Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2022 | May 13, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Mar. 31, 2022 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2022 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 000-56145 | |
Entity Registrant Name | AMERGENT HOSPITALITY GROUP INC. | |
Entity Central Index Key | 0001805024 | |
Entity Tax Identification Number | 84-4842958 | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 7529 Red Oak Lane | |
Entity Address, City or Town | Charlotte | |
Entity Address, State or Province | NC | |
Entity Address, Postal Zip Code | 28226 | |
City Area Code | (704) | |
Local Phone Number | 366-5122 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 15,706,736 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash | $ 2,528 | $ 646 |
Restricted cash | 623 | 1,672 |
Investments | 46 | 50 |
Accounts and other receivables | 271 | 865 |
Inventories | 184 | 182 |
Prepaid expenses and other current assets | 258 | 360 |
TOTAL CURRENT ASSETS | 3,910 | 3,775 |
Property and equipment, net | 3,041 | 3,115 |
Operating lease asset | 8,336 | 8,021 |
Intangible assets, net | 3,038 | 3,129 |
Goodwill | 7,810 | 7,810 |
Investments | 16 | 16 |
Deposits and other assets | 353 | 352 |
TOTAL ASSETS | 26,504 | 26,218 |
Current liabilities: | ||
Accounts payable and accrued expenses | 6,799 | 6,844 |
Current maturities of long-term debt and notes payable | 3,651 | 3,264 |
Current operating lease liabilities | 4,425 | 4,599 |
Deferred grant income | 997 | 1,545 |
TOTAL CURRENT LIABILITIES | 15,872 | 16,252 |
Long-term operating lease liabilities | 8,897 | 8,644 |
Contract liabilities | 82 | 757 |
Deferred tax liabilities | 150 | 150 |
Long-term debt and notes payable (includes debt measured at fair value of $483 and $599 at March 31, 2022 and December 31, 2021, respectively) | 7,440 | 6,593 |
TOTAL LIABILITIES | 32,441 | 32,396 |
Commitments and contingencies (see Note 10) | ||
Convertible Preferred Stock: Series 2: $1,000 stated value; authorized 1,500 shares; 100 issued and outstanding at both March 31, 2022 and December 31, 2021 | 58 | 58 |
Stockholders’ Deficit: | ||
Common stock: $0.0001 par value; authorized 50,000,000 shares; 15,706,736 shares issued and outstanding at both March 31, 2022 and December 31, 2021 | 2 | 2 |
Additional paid-in-capital | 93,151 | 92,882 |
Accumulated deficit | (97,990) | (97,963) |
Total Amergent Hospitality Group Inc. Stockholders’ Deficit | (4,837) | (5,079) |
Non-controlling interests | (1,158) | (1,157) |
TOTAL STOCKHOLDERS’ DEFICIT | (5,995) | (6,236) |
TOTAL LIABILITIES, REDEEMABLE SHARES AND STOCKHOLDERS’ DEFICIT | $ 26,504 | $ 26,218 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Notes payable fair value disclosure | $ 483 | $ 599 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 15,706,736 | 15,706,736 |
Common stock, shares, outstanding | 15,706,736 | 15,706,736 |
Convertible Preferred Stock: Series 2 [Member] | ||
Convertible preferred stock, par value | $ 1,000 | $ 1,000 |
Convertible preferred stock, shares authorized | 1,500 | 1,500 |
Convertible Preferred Stock, shares issued | 100 | 100 |
Convertible Preferred Stock, shares outstanding | 100 | 100 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Revenue: | ||
Total revenue | $ 5,650 | $ 4,593 |
Expenses: | ||
Restaurant cost of sales | 1,492 | 1,316 |
Restaurant operating expenses | 3,479 | 3,245 |
General and administrative expenses | 1,336 | 1,166 |
Asset impairment charges | 1,288 | |
Depreciation and amortization | 222 | 232 |
Grant income | (548) | |
Total expenses | 5,981 | 7,247 |
Operating loss | (331) | (2,654) |
Other income (expense): | ||
Interest expense | (187) | (157) |
Change in fair value of derivative liabilities | 185 | |
