit Agreement, which were capitalized and are recorded as a direct deduction to the long-term debt, net of current portion, on the consolidated balance sheets. Refer to Note 19 – Subsequent Events for additional details regarding the acquisition and related financing. Debt Extinguishment In conjunction with entering into the Bank of America Credit Agreement on May 15, 2019, the Company prepaid the outstanding debt balances to early extinguish the $2.6 million of outstanding term loans with BankUnited, the $5.3 million of outstanding promissory notes with Anson Investments Master Fund LP, and the $1.0 million outstanding promissory note with 2235570 Ontario Limited. The Company recognized a $0.4 million loss on early debt extinguishment within other expenses, net on the consolidated statements of operations and comprehensive income (loss), primarily caused by the recognition of the unamortized discounts related to warrants issued with the promissory notes and the recognition of unamortized debt issuance costs related to the debt extinguished. Additionally, the Company prepaid the $1.2 million of outstanding cash advances due to the TOG Liquidation Trust, a related party. Please refer to Note 9 for additional details on transactions with related parties. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Note 7 – Fair Value of Financial Instruments Cash and cash equivalents, accounts receivable, inventory, accounts payable and accrued expenses are carried at cost, which approximates fair value due to their short maturities. Long-lived assets are measured and disclosed at fair value on a nonrecurring basis if an impairment is identified. There were no long-lived assets measured at fair value as of September 30, 2019. The Company’s long-term debt, including the current portion, is carried at cost on the consolidated balance sheets. Fair value of long-term debt, including the current portion, is estimated based on Level 2 inputs, except the amount outstanding on the revolving credit facility for which the carrying value approximates fair value. Fair value is determined by discounting future cash flows using interest rates available for issues with similar terms and maturities. The estimated fair values of long-term debt, for which carrying values do not approximate fair value, are as follows (in thousands): September 30, December 31, 2019 2018 Carrying amount of long-term debt, including current portion (1) $ 10,288 $ 10,830 Fair value of long-term debt, including current portion $ 8,618 $ 7,648 (1) Excludes the discounts on warrants, net and debt issuance costs |
Nonconsolidated Variable Intere
Nonconsolidated Variable Interest Entities | 9 Months Ended |
Sep. 30, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Nonconsolidated Variable Interest Entities | Note 8 – Nonconsolidated Variable Interest Entities As of September 30, 2019 and December 31, 2018, the Company owned interests in the following companies, which directly or indirectly operate a restaurant: · 31.24% interest in Bagatelle NY LA Investors, LLC (“Bagatelle Investors”) · 51.13% aggregate interest, held directly and indirectly through other entities, in Bagatelle Little West 12th, LLC (“Bagatelle NY”) Bagatelle Investors is a holding company that has an interest in Bagatelle NY. Both entities were formed in 2011. In the second quarter of 2019, Bagatelle NY notified the Company that it had no intent to renew its sublease with the Company for the restaurant space. As a result, the Company determined that it no longer had the ability to exercise significant influence over its investees, Bagatelle Investors and Bagatelle NY. On June 30, 2019, the Company recorded its retained interests in Bagatelle Investors and Bagatelle NY as cost method investments, with the initial basis being the previous carrying amounts of the investments. Prior to June 30, 2019, the Company had accounted for its investments in these entities under the equity method of accounting based on management’s assessment that it was not the primary beneficiary of these entities because it did not have the power to direct their day to day activities. The Company has provided no additional types of support to these entities other than what is contractually required. The carrying values of these investments were as follows (in thousands): September 30, December 31, 2019 2018 Bagatelle Investors $ 56 $ 56 Bagatelle NY 2,628 2,628 Total $ 2,684 $ 2,684 There was no equity in income of investee companies for the three and nine months ended September 30, 2019 and for the three months ended September 30, 2018. For the nine months ended September 30, 2018, the equity in income of investee companies for the equity method investments discussed above was approximately $0.1 million. Additionally, the Company has a management agreement with Bagatelle NY. Under this agreement, the Company recorded less than $0.1 million of management fee revenue in each of the three months ended September 30, 2019 and 2018, respectively, and $0.3 million and $0.2 million for the nine months ended September 30, 2019 and 2018, respectively. The Company also receives rental income from Bagatelle NY for restaurant space that it subleases to Bagatelle NY. Rental income of approximately $0.1 million was recorded from this entity for each of the three months ended September 30, 2019 and 2018 , respectively, and $0.4 million was recorded from this entity for the each of the nine months ended September 30, 2019 and 2018, respectively . Net receivables from the Bagatelle Investors and Bagatelle NY included in due from related parties, net were approximately $0.3 million and $0.1 million as of September 30, 2019 and December 31, 2018, respectively. These receivables, combined with the Company’s equity in each of these investments, represent the Company’s maximum exposure to loss. In the first quarter of 2018, the Company sold its 10% interest in a cost method investment, One 29 Park, LLC, for $0.6 million, resulting in a gain of $0.2 million. The gain is included as a component of other income, net on the consolidated statements of operations and comprehensive income (loss) for the nine months ended September 30, 2018. The investment was accounted for under the cost method of accounting. The Company had also entered into a management agreement with One 29 Park, LLC, under which the Company recorded management fee revenue of $0.1 million and $0.3 million for the three and nine months ended September 30, 2018. The management agreement with One 29 Park, LLC terminated on September 30, 2018. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 9 – Related Party Transactions Net amounts due from related parties were $0.3 million and due to related parties were $1.2 million as of September 30, 2019 and December 31, 2018, respectively. The Company has not reserved any related party receivables as of September 30, 2019 and December 31, 2018. During the fourth quarter of 2016, the Company received approximately $1.2 million in cash advances from the TOG Liquidation Trust. The TOG Liquidation Trust is a trust that was set up in connection with a 2013 merger transaction to hold previously issued and outstanding warrants held by members of the predecessor company. Amounts due to the trust were non-interest bearing and were repayable in 2021 when the trust expires. In conjunction with entering into the Bank of America Credit Agreement on May 15, 2019, the Company prepaid the $1.2 million balance due to the TOG Liquidation Trust. As a result of the prepayment, there was no amount outstanding to the TOG Liquidation Trust as of September 30, 2019. As of December 31, 2018, the $1.2 million balance due to the Liquidation Trust was included in due to related parties, long-term. Please refer to Note 8 for details on other transactions with other related parties, and refer to Note 6 for details related to the Bank of America Credit Agreement. |
Income taxes
Income taxes | 9 Months Ended |
Sep. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Note 10 – Income taxes The Company’s effective income tax rate was 12.7% for the nine months ended September 30 2019 compared to 66.7% for the nine months ended September 30, 2018. The effective income tax rate for the nine months ended September 30, 2019 was lower compared to the nine months ended September 30, 2018 primarily due to the tax rates applied to domestic and foreign income (loss). Additionally, the Company’s projected annual effective tax rate differs from the statutory U.S. tax rate of 21% primarily due to the following: (i) availability of U.S. net operating loss carryforwards, resulting in no federal income taxes; (ii) a full valuation allowance on the U.S. deferred tax assets, net; (iii) taxes owed in foreign jurisdictions such as the United Kingdom, Canada and Italy; and, (iv) taxes owed in state and local jurisdictions. The Company is subject to income taxes in the U.S. federal jurisdiction, and the various states and local jurisdictions in which it operates. Tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require significant judgment to apply. In the normal course of business, the Company is subject to examination by the federal, state, local and foreign taxing authorities. |
Revenue from contracts with cus
Revenue from contracts with customers | 9 Months Ended |
Sep. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from contracts with customers | Note 11 – Revenue from contracts with customers The following table provides information about contract receivables and liabilities, which include deferred license revenue and deferred gift card and gift certificate revenue, from contracts with customers (in thousands): September 30, December 31, 2019 2018 Receivables (1) $ 125 $ 174 Deferred license revenue (2) 1,142 1,179 Deferred gift card and gift certificate revenue (3) $ 137 $ 491 (1) Receivables are included in accounts receivable on the consolidated balance sheets. (2) Includes the current and long-term portion of deferred license revenue. (3) Deferred gift card and gift certificate revenue is included in deferred gift card revenue and other on the consolidated balance sheets. The Company determined that the services it provides under its licensing agreements are primarily the rights to access and derive benefit from our symbolic intellectual property. As a result, the initial license fees and upfront fees are recognized on a straight-line basis over the term of the license agreement as a component of management, license and incentive fee revenue on the consolidated statements of operations and comprehensive income (loss). Sales-based royalties are recognized as licensee restaurant sales occur. Significant changes in deferred license revenue for the nine months ended September 30, 2019 were as follows (in thousands): Deferred license revenue, as of December 31, 2018 $ 1,179 Additions to deferred license revenue 111 Revenue recognized during the period (148) Deferred license revenue, as of September 30, 2019 $ 1,142 As of September 30, 2019, the estimated deferred license revenue to be recognized in the future related to performance obligations that are unsatisfied as of September 30, 2019 was as follows (in thousands): 2019, nine months remaining $ 48 2020 191 2021 191 2022 166 2023 135 Thereafter 411 Total future estimated deferred license revenue $ 1,142 Proceeds from the sale of gift cards and gift certificates are recorded as deferred revenue and recognized as revenue when redeemed by the holder. There are no expiration dates on the Company’s gift card and gift certificates and the Company does not charge any service fees that would result in a decrease to a customer’s available balance. Although the Company will continue to honor all gift card and gift certificates presented for payment, it may determine the likelihood of redemption to be remote for certain gift cards and gift certificates due to, among other things, long periods of inactivity. In these circumstances, to the extent the Company determines there is no requirement for remitting balances to government agencies under unclaimed property laws, outstanding gift card and gift certificate balances may then be recognized as breakage in the consolidated statements of operations and comprehensive income (loss) as a component of owned food, beverage and other net revenues. Significant changes in deferred gift card and gift certificate revenue for the nine months ended September 30, 2019 were as follows (in thousands): Deferred gift card and gift certificate revenue, as of December 31, 2018 $ 491 Additions to deferred gift card and gift certificates revenue 353 Revenue recognized during the period related to redemptions (707) Deferred gift card and gift certificate revenue, as of September 30, 2019 $ 137 The Company recognized revenue of $0.2 million and $0.1 million related to our contract liabilities, which include deferred license revenue and deferred gift card and gift certificate revenue, in the three months ended September 30, 2019 and 2018, respectively, and $0.9 million and $0.6 million in the nine months ended September 30, 2019 and 2018, respectively. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Leases | Note 12 – Leases The Company adopted ASC Topic 842 as of January 1, 2019 using the optional transition method and has applied its transition provisions at the beginning of the period of adoption. As a result, the Company did not restate comparative periods. Under this transition provision, the Company has applied the legacy guidance under Accounting Standard Codification Topic 840, Leases, including its disclosure requirements, in the comparative periods presented. Under ASC Topic 842, a lease is a contract, or part of a contract, that conveys the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration. The Company’s contracts determined to be or contain a lease include explicitly or implicitly identified assets where the Company has the right to substantially all of the economic benefits of the assets and has the ability to direct how and for what purpose the assets are used during the lease term. Leases are classified as either operating or financing. For operating leases, the Company has recognized a lease liability equal to the present value of the remaining lease payments, and a right of use asset equal to the lease liability, subject to certain adjustments, such as prepaid rents, initial direct costs and lease incentives received from the lessor. The Company used its incremental borrowing rate to determine the present value of the lease payments. The Company’s incremental borrowing rate is the rate of interest that it would have to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. ASC Topic 842 includes practical expedient and policy election choices. The Company elected the practical expedient transition package available in ASC Topic 842 and, as a result, did not reassess the lease classification of existing contracts or leases or the initial direct costs associated with existing leases. The Company has made an accounting policy election not to recognize right of use assets and lease liabilities for leases with a lease term of 12 months or less, including renewal options that are reasonably certain to be exercised, that also do not include an option to purchase the underlying asset that is reasonably certain of exercise. Instead, lease payments for these leases are recognized as lease cost on a straight-line basis over the lease term. Additionally, the Company has elected not to separate the accounting for lease components and non-lease components, for all leased assets. The Company did not elect the hindsight practical expedient, and therefore the Company did not reassess its historical conclusions with regards to whether renewal option periods should be included in the terms of its leases. Given the importance of each of its restaurant locations to its operations, the Company historically concluded that it was reasonably assured of exercising all renewal periods included in its leases as failure to exercise such options would result in an economic penalty. The Company also did not elect the portfolio approach practical expedient, which permits applying the standard to a portfolio of leases with similar characteristics. Upon adoption on January 1, 2019, the Company recognized right-of-use assets and lease liabilities for operating leases of $41.8 million and $58.9 million, respectively. The difference between the right-of-use asset and lease liability represents the net book value of deferred rent and tenant improvement allowances recognized by the Company as of December 31, 2018, which was adjusted against the right-of-use asset upon adoption of ASC Topic 842. There was no impact to the opening balance of retained earnings upon adoption. The changes due to the adoption of ASC Topic 842 were as follows (in thousands): ASC 842 December 31, 2018 Adjustments January 1, 2019 Assets Operating lease right-of-use assets $ — $ 41,868 $ 41,868 Liabilities Current portion of operating lease liabilities $ — $ 3,212 $ 3,212 Operating lease liability, net of current portion — 55,679 55,679 Deferred gift card revenue and other 947 (249) 698 Deferred rent and tenant improvement allowances $ 16,774 $ (16,774) $ — There was no impact to the Company’s consolidated statements of operations and comprehensive income (loss) for the three and nine months ended September 30, 2019 compared to the three and nine months ended September 30, 2018. The Company enters into contracts to lease office space, restaurant space and equipment with terms that expire at various dates through 2039. Under ASC Topic 842, the lease term at the lease commencement date is determined based on the non-cancellable period for which the Company has the right to use the underlying asset, together with any periods covered by an option to extend the lease if the Company is reasonably certain to exercise that option, periods covered by an option to terminate the lease if the Company is reasonably certain not to exercise that option, and periods covered by an option to extend (or not to terminate) the lease in which the exercise of the option is controlled by the lessor. The Company considered a number of factors when evaluating whether the options in its lease contracts were reasonably certain of exercise, such as length of time before option exercise, expected value of the leased asset at the end of the initial lease term, importance of the lease to overall operations, costs to negotiate a new lease, and any contractual or economic penalties. Certain of the Company’s leases also provide for percentage rent, which are variable lease costs determined as a percentage of gross sales in excess of specified, minimum sales targets, as well as other variable lease costs to reimburse the lessor for real estate tax and insurance expenses, and certain non-lease components that transfer a distinct service to the Company, such as common area maintenance services. These percentage rents and other variable lease costs are not included in the calculation of lease payments when classifying a lease and in the measurement of the lease liability as they do not meet the definition of in-substance, fixed-lease payments under ASC Topic 842. The Company subleases portions of its office and restaurant space where it does not use the entire space for its operations. For the three and nine months ended September 30, 2019, sublease income was $0.1 million and $0.6 million, respectively, of which $0.1 million and $0.4 million, respectively, was from related party, Bagatelle NY. Refer to Note 8 for details on transactions with this related party. ASC Topic 842 includes a number of reassessment and re-measurement requirements for lessees based on certain triggering events or conditions, including whether a contract is or contains a lease, assessment of lease term and purchase options, measurement of lease payments, assessment of lease classification and assessment of the discount rate. The Company reviewed the reassessment and re-measurement requirements and concluded that a lease for office space required reassessment as the Company had determined not to elect to exercise an option that it had previously determined it was reasonably certain to exercise. As a result, the Company remeasured the lease liability to reflect the change in lease payments, which resulted in a reduction in the operating lease liability and a corresponding adjustment to the operating lease right-of-use asset of $1.2 million in the nine months ended September 30, 2019. In addition, there were no impairment indicators identified during the nine months ended September 30, 2019 that required an impairment test for the Company’s right-of-use assets or other long-lived assets in accordance with Accounting Standard Codification Topic 360, Property, Plant, and Equipment. The components of lease expense for the period were as follows (in thousands): September 30, 2019 Lease cost Operating lease cost $ 5,040 Variable lease cost 1,811 Short-term lease cost 273 Sublease income (582) Total lease cost $ 6,542 Weighted average remaining lease term – operating leases 14 years Weighted average discount rate – operating leases 8.22 % Supplemental cash flow information related to leases for the period was as follows (in thousands): September 30, 2019 Cash paid for amounts included in the measurement of operating lease liabilities $ 5,212 Right-of-use assets obtained in exchange for operating lease obligations $ 1,076 As of September 30, 2019, maturities of the Company’s operating lease liabilities are as follows (in thousands): 2019, three months remaining $ 1,844 2020 7,088 2021 6,839 2022 6,971 2023 7,117 Thereafter 69,929 Total lease payments 99,788 Less: imputed interest (42,525) Present value of operating lease liabilities $ 57,263 |
Earnings per share
Earnings per share | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Earnings per share | Note 13 – Earnings per share Basic earnings per share is computed using the weighted average number of common shares outstanding during the period and income available to common stockholders. Diluted earnings per share is computed using the weighted average number of common shares outstanding during the period plus the dilutive effect of all potential shares of common stock including common stock issuable pursuant to stock options, warrants, and restricted stock units. For the three and nine months ended September 30, 2019 and 2018, the earnings per share was calculated as follows (in thousands, except earnings per share and related share data): Three months ended September 30, Nine months ended September 30, 2019 2018 2019 2018 Net income (loss) attributable to The ONE Group Hospitality, Inc. $ 460 $ (305) $ 992 $ 106 Basic weighted average shares outstanding 28,537,477 27,751,632 28,429,074 27,437,269 Dilutive effect of stock options, warrants and restricted share units 1,363,667 — 1,213,852 62,376 Diluted weighted average shares outstanding 29,901,144 27,751,632 29,642,926 27,499,645 Net income (loss) available to common stockholders per share - Basic $ 0.02 (0.01) $ 0.03 $ 0.00 Net income (loss) available to common stockholders per share - Diluted $ 0.02 $ (0.01) $ 0.03 $ 0.00 For the three and nine months ended September 30, 2019, 1.0 million stock options, warrants and restricted share units were determined to be anti-dilutive and were therefore excluded from the calculation of diluted earnings per share. For the nine months ended September 30, 2018, 1.9 million stock options, warrants and restricted share units were determined to be anti-dilutive and were therefore excluded from the calculation of diluted earnings per share. For the three months ended September 30, 2019, all equivalent shares underlying options, warrants and restricted share units were anti-dilutive as the Company was in a net loss position. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2019 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Note 14 – Stockholders’ Equity Significant changes in stockholders’ equity for the three and nine months ended September 30, 2019 and 2018 are as follows (in thousands): Accumulated Additional other Common paid-in Accumulated comprehensive Noncontrolling Stock capital deficit loss interests Total Balance at December 31, 2018 $ 3 $ 43,543 $ (28,722) $ (2,310) $ (452) $ 12,062 Stock-based compensation — 181 — — — 181 Loss on foreign currency translation, net — — — (160) — (160) Net income (loss) — — 854 — (85) 769 Balance at March 31, 2019 3 43,724 (27,868) (2,470) (537) 12,852 Stock-based compensation — 456 — — — 456 Loss on foreign currency translation, net — — — (120) — (120) Net (loss) income — — (322) — 159 (163) Balance at June 30, 2019 3 44,180 (28,190) (2,590) (378) 13,025 Stock-based compensation — 338 — — — 338 Exercise of stock options — 66 — — — 66 Loss on foreign currency translation, net — — — (49) — (49) Net income — — 460 — 9 469 Balance at September 30, 2019 $ 3 $ 44,584 $ (27,730) $ (2,639) $ (369) $ 13,849 Accumulated Additional other Common paid-in Accumulated comprehensive Noncontrolling Stock capital deficit loss interests Total Balance at December 31, 2017 $ 3 $ 41,007 $ (31,979) $ (1,556) $ (922) $ 6,553 Adoption of ASC 606 “Revenue from contracts with customers” — — (54) — — (54) Stock-based compensation — 324 — — — 324 Loss on foreign currency translation, net — — — (75) — (75) Net income (loss) — — 231 — (113) 118 Balance at March 31, 2018 3 41,331 (31,802) (1,631) (1,035) 6,866 Stock-based compensation — 344 — — — 344 Gain on foreign currency translation, net — — — 141 — 141 Net income — — 181 — 133 314 Balance at June 30, 2018 3 41,675 (31,621) (1,490) (902) 7,665 Stock-based compensation — 337 — — — 337 Exercise of warrants — 1,223 — — — 1,223 Loss on foreign currency translation, net — — — (68) — (68) Reclassification of realized gains — — — (102) — (102) Net (loss) income — — (306) — 96 (210) Balance at September 30, 2018 $ 3 $ 43,235 $ (31,927) $ (1,660) $ (806) $ 8,845 |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Note 15 – Stock-Based Compensation Effective June 4, 2019, the Company’s stockholders approved amendments to the 2013 Employee, Director and Consultant Equity Incentive Plan (the “2019 Equity Plan”). Among other things, the amendments increased the number of shares of common stock authorized for issuance under the 2019 Equity Plan by 2,300,000 shares to a new maximum aggregate limit of 7,073,922 shares. As of September 30, 2019, the Company had 2,589,077, remaining shares available for issuance under the 2019 Equity Plan. Stock-based compensation cost was $0.3 million for each of the three months ended September 30, 2019 and 2018, respectively, and $1.0 million for each of the nine months ended September 30, 2019 and 2018, respectively. Stock-based compensation is included in general and administrative expenses in the consolidated statements of operations and comprehensive income (loss). Stock Option Activity Changes in outstanding stock options during the nine months ended September 30, 2019 were as follows: Weighted Weighted average Intrinsic average exercise remaining value Shares price contractual life (thousands) Outstanding at December 31, 2018 2,001,008 $ 3.29 Granted 68,000 2.99 Exercised (30,000) 2.23 Cancelled, expired or forfeited (193,500) 2.74 Outstanding at September 30, 2019 1,845,508 $ 3.35 6.13 years $ 810 Exercisable at September 30, 2019 1,216,508 $ 4.04 5.19 years $ 302 The fair value of options granted in the nine months ended September 30, 2019 was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions: Expected life, in years 8.5 years Risk-free interest rate 2.62 % Volatility 42.0 % Dividend yield — % A summary of the status of the Company’s non-vested stock options as of December 31, 2018 and September 30, 2019 and changes during the nine months then ended, is presented below: Weighted average Shares grant date fair value Non-vested stock options at December 31, 2018 926,500 $ 0.91 Granted 68,000 2.99 Vested (215,500) 1.29 Cancelled, expired or forfeited (150,000) 0.95 Non-vested stock options at September 30, 2019 629,000 $ 0.84 As of September 30, 2019, there are 579,402 milestone-based options outstanding, and there is approximately $0.7 million of unrecognized compensation cost related to these milestone-based options. These options vest based on the achievement of Company and individual objectives as set by the Board. As of September 30, 2019, there is approximately $0.4 million of total unrecognized compensation cost related to non-vested awards, which will be recognized over a weighted-average period of 3.0 years. Restricted Stock Unit Activity The Company issues restricted stock units (“RSUs”) under the 2019 Equity Plan. The fair value of these RSUs is determined based upon the closing fair market value of the Company’s common stock on the grant date. A summary of the status of RSUs and changes during the nine months ended September 30, 2019 is presented below: Weighted average Shares grant date fair value Non-vested RSUs at December 31, 2018 764,201 $ 2.54 Granted 466,905 3.05 Vested (187,001) 2.54 Cancelled, expired or forfeited (81,000) 2.48 Non-vested RSUs at September 30, 2019 963,105 $ 2.63 As of September 30, 2019, 150,000 RSUs subject to performance-based vesting were still outstanding. As of September 30, 2019, the Company had approximately $1.8 million of total unrecognized compensation costs related to RSUs, which will be recognized over a weighted average period of 2.8 years. |
Segment Reporting
Segment Reporting | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
Segment Reporting | Note 16 – Segment Reporting The Company operates in three segments: “Owned restaurants,” “Owned food, beverage and other,” and “Managed and licensed operations.” The Owned restaurants segment consists of leased restaurant locations and competes in the full-service dining industry. The Owned food, beverage and other segment consists of hybrid operations, such as where the Company has a leased restaurant location and also has a food and beverage agreement at the same location, typically a hotel, and offsite banquet offerings. The Managed and licensed operations segment includes all operations for which a management, incentive or license fee is received. Management agreements generate management fees on net revenue and incentive fees on operating profit as defined in the applicable management agreement. License agreements generate revenue primarily through royalties earned on net revenue at each location. Revenues associated with developmental support for licensed locations are also included within this segment. The Company’s Chief Executive Officer (“CEO”), who has been deemed the Company’s Chief Operating Decision Maker, manages the business and allocates resources via a combination of restaurant sales reports and segment profit information (which is defined as revenues less operating expenses) related to the Company’s three segments, or sources of revenues, which are presented in their entirety within the consolidated statements of operations and comprehensive income (loss). The Company’s operating results by segment were as follows (in thousands): For the three months ended September 30, 2019 For the three months ended September 30, 2018 Owned food, Managed and Owned food, Managed and Owned beverage and licensed Owned beverage and licensed restaurants other operations Total restaurants other operations Total Revenues: Owned net revenues $ 17,120 $ 2,065 $ — $ 19,185 $ 15,312 $ 1,960 $ — $ 17,272 Management, license and incentive fee revenue — — 2,921 2,921 — — 2,688 2,688 Total revenues 17,120 2,065 2,921 22,106 15,312 1,960 2,688 19,960 Cost and expenses: Owned operating expenses: Cost of sales 4,472 — — 4,472 4,050 — — 4,050 Other operating expenses 10,783 — — 10,783 9,779 — — 9,779 Owned food, beverage and other expenses — 1,971 — 1,971 — 2,068 — 2,068 Total owned operating expenses 15,255 1,971 — 17,226 13,829 2,068 — 15,897 Segment income (loss) $ 1,865 $ 94 $ 2,921 $ 4,880 $ 1,483 $ (108) $ 2,688 $ 4,063 General and administrative 2,352 2,266 Depreciation and amortization 1,103 896 Interest expense, net of interest income 230 294 Transaction costs 358 — Other 292 565 Income before provision for income taxes $ 545 $ 42 For the nine months ended September 30, 2019 For the nine months ended September 30, 2018 Owned food, Managed and Owned food, Managed and Owned beverage and licensed Owned beverage and licensed restaurants other operations Total restaurants other operations Total Revenues: Owned net revenues $ 53,749 $ 6,472 $ — $ 60,221 $ 45,908 $ 6,048 $ — $ 51,956 Management, license and incentive fee revenue — — 8,260 8,260 — — 7,832 7,832 Total revenues 53,749 6,472 8,260 68,481 45,908 6,048 7,832 59,788 Cost and expenses: Owned operating expenses: Cost of sales 14,109 — — 14,109 12,121 — — 12,121 Other operating expenses 33,554 — — 33,554 28,556 — — 28,556 Owned food, beverage and other expenses — 6,455 — 6,455 — 5,782 — 5,782 Total owned operating expenses 47,663 6,455 — 54,118 40,677 5,782 — 46,459 Segment income (loss) $ 6,086 $ 17 $ 8,260 $ 14,363 $ 5,231 $ 266 $ 7,832 $ 13,329 General and administrative 7,706 7,937 Depreciation and amortization 3,049 2,575 Interest expense, net of interest income 717 902 Transaction costs 510 — Loss on early debt extinguishment 437 — Equity in income of investee companies — (111) Other 712 1,359 Income before provision for income taxes $ 1,232 $ 667 The Company’s total assets by segment for the periods indicated were as follows (in thousands): September 30, December 31, 2019 2018 Total assets: Owned restaurants $ 73,753 $ 42,971 Owned food, beverage and other operations (1) 16,204 7,274 Managed and licensed operations 5,463 5,734 Total $ 95,420 $ 55,979 (1) Includes corporate assets and unallocated corporate assets The Company’s total assets increased $39.8 million as of September 30, 2019 compared to December 31, 2018 as a result of adopting ASC Topic 842 during the first quarter of 2019. Refer to Note 12 for additional information regarding the adoption of ASC Topic 842. The Company’s capital asset additions by segment for the periods indicated were as follows (in thousands): For the nine months ended September 30, 2019 2018 Capital assets additions: Owned restaurants $ 2,861 $ 2,792 Owned food, beverage and other operations (1) 648 446 Managed and licensed operations — — Total $ 3,509 $ 3,238 (1) Includes corporate capital asset additions and unallocated corporate additions |
Geographic Information
Geographic Information | 9 Months Ended |
Sep. 30, 2019 | |
Geographic Information [Abstract] | |
Geographic Information | Note 17 – Geographic Information The following tables contain certain financial information by geographic location for the three and nine months ended September 30, 2019 and 2018 (in thousands): Revenues For the three months ended September 30, For the nine months ended September 30, 2019 2018 2019 2018 Domestic: Owned restaurants $ 17,120 $ 15,312 $ 53,749 $ 45,908 Owned food, beverage and other operations 2,065 1,960 6,472 6,048 Managed and licensed operations 1,545 1,469 4,827 4,797 Total domestic revenues $ 20,730 $ 18,741 $ 65,048 $ 56,753 International: Owned restaurants — — — — Owned food, beverage and other operations — — — — Managed and licensed operations 1,376 1,219 3,433 3,035 Total international revenues $ 1,376 $ 1,219 $ 3,433 $ 3,035 Total revenues $ 22,106 $ 19,960 $ 68,481 $ 59,788 Long-lived assets September 30, December 31, 2019 2018 Domestic: Owned restaurants $ 70,406 $ 38,958 Owned food, beverage and other operations 13,054 5,375 Managed and licensed operations 42 67 Total domestic long-lived assets $ 83,502 $ 44,400 International: Owned restaurants — — Owned food, beverage and other operations — — Managed and licensed operations 49 38 Total international long-lived assets $ 49 $ 38 Total long-lived assets $ 83,551 $ 44,438 |
Litigation
Litigation | 9 Months Ended |
Sep. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Litigation | Note 18 – Litigation The Company is party to claims in lawsuits incidental to its business, including lease disputes and employee-related matters. In the opinion of management, the ultimate outcome of such matters, individually or in the aggregate, will not have a material adverse effect on the Company’s consolidated financial position or results of operations. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2019 | |
Subsequent Events | |
Subsequent Events | Note 19 – Subsequent Events On October 4, 2019, the Company acquired substantially all of the assets of Kona Grill, Inc. and its affiliates (“Kona Grill”), comprising 24 domestic restaurants and one international franchise agreement. The Company purchased the assets for $25.0 million in cash and the assumption of approximately $11.0 million in working capital liabilities. The purchase was financed with proceeds from a credit and guaranty agreement the Company entered into with Goldman Sachs Bank USA on October 4, 2019 (“Goldman Sachs Credit Agreement”), which replaced the Company’s Bank of America Credit Agreement . The Goldman Sachs Credit Agreement provides for a secured revolving credit facility of $12.0 million and a $48.0 million term loan. The term loan is payable in quarterly installments, with the final payment due in October 2024. The revolving credit facility also matures in October 2024. The Goldman Sachs Credit Agreement contains several financial covenants, including the following: · A minimum consolidated fixed charge coverage ratio of (i) 1.35 to 1.00 as of the end of any fiscal quarter ending on or prior to June 30, 2021 and (ii) 1.50 to 1.00 as of any fiscal quarter thereafter; · A maximum consolidated leverage ratio of (i) 2.75 to 1.00 as of the end of any fiscal quarter ending on or prior to March 31, 2020, (ii) 2.50 to 1.00 as of the fiscal quarter ending June 30, 2020, (iii) 2.25 to 1.00 as of the fiscal quarters ending September 30, 2020 and December 31, 2020, (iv) 2.00 to 1.00 as of the fiscal quarter ending March 31, 2021, (v) 1.75 to 1.00 as of the fiscal quarter ending June 30, 2021, (vi) 1.70 to 1.00 as of the fiscal quarter ending September 30, 2021, (vii) 1.65 to 1.00 as of the fiscal quarter ending December 21, 2021 and (viii) 1.50 to 1.00 as of the end of any fiscal quarter thereafter; · Maximum consolidated capital expenditures not to exceed (i) $10,000,000 in 2020 and (ii) $8,000,000 in 2021 and every fiscal year thereafter; and, · Minimum consolidated liquidity not to be less than $1,500,000 at any time. The Goldman Sachs Credit Agreement has several borrowing and interest rate options, including the following: (a) a LIBOR rate (or a comparable successor rate) subject to a 1.75% floor or (b) a base rate equal to the greatest of (i) the prime rate, (ii) the federal funds rate plus 0.50%, (iii) the LIBOR rate for a one-month period plus 1.00% or (iv) 4.75%. Loans under the Goldman Sachs Credit Agreement bear interest at a rate per annum using the applicable indices plus a varying interest rate margin of between 5.75% and 6.75% (for LIBOR rate loans) and 4.75% and 5.75% (for base rate loans). The Goldman Sachs Credit Agreement contains customary representations, warranties and conditions to borrowing including customary affirmative and negative covenants, which include covenants that limit or restrict the Company’s ability to incur indebtedness and other obligations, grant liens to secure obligations, make investments, merge or consolidate, and dispose of assets outside the ordinary course of business, in each case subject to customary exceptions for credit facilities of this size and type. The Company and certain operating subsidiaries of the Company guarantee the obligations under the Goldman Sachs Credit Agreement, which also are secured by liens on substantially all of the assets of the Company and its subsidiaries. |
Summary of Business and Signi_2
Summary of Business and Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated balance sheet as of December 31, 2018, which has been derived from audited financial statements, and the accompanying unaudited interim consolidated financial statements of the Company have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and in accordance with accounting principles generally accepted in the United States (“GAAP”). Certain information and footnote disclosures normally included in annual audited financial statements have been omitted pursuant to SEC rules and regulations. These unaudited interim consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10‑K for the year ended December 31, 2018. In the Company’s opinion, the accompanying unaudited interim financial statements reflect all adjustments (consisting only of normal recurring accruals and adjustments) necessary for a fair presentation of the results for the interim periods presented. The results of operations for any interim period are not necessarily indicative of the results expected for the full year. Additionally, the Company believes that the disclosures are sufficient for interim financial reporting purposes. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In July 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Updated (“ASU”) No. 2019‑07, “Codification Updates to SEC Sections – Amendments to SEC Paragraphs Pursuant to SEC Final Rule Releases No. 33-10532, Disclosure Update and Simplification, and Nos. 33-10231 and 33-10442, Investment Company Reporting Modernization and Miscellaneous Updates (SEC Update)” (“ASU 2019‑07”). ASU 2019‑07 updates the accounting standards codification to reflect the amendments of various SEC disclosure requirements that the agency determined were redundant, duplicative, overlapping, outdated or superseded and aligns the guidance with the requirements of certain SEC final rules. ASU 2019‑07 is effective immediately. The adoption of ASU 2019-07 did not have a material impact on our financial position, results of operations or cash flows . In March 2019, the FASB issued ASU No. 2019‑01, “Leases (Topic 842): Codification Improvements” (“ASU 2019‑01”). ASU 2019‑01 provided clarification related to adopting Accounting Standard Codification Topic 842, Leases (“ASC Topic 842”). ASU 2019‑01 addresses fair value determinations of underlying assets by lessors, cash flow statement presentation for financing leases, and transition disclosures. The Company adopted ASC Topic 842 as of January 1, 2019 and considered the clarification guidance in ASU 2019‑01 as part of its adoption. Refer to Note 12 for additional details regarding the adoption of ASC Topic 842. In October 2018, the FASB issued ASU No. 2018‑17, “Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities” (“ASU 2018‑17”). ASU 2018‑17 states that indirect interests held through related parties in common control arrangements should be considered on a proportional basis to determine whether fees paid to decision makers and service providers are variable interests. This is consistent with how indirect interests held through related parties under common control are considered for determining whether a reporting entity must consolidate a variable interest entity. ASU 2018‑17 is effective for annual and interim periods beginning after December 15, 2019, with early adoption permitted. Entities are required to adopt the new guidance retrospectively with a cumulative adjustment to retained earnings at the beginning of the earliest period presented. The Company is evaluating the effects of this pronouncement on its consolidated financial statements. In August 2018, the FASB issued ASU No. 2018‑13, “Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement” (“ASU 2018‑13”). ASU 2018‑13 eliminates, modifies and adds disclosure requirements for fair value measurements. The amendments in ASU 2018‑13 are effective for annual and interim periods beginning after December 15, 2019, with early adoption permitted. The Company is evaluating the effects of ASU 2018‑13 on its consolidated financial statements but does not expect the adoption of ASU 2018‑13 to be material. In August 2018, the FASB issued ASU No. 2018‑15, “Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350‑40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract” (“ASU 2018‑15”). ASU 2018‑15 aligns the requirements for capitalizing implementation costs in cloud computing arrangements with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. ASU 2018‑15 is effective for annual and interim periods beginning after December 15, 2019, with early adoption permitted. Entities can choose to adopt the new guidance prospectively or retrospectively. The Company is evaluating the effects of this pronouncement on its consolidated financial statements. |
Inventory (Tables)
Inventory (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of inventory | Inventory consists of the following (in thousands): September 30, December 31, 2019 2018 Food $ 317 $ 300 Beverages 1,285 1,104 Total $ 1,602 $ 1,404 |
Other Current Assets (Tables)
Other Current Assets (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of other current assets | Other current assets consist of the following (in thousands): September 30, December 31, 2019 2018 Prepaid taxes $ 587 $ 503 Landlord receivable 195 195 Prepaid expenses 926 680 Other 94 93 Total $ 1,802 $ 1,471 |
Property and Equipment, net (Ta
Property and Equipment, net (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment, net | Property and equipment, net consist of the following (in thousands): September 30, December 31, 2019 2018 Furniture, fixtures and equipment $ 12,106 $ 10,425 Leasehold improvements 45,820 43,890 Less: accumulated depreciation and amortization (19,861) (16,969) Subtotal 38,065 37,346 Construction in progress — 336 Restaurant smallwares 1,931 1,665 Total $ 39,996 $ 39,347 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Accrued [Abstract] | |
Schedule of accrued expenses | Accrued expenses consist of the following (in thousands): September 30, December 31, 2019 2018 Variable rent, including disputed rent amounts $ 1,305 $ 1,766 Legal, professional and other services 658 645 Payroll and related 802 1,794 VAT and sales taxes 259 1,028 Insurance 212 212 Income taxes and related 340 685 Due to hotels — 203 Other 726 1,760 Total $ 4,302 $ 8,093 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt | Long-term debt consists of the following (in thousands): September 30, December 31, 2019 2018 Term loan agreements $ 9,813 $ 3,828 Revolving credit facility 3,750 — Equipment financing agreements 475 752 Promissory notes — 6,250 Total long-term debt 14,038 10,830 Less: current portion of long-term debt (1,076) (3,201) Less: debt issuance costs (707) (32) Less: discounts on warrants, net — (479) Total long-term debt, net of current portion $ 12,255 $ 7,118 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of fair value of financial instruments | The estimated fair values of long-term debt, for which carrying values do not approximate fair value, are as follows (in thousands): September 30, December 31, 2019 2018 Carrying amount of long-term debt, including current portion (1) $ 10,288 $ 10,830 Fair value of long-term debt, including current portion $ 8,618 $ 7,648 (1) Excludes the discounts on warrants, net and debt issuance costs |
Nonconsolidated Variable Inte_2
Nonconsolidated Variable Interest Entities (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of equity investments | The carrying values of these investments were as follows (in thousands): September 30, December 31, 2019 2018 Bagatelle Investors $ 56 $ 56 Bagatelle NY 2,628 2,628 Total $ 2,684 $ 2,684 |
Revenue from contracts with c_2
Revenue from contracts with customers (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of receivables and contract liabilities | The following table provides information about contract receivables and liabilities, which include deferred license revenue and deferred gift card and gift certificate revenue, from contracts with customers (in thousands): September 30, December 31, 2019 2018 Receivables (1) $ 125 $ 174 Deferred license revenue (2) 1,142 1,179 Deferred gift card and gift certificate revenue (3) $ 137 $ 491 (1) Receivables are included in accounts receivable on the consolidated balance sheets. (2) Includes the current and long-term portion of deferred license revenue. (3) Deferred gift card and gift certificate revenue is included in deferred gift card revenue and other on the consolidated balance sheets. |
Schedule of changes in deferred license revenue | Significant changes in deferred license revenue for the nine months ended September 30, 2019 were as follows (in thousands): Deferred license revenue, as of December 31, 2018 $ 1,179 Additions to deferred license revenue 111 Revenue recognized during the period (148) Deferred license revenue, as of September 30, 2019 $ 1,142 |
Schedule of estimated deferred license revenue to be recognized in the future related to performance obligations | As of September 30, 2019, the estimated deferred license revenue to be recognized in the future related to performance obligations that are unsatisfied as of September 30, 2019 was as follows (in thousands): 2019, nine months remaining $ 48 2020 191 2021 191 2022 166 2023 135 Thereafter 411 Total future estimated deferred license revenue $ 1,142 |
Schedule of changes in deferred gift certificate revenue | Significant changes in deferred gift card and gift certificate revenue for the nine months ended September 30, 2019 were as follows (in thousands): Deferred gift card and gift certificate revenue, as of December 31, 2018 $ 491 Additions to deferred gift card and gift certificates revenue 353 Revenue recognized during the period related to redemptions (707) Deferred gift card and gift certificate revenue, as of September 30, 2019 $ 137 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Schedule of changes due to the adoption of ASC Topic 842 | The changes due to the adoption of ASC Topic 842 were as follows (in thousands): ASC 842 December 31, 2018 Adjustments January 1, 2019 Assets Operating lease right-of-use assets $ — $ 41,868 $ 41,868 Liabilities Current portion of operating lease liabilities $ — $ 3,212 $ 3,212 Operating lease liability, net of current portion — 55,679 55,679 Deferred gift card revenue and other 947 (249) 698 Deferred rent and tenant improvement allowances $ 16,774 $ (16,774) $ — |
Schedule of components of lease expense | The components of lease expense for the period were as follows (in thousands): September 30, 2019 Lease cost Operating lease cost $ 5,040 Variable lease cost 1,811 Short-term lease cost 273 Sublease income (582) Total lease cost $ 6,542 Weighted average remaining lease term – operating leases 14 years Weighted average discount rate – operating leases 8.22 % |
Schedule of supplemental cash flow information related to leases | Supplemental cash flow information related to leases for the period was as follows (in thousands): September 30, 2019 Cash paid for amounts included in the measurement of operating lease liabilities $ 5,212 Right-of-use assets obtained in exchange for operating lease obligations $ 1,076 |
Schedule of maturities of operating lease liabilities | As of September 30, 2019, maturities of the Company’s operating lease liabilities are as follows (in thousands): 2019, three months remaining $ 1,844 2020 7,088 2021 6,839 2022 6,971 2023 7,117 Thereafter 69,929 Total lease payments 99,788 Less: imputed interest (42,525) Present value of operating lease liabilities $ 57,263 |
Earnings per share (Tables)
Earnings per share (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of earnings per share, basic and diluted | For the three and nine months ended September 30, 2019 and 2018, the earnings per share was calculated as follows (in thousands, except earnings per share and related share data): Three months ended September 30, Nine months ended September 30, 2019 2018 2019 2018 Net income (loss) attributable to The ONE Group Hospitality, Inc. $ 460 $ (305) $ 992 $ 106 Basic weighted average shares outstanding 28,537,477 27,751,632 28,429,074 27,437,269 Dilutive effect of stock options, warrants and restricted share units 1,363,667 — 1,213,852 62,376 Diluted weighted average shares outstanding 29,901,144 27,751,632 29,642,926 27,499,645 Net income (loss) available to common stockholders per share - Basic $ 0.02 (0.01) $ 0.03 $ 0.00 Net income (loss) available to common stockholders per share - Diluted $ 0.02 $ (0.01) $ 0.03 $ 0.00 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Stockholders' Equity Note [Abstract] | |
Schedule of changes in stockholders' equity | Significant changes in stockholders’ equity for the three and nine months ended September 30, 2019 and 2018 are as follows (in thousands): Accumulated Additional other Common paid-in Accumulated comprehensive Noncontrolling Stock capital deficit loss interests Total Balance at December 31, 2018 $ 3 $ 43,543 $ (28,722) $ (2,310) $ (452) $ 12,062 Stock-based compensation — 181 — — — 181 Loss on foreign currency translation, net — — — (160) — (160) Net income (loss) — — 854 — (85) 769 Balance at March 31, 2019 3 43,724 (27,868) (2,470) (537) 12,852 Stock-based compensation — 456 — — — 456 Loss on foreign currency translation, net — — — (120) — (120) Net (loss) income — — (322) — 159 (163) Balance at June 30, 2019 3 44,180 (28,190) (2,590) (378) 13,025 Stock-based compensation — 338 — — — 338 Exercise of stock options — 66 — — — 66 Loss on foreign currency translation, net — — — (49) — (49) Net income — — 460 — 9 469 Balance at September 30, 2019 $ 3 $ 44,584 $ (27,730) $ (2,639) $ (369) $ 13,849 Accumulated Additional other Common paid-in Accumulated comprehensive Noncontrolling Stock capital deficit loss interests Total Balance at December 31, 2017 $ 3 $ 41,007 $ (31,979) $ (1,556) $ (922) $ 6,553 Adoption of ASC 606 “Revenue from contracts with customers” — — (54) — — (54) Stock-based compensation — 324 — — — 324 Loss on foreign currency translation, net — — — (75) — (75) Net income (loss) — — 231 — (113) 118 Balance at March 31, 2018 3 41,331 (31,802) (1,631) (1,035) 6,866 Stock-based compensation — 344 — — — 344 Gain on foreign currency translation, net — — — 141 — 141 Net income — — 181 — 133 314 Balance at June 30, 2018 3 41,675 (31,621) (1,490) (902) 7,665 Stock-based compensation — 337 — — — 337 Exercise of warrants — 1,223 — — — 1,223 Loss on foreign currency translation, net — — — (68) — (68) Reclassification of realized gains — — — (102) — (102) Net (loss) income — — (306) — 96 (210) Balance at September 30, 2018 $ 3 $ 43,235 $ (31,927) $ (1,660) $ (806) $ 8,845 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of stock option activity | Weighted Weighted average Intrinsic average exercise remaining value Shares price contractual life (thousands) Outstanding at December 31, 2018 2,001,008 $ 3.29 Granted 68,000 2.99 Exercised (30,000) 2.23 Cancelled, expired or forfeited (193,500) 2.74 Outstanding at September 30, 2019 1,845,508 $ 3.35 6.13 years $ 810 Exercisable at September 30, 2019 1,216,508 $ 4.04 5.19 years $ 302 |
Schedule of fair value of options granted | Expected life, in years 8.5 years Risk-free interest rate 2.62 % Volatility 42.0 % Dividend yield — % |
Schedule of non-vested stock options | Weighted average Shares grant date fair value Non-vested stock options at December 31, 2018 926,500 $ 0.91 Granted 68,000 2.99 Vested (215,500) 1.29 Cancelled, expired or forfeited (150,000) 0.95 Non-vested stock options at September 30, 2019 629,000 $ 0.84 |
Schedule of restricted stock awards and changes | Weighted average Shares grant date fair value Non-vested RSUs at December 31, 2018 764,201 $ 2.54 Granted 466,905 3.05 Vested (187,001) 2.54 Cancelled, expired or forfeited (81,000) 2.48 Non-vested RSUs at September 30, 2019 963,105 $ 2.63 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
Schedule of segment information | The Company’s operating results by segment were as follows (in thousands): For the three months ended September 30, 2019 For the three months ended September 30, 2018 Owned food, Managed and Owned food, Managed and Owned beverage and licensed Owned beverage and licensed restaurants other operations Total restaurants other operations Total Revenues: Owned net revenues $ 17,120 $ 2,065 $ — $ 19,185 $ 15,312 $ 1,960 $ — $ 17,272 Management, license and incentive fee revenue — — 2,921 2,921 — — 2,688 2,688 Total revenues 17,120 2,065 2,921 22,106 15,312 1,960 2,688 19,960 Cost and expenses: Owned operating expenses: Cost of sales 4,472 — — 4,472 4,050 — — 4,050 Other operating expenses 10,783 — — 10,783 9,779 — — 9,779 Owned food, beverage and other expenses — 1,971 — 1,971 — 2,068 — 2,068 Total owned operating expenses 15,255 1,971 — 17,226 13,829 2,068 — 15,897 Segment income (loss) $ 1,865 $ 94 $ 2,921 $ 4,880 $ 1,483 $ (108) $ 2,688 $ 4,063 General and administrative 2,352 2,266 Depreciation and amortization 1,103 896 Interest expense, net of interest income 230 294 Transaction costs 358 — Other 292 565 Income before provision for income taxes $ 545 $ 42 For the nine months ended September 30, 2019 For the nine months ended September 30, 2018 Owned food, Managed and Owned food, Managed and Owned beverage and licensed Owned beverage and licensed restaurants other operations Total restaurants other operations Total Revenues: Owned net revenues $ 53,749 $ 6,472 $ — $ 60,221 $ 45,908 $ 6,048 $ — $ 51,956 Management, license and incentive fee revenue — — 8,260 8,260 — — 7,832 7,832 Total revenues 53,749 6,472 8,260 68,481 45,908 6,048 7,832 59,788 Cost and expenses: Owned operating expenses: Cost of sales 14,109 — — 14,109 12,121 — — 12,121 Other operating expenses 33,554 — — 33,554 28,556 — — 28,556 Owned food, beverage and other expenses — 6,455 — 6,455 — 5,782 — 5,782 Total owned operating expenses 47,663 6,455 — 54,118 40,677 5,782 — 46,459 Segment income (loss) $ 6,086 $ 17 $ 8,260 $ 14,363 $ 5,231 $ 266 $ 7,832 $ 13,329 General and administrative 7,706 7,937 Depreciation and amortization 3,049 2,575 Interest expense, net of interest income 717 902 Transaction costs 510 — Loss on early debt extinguishment 437 — Equity in income of investee companies — (111) Other 712 1,359 Income before provision for income taxes $ 1,232 $ 667 The Company’s total assets by segment for the periods indicated were as follows (in thousands): September 30, December 31, 2019 2018 Total assets: Owned restaurants $ 73,753 $ 42,971 Owned food, beverage and other operations (1) 16,204 7,274 Managed and licensed operations 5,463 5,734 Total $ 95,420 $ 55,979 (1) Includes corporate assets and unallocated corporate assets The Company’s capital asset additions by segment for the periods indicated were as follows (in thousands): For the nine months ended September 30, 2019 2018 Capital assets additions: Owned restaurants $ 2,861 $ 2,792 Owned food, beverage and other operations (1) 648 446 Managed and licensed operations — — Total $ 3,509 $ 3,238 (1) Includes corporate capital asset additions and unallocated corporate additions |
Geographic Information (Tables)
Geographic Information (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Geographic Information [Abstract] | |
Schedule of revenues by geographic location | The following tables contain certain financial information by geographic location for the three and nine months ended September 30, 2019 and 2018 (in thousands): Revenues For the three months ended September 30, For the nine months ended September 30, 2019 2018 2019 2018 Domestic: Owned restaurants $ 17,120 $ 15,312 $ 53,749 $ 45,908 Owned food, beverage and other operations 2,065 1,960 6,472 6,048 Managed and licensed operations 1,545 1,469 4,827 4,797 Total domestic revenues $ 20,730 $ 18,741 $ 65,048 $ 56,753 International: Owned restaurants — — — — Owned food, beverage and other operations — — — — Managed and licensed operations 1,376 1,219 3,433 3,035 Total international revenues $ 1,376 $ 1,219 $ 3,433 $ 3,035 Total revenues $ 22,106 $ 19,960 $ 68,481 $ 59,788 |
Schedule of long-lived assets by geographic location | September 30, December 31, 2019 2018 Domestic: Owned restaurants $ 70,406 $ 38,958 Owned food, beverage and other operations 13,054 5,375 Managed and licensed operations 42 67 Total domestic long-lived assets $ 83,502 $ 44,400 International: Owned restaurants — — Owned food, beverage and other operations — — Managed and licensed operations 49 38 Total international long-lived assets $ 49 $ 38 Total long-lived assets $ 83,551 $ 44,438 |
Summary of Business and Signi_3
Summary of Business and Significant Accounting Policies (Details) $ in Millions | Oct. 04, 2019USD ($)restaurantagreement | Sep. 30, 2019item |
Number of venues | 29 | |
Number of venues including STK | 19 | |
Number of hotels provided F&B services | 3 | |
Number of casinos | 1 | |
Kona Grill | ||
Purchase price | $ | $ 25 | |
Number of domestic restaurants acquired | restaurant | 24 | |
Number of international franchise agreements acquired | agreement | 1 | |
Working capital liabilities acquired | $ | $ 11 |
Inventory (Details)
Inventory (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Inventory [Line Items] | ||
Inventory | $ 1,602 | $ 1,404 |
Food | ||
Inventory [Line Items] | ||
Inventory | 317 | 300 |
Beverages | ||
Inventory [Line Items] | ||
Inventory | $ 1,285 | $ 1,104 |
Other Current Assets (Details)
Other Current Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid taxes | $ 587 | $ 503 |
Landlord receivable | 195 | 195 |
Prepaid expenses | 926 | 680 |
Other | 94 | 93 |
Total | $ 1,802 | $ 1,471 |
Property and Equipment, net - T
Property and Equipment, net - Total PPE (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Less: accumulated depreciation and amortization | $ (19,861) | $ (16,969) |
Property and equipment, net | 39,996 | 39,347 |
Furniture, fixtures and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 12,106 | 10,425 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 45,820 | 43,890 |
Total amount net of accumulated depreciation and amortization | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | 38,065 | 37,346 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | 336 | |
Restaurant smallwares | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | $ 1,931 | $ 1,665 |
Property and Equipment, net - N
Property and Equipment, net - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation and amortization | $ 1.1 | $ 0.9 | $ 3 | $ 2.6 |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Accrued [Abstract] | ||
Variable rent, including disputed rent amounts | $ 1,305 | $ 1,766 |
Legal, professional and other services | 658 | 645 |
Payroll and related | 802 | 1,794 |
VAT and sales taxes | 259 | 1,028 |
Insurance | 212 | 212 |
Income taxes and related | 340 | 685 |
Due to hotels | 203 | |
Other | 726 | 1,760 |
Totals | $ 4,302 | $ 8,093 |
Long-Term Debt - Debt and Matur
Long-Term Debt - Debt and Maturities (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Debt Instrument [Line Items] | ||
Long-term debt | $ 14,038 | $ 10,830 |
Less: current portion of long-term debt | (1,076) | (3,201) |
Less: debt issuance costs | (707) | (32) |
Less: discounts on warrants, net | (479) | |
Long-term debt, net of current portion | 12,255 | 7,118 |
Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Long-term debt | 3,750 | |
Medium-term Notes | Term Loan Agreements | ||
Debt Instrument [Line Items] | ||
Long-term debt | 9,813 | 3,828 |
Construction Loans | Equipment Financing Agreements | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 475 | 752 |
Unsecured Debt | Promissory Notes | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 6,250 |
Long-Term Debt - Narrative (Det
Long-Term Debt - Narrative (Details) $ in Thousands | May 15, 2019USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Dec. 31, 2018USD ($) |
Debt Instrument [Line Items] | ||||||
Interest expense | $ 200 | $ 200 | $ 600 | $ 800 | ||
Letters of credit outstanding | 1,700 | 1,700 | ||||
Cash collateral letter of credit | $ 1,300 | |||||
Repayment of debt | 4,016 | $ 2,108 | ||||
Loss on early debt extinguishment | $ 400 | (437) | ||||
Repayments of related party debt | 1,197 | |||||
TOG Liquidation Trust | ||||||
Debt Instrument [Line Items] | ||||||
Repayments of related party debt | 1,200 | |||||
Credit Agreement with Bank of America, N.A. [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt issuance cost | $ 400 | |||||
Fixed charge coverage ratio | 1.35 | |||||
Credit Agreement with Bank of America, N.A. [Member] | Fiscal Quarter Ending on or Prior to June 30, 2020 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Consolidated leverage ratio | 4.75 | |||||
Credit Agreement with Bank of America, N.A. [Member] | Fiscal quarter thereafter | ||||||
Debt Instrument [Line Items] | ||||||
Consolidated leverage ratio | 4.50 | |||||
Credit Agreement with Bank of America, N.A. [Member] | Base Rate | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 0.50% | |||||
Credit Agreement with Bank of America, N.A. [Member] | Base Rate | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 0.00% | |||||
Credit Agreement with Bank of America, N.A. [Member] | One Month LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 1.00% | |||||
Goldman Sachs Credit Agreement | ||||||
Debt Instrument [Line Items] | ||||||
Debt issuance cost | $ 300 | $ 300 | ||||
Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Secured revolving credit facility | $ 10,000 | |||||
Term Loans | ||||||
Debt Instrument [Line Items] | ||||||
Term loan | $ 10,000 | |||||
Term Loans | LIBOR | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 2.75% | |||||
Term Loans | LIBOR | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 3.50% | |||||
Term Loans | Base Rate | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 1.75% | |||||
Term Loans | Base Rate | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 2.50% | |||||
Second Term Loan Agreement [Member] | Medium-term Notes | ||||||
Debt Instrument [Line Items] | ||||||
Repayment of debt | $ 2,600 | |||||
Promissory Notes | Unsecured Debt | Anson Investments Master Fund LP [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Repayment of notes payable | 5,300 | |||||
Promissory Notes | Unsecured Debt | Ontario Limited [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Repayment of notes payable | $ 1,000 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Carrying amount of long-term debt, including current portion | $ 10,288 | $ 10,830 |
Level 2 | ||
Fair value of long-term debt, including current portion | $ 8,618 | $ 7,648 |
Nonconsolidated Variable Inte_3
Nonconsolidated Variable Interest Entities - Information of Equity Investments (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Schedule of Equity Method Investments [Line Items] | ||
Equity method investments | $ 2,684 | $ 2,684 |
Bagatelle NY LA Investors, LLC (Bagatelle Investors) | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity method investments | 56 | 56 |
Bagatelle Little West 12th, LLC (Bagatelle NY) | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity method investments | $ 2,628 | $ 2,628 |
Nonconsolidated Variable Inte_4
Nonconsolidated Variable Interest Entities - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2019 | Sep. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Schedule of Equity Method Investments [Line Items] | ||||||
Equity method investments | $ 2,684 | $ 2,684 | $ 2,684 | |||
Due from related parties, net | 336 | 336 | 45 | |||
Ownership percentage equity method investment | 10.00% | |||||
Income from equity method investments | $ 111 | |||||
Bagatelle NY LA Investors, LLC (Bagatelle Investors) | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Equity method investments | $ 56 | $ 56 | $ 56 | |||
Ownership percentage equity method investment | 31.24% | 31.24% | 31.24% | |||
Bagatelle NY LA Investors, LLC (Bagatelle Investors) | Maximum | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Management fee revenue | $ 100 | $ 100 | ||||
Bagatelle Little West 12th, LLC (Bagatelle NY) | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Equity method investments | 2,628 | $ 2,628 | $ 2,628 | |||
Management fee revenue | 300 | 200 | ||||
Rental income | $ 100 | 100 | $ 400 | 400 | ||
Ownership percentage equity method investment | 51.13% | 51.13% | 51.13% | |||
One 29 Park, LLC (One 29 Park) | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Management fee revenue | $ 100 | $ 300 | ||||
Gain on sale of investments | $ 200 | |||||
Income from equity method investments | $ 600 | |||||
Variable Interest Entity, Primary Beneficiary | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Due from related parties, net | $ 300 | $ 300 | $ 100 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Thousands | May 15, 2019 | Dec. 31, 2016 | Sep. 30, 2019 | Dec. 31, 2018 |
Related Party Transaction [Line Items] | ||||
Due to related parties | $ 300 | $ 1,200 | ||
Repayment of due to related parties, long-term | 1,197 | |||
TOG Liquidation Trust | ||||
Related Party Transaction [Line Items] | ||||
Due to related parties | $ 0 | $ 1,200 | ||
Repayment of due to related parties, long-term | $ 1,200 | |||
Cash Advances | ||||
Related Party Transaction [Line Items] | ||||
Proceeds from cash advances from TOG Liquidation Trust | $ 1,200 | |||
Cash Advances | TOG Liquidation Trust | ||||
Related Party Transaction [Line Items] | ||||
Repayment of due to related parties, long-term | $ 1,200 |
Income taxes (Details)
Income taxes (Details) | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | ||
Effective income tax rate | 12.70% | 66.70% |
U.S. statutory tax rate | 21.00% |
Revenue from contracts with c_3
Revenue from contracts with customers - Receivables and Contract Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Deferred license revenue | ||
Receivables | $ 125 | $ 174 |
Deferred revenue | 1,142 | 1,179 |
Deferred gift card and gift certificate revenue | ||
Deferred revenue | $ 137 | $ 491 |
Revenue from contracts with c_4
Revenue from contracts with customers - Changes in Deferred License Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Revenue recognized during the period | $ 200 | $ 100 | $ 900 | $ 600 |
Deferred license revenue | ||||
Deferred revenue, as of December 31, 2018 | 1,179 | |||
Additions to deferred license revenue | 111 | |||
Revenue recognized during the period | (148) | |||
Deferred revenue, as of September 30, 2019 | $ 1,142 | $ 1,142 |
Revenue from contracts with c_5
Revenue from contracts with customers - Future Estimated Deferred License Revenue (Details) - Deferred license revenue $ in Thousands | Sep. 30, 2019USD ($) |
2019, nine months remaining | $ 48 |
2020 | 191 |
2021 | 191 |
2022 | 166 |
2023 | 135 |
Thereafter | 411 |
Total future estimated deferred license revenue | $ 1,142 |
Revenue from contracts with c_6
Revenue from contracts with customers - Changes in Deferred Gift Card and Gift Certificate Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Revenue recognized during the period related to redemptions | $ 200 | $ 100 | $ 900 | $ 600 |
Deferred gift card and gift certificate revenue | ||||
Deferred revenue, as of December 31, 2018 | 491 | |||
Additions to deferred gift card and gift certificates revenue | 353 | |||
Revenue recognized during the period related to redemptions | (707) | |||
Deferred revenue, as of September 30, 2019 | $ 137 | $ 137 |
Revenue from contracts with c_7
Revenue from contracts with customers - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | ||||
Revenue recognized during the period | $ 0.2 | $ 0.1 | $ 0.9 | $ 0.6 |
Leases - Changes Due to the Ado
Leases - Changes Due to the Adoption of ASC Topic 842 (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2019 | Jan. 01, 2019 | Dec. 31, 2018 | |
Lessee, Lease, Description [Line Items] | |||
Operating lease right-of-use assets | $ 39,751 | $ 41,868 | |
Current portion of operating lease liabilities | 2,488 | 3,212 | |
Operating lease liability, net of current portion | 54,775 | 55,679 | |
Deferred gift card revenue and other | 599 | 698 | $ 947 |
Deferred rent and tenant improvement allowances | $ 16,774 | ||
Accounting Standards Update 2016-02 | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease right-of-use assets | 41,800 | ||
Adjustments | Accounting Standards Update 2016-02 | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease right-of-use assets | 41,868 | ||
Current portion of operating lease liabilities | 3,212 | ||
Operating lease liability, net of current portion | 55,679 | ||
Deferred gift card revenue and other | (249) | ||
Deferred rent and tenant improvement allowances | $ (16,774) | ||
Reduction in operating lease liabilities | 1,200 | ||
Reduction in operating lease right-of-use asset | $ 1,200 |
Leases - Lease Expense (Details
Leases - Lease Expense (Details) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019USD ($) | Sep. 30, 2019USD ($) | |
Lease cost | ||
Operating lease cost | $ 5,040 | |
Variable lease cost | 1,811 | |
Short-term lease cost | 273 | |
Sublease income | $ (100) | (582) |
Total lease cost | $ 6,542 | |
Weighted average remaining lease term - operating leases | 14 years | 14 years |
Weighted average discount rate - operating leases | 8.22% | 8.22% |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Leases [Abstract] | |
Cash paid for amounts included in the measurement of operating lease liabilities | $ 5,212 |
Right-of-use assets obtained in exchange for operating lease obligations | $ 1,076 |
Leases - Operating Lease Liabil
Leases - Operating Lease Liabilities (Details) $ in Thousands | Sep. 30, 2019USD ($) |
Operating Lease Liabilities, Payments Due [Abstract] | |
2019, three months remaining | $ 1,844 |
2020 | 7,088 |
2021 | 6,839 |
2022 | 6,971 |
2023 | 7,117 |
Thereafter | 69,929 |
Total lease payments | 99,788 |
Less: imputed interest | (42,525) |
Present value of operating lease liabilities | $ 57,263 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2019 | Jan. 01, 2019 | |
Lessee, Lease, Description [Line Items] | |||
Operating lease right-of-use assets | $ 39,751 | $ 39,751 | $ 41,868 |
Operating lease liability | 57,263 | 57,263 | |
Sublease income | 100 | 582 | |
Bagatelle Little West 12th, LLC (Bagatelle NY) | |||
Lessee, Lease, Description [Line Items] | |||
Sublease income | $ 100 | $ 400 | |
Accounting Standards Update 2016-02 | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease right-of-use assets | 41,800 | ||
Operating lease liability | $ 58,900 |
Earnings per share - Calculatio
Earnings per share - Calculation (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Earnings Per Share [Abstract] | ||||
Net (loss) income attributable to The ONE Group Hospitality, Inc. | $ 460 | $ (305) | $ 992 | $ 106 |
Basic weighted average shares outstanding | 28,537,477 | 27,751,632 | 28,429,074 | 27,437,269 |
Dilutive effect of stock options, warrants and restricted share units | 1,363,667 | 1,213,852 | 62,376 | |
Diluted weighted average shares outstanding | 29,901,144 | 27,751,632 | 29,642,926 | 27,499,645 |
Net (loss) income available to common stockholders per share - Basic | $ 0.02 | $ (0.01) | $ 0.03 | $ 0 |
Net (loss) income available to common stockholders per share - Diluted | $ 0.02 | $ (0.01) | $ 0.03 | $ 0 |
Earnings per share - Narrative
Earnings per share - Narrative (Details) - shares shares in Millions | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2019 | Sep. 30, 2018 | |
Stock Options | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities excluded from the calculation of diluted earnings per share | 1 | 1 | 1.9 |
Warrants | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities excluded from the calculation of diluted earnings per share | 1 | 1.9 | |
Restricted Share Units | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities excluded from the calculation of diluted earnings per share | 1 | 1.9 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Balance | $ 13,025 | $ 12,852 | $ 12,062 | $ 7,665 | $ 6,866 | $ 6,553 | $ 12,062 | $ 6,553 |
Stock-based compensation | 338 | 456 | 181 | 337 | 344 | 324 | 975 | |
Exercise of stock options | 66 | $ 66 | ||||||
Exercise of stock options (in shares) | 30,000 | |||||||
Exercise of warrants | 1,223 | |||||||
Loss on foreign currency translation, net | (49) | (120) | (160) | (68) | 141 | (75) | $ (329) | |
Reclassification of realized gains | (102) | |||||||
Net income (loss) | 469 | (163) | 769 | (210) | 314 | 118 | ||
Adoption of ASC 606 "Revenue from contracts with customers" | (54) | |||||||
Balance | 13,849 | 13,025 | 12,852 | 8,845 | 7,665 | 6,866 | 13,849 | 8,845 |
Issuance of common stock | 1,223 | |||||||
Exercise of stock options | 66 | |||||||
Common stock | ||||||||
Balance | 3 | 3 | $ 3 | 3 | 3 | 3 | $ 3 | 3 |
Balance (in shares) | 28,313,017 | 28,313,017 | ||||||
Exercise of stock options (in shares) | 30,000 | |||||||
Vesting of restricted shares (in shares) | 187,001 | |||||||
Balance | $ 3 | 3 | $ 3 | 3 | 3 | 3 | $ 3 | 3 |
Balance (in shares) | 28,577,487 | 28,577,487 | ||||||
Additional paid-in capital | ||||||||
Balance | $ 44,180 | 43,724 | 43,543 | 41,675 | 41,331 | 41,007 | $ 43,543 | 41,007 |
Stock-based compensation | 338 | 456 | 181 | 337 | 344 | 324 | 975 | |
Exercise of stock options | 66 | 66 | ||||||
Exercise of warrants | 1,223 | |||||||
Balance | 44,584 | 44,180 | 43,724 | 43,235 | 41,675 | 41,331 | 44,584 | 43,235 |
Accumulated deficit | ||||||||
Balance | (28,190) | (27,868) | (28,722) | (31,621) | (31,802) | (31,979) | (28,722) | (31,979) |
Net income (loss) | 460 | (322) | 854 | (306) | 181 | 231 | ||
Adoption of ASC 606 "Revenue from contracts with customers" | (54) | |||||||
Balance | (27,730) | (28,190) | (27,868) | (31,927) | (31,621) | (31,802) | (27,730) | (31,927) |
Accumulated other comprehensive loss | ||||||||
Balance | (2,590) | (2,470) | (2,310) | (1,490) | (1,631) | (1,556) | (2,310) | (1,556) |
Loss on foreign currency translation, net | (49) | (120) | (160) | (68) | 141 | (75) | (329) | |
Reclassification of realized gains | (102) | |||||||
Balance | (2,639) | (2,590) | (2,470) | (1,660) | (1,490) | (1,631) | (2,639) | (1,660) |
Noncontrolling Interests | ||||||||
Balance | (378) | (537) | (452) | (902) | (1,035) | (922) | (452) | (922) |
Net income (loss) | 9 | 159 | (85) | 96 | 133 | (113) | ||
Balance | $ (369) | $ (378) | $ (537) | $ (806) | $ (902) | $ (1,035) | $ (369) | $ (806) |
Stock-Based Compensation - Valu
Stock-Based Compensation - Valuation Assumptions (Details) | 9 Months Ended |
Sep. 30, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Expected life (in years) | 8 years 6 months |
Risk-free interest rate | 2.62% |
Volatility | 42.00% |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Status of Company's Stock Option Activity (Details) $ / shares in Units, $ in Thousands | 9 Months Ended |
Sep. 30, 2019USD ($)$ / sharesshares | |
Shares | |
Outstanding at December 31, 2018 (in shares) | shares | 2,001,008 |
Granted (in shares) | shares | 68,000 |
Exercise of stock options (in shares) | shares | 30,000 |
Cancelled, expired or forfeited (in shares) | shares | (193,500) |
Outstanding at September 30, 2019 (in shares) | shares | 1,845,508 |
Exercisable at September 30, 2019 (in shares) | shares | 1,216,508 |
Weighted Average Exercise Price | |
Outstanding at December 31, 2018 (in dollars per share) | $ / shares | $ 3.29 |
Granted (in dollars per share) | $ / shares | 2.99 |
Exercised (in dollars per share) | $ / shares | 2.23 |
Cancelled, expired or forfeited (in dollars per share) | $ / shares | 2.74 |
Outstanding at September 30, 2019 (in dollars per share) | $ / shares | 3.35 |
Exercisable at September 30, 2019 (in dollars per share) | $ / shares | $ 4.04 |
Weighted Average Remaining Contractual Life (Years) | |
Weighted Average Remaining Contractual Life at September 30, 2019 | 6 years 1 month 17 days |
Exercisable Weighted Average Remaining Contractual Life at September 30, 2019 | 5 years 2 months 9 days |
Intrinsic Value | |
Intrinsic Value Outstanding at September 30, 2019 | $ | $ 810 |
Intrinsic Value Exercisable at September 30, 2019 | $ | $ 302 |
Stock-Based Compensation - Su_2
Stock-Based Compensation - Summary of Non-Vested Stock Options (Details) | 9 Months Ended |
Sep. 30, 2019$ / sharesshares | |
Shares | |
Non-vested stock options at December 31, 2018 (in shares) | shares | 926,500 |
Granted | shares | 68,000 |
Vested (in shares) | shares | (215,500) |
Cancelled, expired or forfeited (in shares) | shares | (150,000) |
Non-vested stock options at September 30, 2019 (in shares) | shares | 629,000 |
Weighted Average Grant Date Fair Value | |
Non-vested stock options at December 31, 2018 (in dollars per share) | $ / shares | $ 0.91 |
Granted (in dollars per share) | $ / shares | 2.99 |
Vested (in dollars per share) | $ / shares | 1.29 |
Cancelled, expired or forfeited (in dollars per share) | $ / shares | 0.95 |
Non-vested stock options at September 30, 2019 (in dollars per share) | $ / shares | $ 0.84 |
Stock-Based Compensation - Su_3
Stock-Based Compensation - Summary of Status of Company's Restricted Stock Option Activity (Details) | 9 Months Ended |
Sep. 30, 2019$ / sharesshares | |
Shares | |
Non-vested RSUs at December 31, 2018 (in shares) | shares | 764,201 |
Granted (in shares) | shares | 466,905 |
Vested (in shares) | shares | (187,001) |
Cancelled, expired or forfeited (in shares) | shares | (81,000) |
Non-vested RSUs at September 30, 2019 (in shares) | shares | 963,105 |
Weighted Average Grant Date Fair Value | |
Non-vested RSUs at December 31, 2018 (in dollars per share) | $ / shares | $ 2.54 |
Granted (in dollars per share) | $ / shares | 3.05 |
Vested (in dollars per share) | $ / shares | 2.54 |
Cancelled, expired or forfeited (in dollars per share) | $ / shares | 2.48 |
Non-vested RSUs at September 30, 2019 (in dollars per share) | $ / shares | $ 2.63 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Jun. 04, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock-based compensation | $ 338 | $ 337 | $ 975 | $ 1,005 | ||
Options outstanding (in shares) | 1,845,508 | 1,845,508 | 2,001,008 | |||
General and Administrative Expense. | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock-based compensation | $ 300 | $ 300 | $ 1,000 | $ 1,000 | ||
Restricted Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Unrecognized compensation cost related to non-vested awards | $ 1,800 | $ 1,800 | ||||
Unrecognized compensation cost, recognition period | 2 years 9 months 18 days | |||||
Restricted shares outstanding | 150,000 | 150,000 | ||||
Stock Options | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Unrecognized compensation cost related to non-vested awards | $ 400 | $ 400 | ||||
Unrecognized compensation cost, recognition period | 3 years | |||||
Milestone-Based Options | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Options outstanding (in shares) | 579,402 | 579,402 | ||||
Unrecognized compensation cost related to non-vested awards | $ 700 | $ 700 | ||||
Equity Incentive Plan 2019 [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Remaining shares available for issuance | 2,589,077 | 2,589,077 | ||||
Authorized shares (in shares) | 7,073,922 | 7,073,922 | 2,300,000 |
Segment Reporting - Operating R
Segment Reporting - Operating Results by Segments (Details) $ in Thousands | May 15, 2019USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($)segment | Sep. 30, 2018USD ($) |
Segment reporting | |||||
Number of operating segments | segment | 3 | ||||
Increase in total assets | $ 39,800 | ||||
Revenues: | |||||
Management, license and incentive fee revenue | $ 2,921 | $ 2,688 | 8,260 | $ 7,832 | |
Total revenues | 22,106 | 19,960 | 68,481 | 59,788 | |
Owned operating expenses: | |||||
Cost of sales | 4,472 | 4,050 | 14,109 | 12,121 | |
Owned food, beverage and other expenses | 1,971 | 2,068 | 6,455 | 5,782 | |
Total owned operating expenses | 17,226 | 15,897 | 54,118 | 46,459 | |
General and administrative | 2,352 | 2,266 | 7,706 | 7,937 | |
Depreciation and amortization | 1,103 | 896 | 3,049 | 2,575 | |
Interest expense, net of interest income | 230 | 294 | 717 | 902 | |
Transaction costs | 358 | 510 | |||
Loss on early debt extinguishment | $ (400) | 437 | |||
Equity in income of investee companies | (111) | ||||
Other | 40 | 38 | (226) | (139) | |
Income before provision for income taxes | 545 | 42 | 1,232 | 667 | |
Operating segment | |||||
Revenues: | |||||
Owned net revenues | 19,185 | 17,272 | 60,221 | 51,956 | |
Management, license and incentive fee revenue | 2,921 | 2,688 | 8,260 | 7,832 | |
Total revenues | 22,106 | 19,960 | 68,481 | 59,788 | |
Owned operating expenses: | |||||
Cost of sales | 4,472 | 4,050 | 14,109 | 12,121 | |
Other operating expenses | 10,783 | 9,779 | 33,554 | 28,556 | |
Owned food, beverage and other expenses | 1,971 | 2,068 | 6,455 | 5,782 | |
Total owned operating expenses | 17,226 | 15,897 | 54,118 | 46,459 | |
Segment income (loss) | 4,880 | 4,063 | 14,363 | 13,329 | |
General and administrative | 2,352 | 2,266 | 7,706 | 7,937 | |
Depreciation and amortization | 1,103 | 896 | 3,049 | 2,575 | |
Interest expense, net of interest income | 230 | 294 | 717 | 902 | |
Transaction costs | 358 | 0 | 510 | ||
Loss on early debt extinguishment | 437 | ||||
Equity in income of investee companies | (111) | ||||
Other | 292 | 565 | 712 | 1,359 | |
Income before provision for income taxes | 545 | 42 | 1,232 | 667 | |
Operating segment | Owned restaurants | |||||
Revenues: | |||||
Owned net revenues | 17,120 | 15,312 | 53,749 | 45,908 | |
Management, license and incentive fee revenue | 0 | 0 | |||
Total revenues | 17,120 | 15,312 | 53,749 | 45,908 | |
Owned operating expenses: | |||||
Cost of sales | 4,472 | 4,050 | 14,109 | 12,121 | |
Other operating expenses | 10,783 | 9,779 | 33,554 | 28,556 | |
Owned food, beverage and other expenses | 0 | 0 | |||
Total owned operating expenses | 15,255 | 13,829 | 47,663 | 40,677 | |
Segment income (loss) | 1,865 | 1,483 | 6,086 | 5,231 | |
Operating segment | Owned food, beverage and other operations | |||||
Revenues: | |||||
Owned net revenues | 2,065 | 1,960 | 6,472 | 6,048 | |
Management, license and incentive fee revenue | 0 | 0 | |||
Total revenues | 2,065 | 1,960 | 6,472 | 6,048 | |
Owned operating expenses: | |||||
Cost of sales | 0 | 0 | |||
Other operating expenses | 0 | 0 | |||
Owned food, beverage and other expenses | 1,971 | 2,068 | 6,455 | 5,782 | |
Total owned operating expenses | 1,971 | 2,068 | 6,455 | 5,782 | |
Segment income (loss) | 94 | (108) | 17 | 266 | |
Operating segment | Managed and licensed operations | |||||
Revenues: | |||||
Owned net revenues | 0 | 0 | |||
Management, license and incentive fee revenue | 2,921 | 2,688 | 8,260 | 7,832 | |
Total revenues | 2,921 | 2,688 | 8,260 | 7,832 | |
Owned operating expenses: | |||||
Cost of sales | 0 | 0 | |||
Other operating expenses | 0 | 0 | |||
Owned food, beverage and other expenses | 0 | 0 | |||
Total owned operating expenses | 0 | 0 | |||
Segment income (loss) | $ 2,921 | $ 2,688 | $ 8,260 | $ 7,832 |
Segment Reporting - Total Asset
Segment Reporting - Total Assets by Segment (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 | Sep. 30, 2018 |
Segment reporting | |||
Total assets | $ 95,420 | $ 55,979 | |
Operating segment | |||
Segment reporting | |||
Total assets | 95,420 | 55,979 | |
Total capital asset additions | 3,509 | $ 3,238 | |
Operating segment | Owned restaurants | |||
Segment reporting | |||
Total assets | 73,753 | 42,971 | |
Total capital asset additions | 2,861 | 2,792 | |
Operating segment | Owned food, beverage and other operations | |||
Segment reporting | |||
Total assets | 16,204 | 7,274 | |
Total capital asset additions | 648 | 446 | |
Operating segment | Managed and licensed operations | |||
Segment reporting | |||
Total assets | 5,463 | $ 5,734 | |
Total capital asset additions | $ 0 | $ 0 |
Geographic Information (Details
Geographic Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Revenues | $ 22,106 | $ 19,960 | $ 68,481 | $ 59,788 | |
Long-Lived Assets | 83,551 | 83,551 | $ 44,438 | ||
Domestic | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Revenues | 20,730 | 18,741 | 65,048 | 56,753 | |
Long-Lived Assets | 83,502 | 83,502 | 44,400 | ||
Domestic | Owned restaurants | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Revenues | 17,120 | 15,312 | 53,749 | 45,908 | |
Long-Lived Assets | 70,406 | 70,406 | 38,958 | ||
Domestic | Owned food, beverage and other operations | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Revenues | 2,065 | 1,960 | 6,472 | 6,048 | |
Long-Lived Assets | 13,054 | 13,054 | 5,375 | ||
Domestic | Managed and licensed operations | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Revenues | 1,545 | 1,469 | 4,827 | 4,797 | |
Long-Lived Assets | 42 | 42 | 67 | ||
International | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Revenues | 1,376 | 1,219 | 3,433 | 3,035 | |
Long-Lived Assets | 49 | 49 | 38 | ||
International | Owned restaurants | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Revenues | 0 | 0 | 0 | 0 | |
Long-Lived Assets | 0 | 0 | 0 | ||
International | Owned food, beverage and other operations | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Revenues | 0 | 0 | 0 | 0 | |
Long-Lived Assets | 0 | 0 | 0 | ||
International | Managed and licensed operations | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Revenues | 1,376 | $ 1,219 | 3,433 | $ 3,035 | |
Long-Lived Assets | $ 49 | $ 49 | $ 38 |
Subsequent Events (Details)
Subsequent Events (Details) | Oct. 04, 2019USD ($)restaurantagreement | May 15, 2019USD ($) |
Revolving Credit Facility | ||
Subsequent Event [Line Items] | ||
Secured revolving credit facility | $ 10,000,000 | |
Term Loans | ||
Subsequent Event [Line Items] | ||
Term loan | $ 10,000,000 | |
Kona Grill | ||
Subsequent Event [Line Items] | ||
Number of domestic restaurants acquired | restaurant | 24 | |
Number of international franchise agreements acquired | agreement | 1 | |
Purchase price | $ 25,000,000 | |
Working capital liabilities acquired | 11,000,000 | |
Minimum | Term Loans | LIBOR | ||
Subsequent Event [Line Items] | ||
Basis spread on variable rate | 2.75% | |
Minimum | Term Loans | Base Rate | ||
Subsequent Event [Line Items] | ||
Basis spread on variable rate | 1.75% | |
Maximum | Term Loans | LIBOR | ||
Subsequent Event [Line Items] | ||
Basis spread on variable rate | 3.50% | |
Maximum | Term Loans | Base Rate | ||
Subsequent Event [Line Items] | ||
Basis spread on variable rate | 2.50% | |
Subsequent Event [Member] | Revolving Credit Facility | ||
Subsequent Event [Line Items] | ||
Secured revolving credit facility | 12,000,000 | |
Subsequent Event [Member] | Term Loans | ||
Subsequent Event [Line Items] | ||
Term loan | $ 48,000,000 | |
Subsequent Event [Member] | Goldman Sachs Credit Agreement | ||
Subsequent Event [Line Items] | ||
Basis spread on variable rate | 4.75% | |
Subsequent Event [Member] | Goldman Sachs Credit Agreement | LIBOR | ||
Subsequent Event [Line Items] | ||
Basis spread on variable rate | 1.75% | |
Subsequent Event [Member] | Goldman Sachs Credit Agreement | Base Rate | ||
Subsequent Event [Line Items] | ||
Basis spread on variable rate | 0.50% | |
Subsequent Event [Member] | Goldman Sachs Credit Agreement | One Month LIBOR | ||
Subsequent Event [Line Items] | ||
Basis spread on variable rate | 1.00% | |
Subsequent Event [Member] | Goldman Sachs Credit Agreement | Fiscal quarter ending on or prior to June 30, 2021 | ||
Subsequent Event [Line Items] | ||
Fixed charge coverage ratio | 1.35 | |
Subsequent Event [Member] | Goldman Sachs Credit Agreement | Fiscal quarter thereafter | ||
Subsequent Event [Line Items] | ||
Fixed charge coverage ratio | 1.50 | |
Consolidated leverage ratio | 1.50 | |
Subsequent Event [Member] | Goldman Sachs Credit Agreement | Fiscal quarter ending on or prior to March 31, 2020 | ||
Subsequent Event [Line Items] | ||
Consolidated leverage ratio | 2.75 | |
Subsequent Event [Member] | Goldman Sachs Credit Agreement | Fiscal quarter ending June 30, 2020 | ||
Subsequent Event [Line Items] | ||
Consolidated leverage ratio | 2.50 | |
Subsequent Event [Member] | Goldman Sachs Credit Agreement | Fiscal quarters ending September 30, 2020 and December 31, 2020, | ||
Subsequent Event [Line Items] | ||
Consolidated leverage ratio | 2.25 | |
Subsequent Event [Member] | Goldman Sachs Credit Agreement | Fiscal quarter ending March 31, 2021 | ||
Subsequent Event [Line Items] | ||
Consolidated leverage ratio | 2 | |
Subsequent Event [Member] | Goldman Sachs Credit Agreement | Fiscal quarter ending June 30, 2021 | ||
Subsequent Event [Line Items] | ||
Consolidated leverage ratio | 1.75 | |
Subsequent Event [Member] | Goldman Sachs Credit Agreement | Fiscal quarter ending September 30, 2021 | ||
Subsequent Event [Line Items] | ||
Consolidated leverage ratio | 1.70 | |
Subsequent Event [Member] | Goldman Sachs Credit Agreement | Fiscal quarter ending December 21, 2021 | ||
Subsequent Event [Line Items] | ||
Consolidated leverage ratio | 1.65 | |
Subsequent Event [Member] | Kona Grill | ||
Subsequent Event [Line Items] | ||
Number of domestic restaurants acquired | restaurant | 24 | |
Number of international franchise agreements acquired | agreement | 1 | |
Purchase price | $ 25,000,000 | |
Working capital liabilities acquired | $ 11,000,000 | |
Subsequent Event [Member] | Minimum | Base Rate | ||
Subsequent Event [Line Items] | ||
Basis spread on variable rate | 4.75% | |
Subsequent Event [Member] | Minimum | Term Loans | LIBOR | ||
Subsequent Event [Line Items] | ||
Basis spread on variable rate | 5.75% | |
Subsequent Event [Member] | Minimum | Goldman Sachs Credit Agreement | ||
Subsequent Event [Line Items] | ||
Minimum consolidated liquidity | $ 1,500,000 | |
Subsequent Event [Member] | Maximum | Term Loans | LIBOR | ||
Subsequent Event [Line Items] | ||
Basis spread on variable rate | 6.75% | |
Subsequent Event [Member] | Maximum | Term Loans | Base Rate | ||
Subsequent Event [Line Items] | ||
Basis spread on variable rate | 5.75% | |
Subsequent Event [Member] | Maximum | Goldman Sachs Credit Agreement | Fiscal year 2020 | ||
Subsequent Event [Line Items] | ||
Maximum consolidated capital expenditures | $ 10,000,000 | |
Subsequent Event [Member] | Maximum | Goldman Sachs Credit Agreement | Fiscal year 2021 and every fiscal year thereafter | ||
Subsequent Event [Line Items] | ||
Maximum consolidated capital expenditures | $ 8,000,000 |