Change in fair value of investment | (4) | 4 |
Change in fair value of convertible promissory note | 116 | |
Gain on extinguished lease liabilities | 43 | |
Gain on extinguished trade payable | 161 | |
Other income | 219 | 2 |
Total other income | 305 | 77 |
Loss before income taxes | (26) | (2,577) |
Income tax expense | (2) | |
Consolidated net loss | (28) | (2,577) |
Less: Net loss attributable to non-controlling interests | 1 | 165 |
Net loss attributable to Amergent Hospitality Group Inc. | $ (27) | $ (2,412) |
Net loss attributable to Amergent Hospitality Group Inc. per common share, basic and diluted | $ 0 | $ (0.17) |
Weighted average shares outstanding, basic and diluted | 15,706,736 | 14,482,736 |
Restaurant Sales Net [Member] | ||
Revenue: | ||
Total revenue | $ 4,758 | $ 4,444 |
Gaming Income Net [Member] | ||
Revenue: | ||
Total revenue | 103 | 57 |
Franchise Income [Member] | ||
Revenue: | ||
Total revenue | $ 789 | $ 92 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Income Statement [Abstract] | ||
Net loss attributable to Amergent Hospitality Group Inc. | $ (27) | $ (2,412) |
Foreign currency translation gain | 9 | |
Comprehensive loss | $ (27) | $ (2,403) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' Deficit - USD ($) $ in Thousands | Temporary Equity Preferred Series 2 [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | AOCI Attributable to Parent [Member] | Noncontrolling Interest [Member] | Total |
Beginning balance at Dec. 31, 2020 | $ 460 | $ 1 | $ 92,433 | $ (94,587) | $ (26) | $ (970) | $ (3,149) |
Beginning balance, shares at Dec. 31, 2020 | 787 | 14,282,736 | |||||
Net loss | (2,412) | (165) | (2,577) | ||||
Conversion of preferred stock into common stock | $ (73) | 73 | 73 | ||||
Conversion of preferred stock into common stock, shares | (125) | 250,000 | |||||
Foreign currency translation | 9 | 9 | |||||
Ending balance at Mar. 31, 2021 | $ 387 | $ 1 | 92,506 | (96,999) | (17) | (1,135) | (5,644) |
Ending balance, shares at Mar. 31, 2021 | 662 | 14,532,736 | |||||
Beginning balance at Dec. 31, 2020 | $ 460 | $ 1 | 92,433 | (94,587) | (26) | (970) | (3,149) |
Beginning balance, shares at Dec. 31, 2020 | 787 | 14,282,736 | |||||
Ending balance at Dec. 31, 2021 | $ 58 | $ 2 | 92,882 | (97,963) | (1,157) | (6,236) | |
Ending balance, shares at Dec. 31, 2021 | 100 | 15,706,736 | |||||
Share-based compensation expense | 6 | 6 | |||||
Issuance of warrants | 263 | 263 | |||||
Net loss | (27) | (1) | (28) | ||||
Foreign currency translation | |||||||
Ending balance at Mar. 31, 2022 | $ 58 | $ 2 | $ 93,151 | $ (97,990) | $ (1,158) | $ (5,995) | |
Ending balance, shares at Mar. 31, 2022 | 100 | 15,706,736 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Cash flows from operating activities: | ||
Net loss | $ (28) | $ (2,577) |
Adjustments to reconcile net loss to net cash flows used in operating activities: | ||
Depreciation and amortization | 222 | 232 |
Amortization of operating lease assets | 330 | 226 |
Asset impairment charges | 1,288 | |
Gain on extinguished lease liabilities | (43) | |
Share-based compensation | 6 | |
Change in fair value of investment | 4 | (4) |
Change in fair value of convertible promissory note | (116) | |
Amortization of debt discount | 43 | 45 |
Change in fair value of derivative liabilities | (185) | |
Change in operating assets and liabilities: | ||
Accounts and other receivables | 594 | 221 |
Inventories | (2) | 3 |
Prepaid expenses and other assets | 101 | 182 |
Accounts payable and accrued expenses | (72) | 328 |
Deferred grant income | (548) | |
Operating lease liabilities | (566) | (382) |
Contract liabilities | (675) | (18) |
Net cash flows used in operating activities | (707) | (684) |
Cash flows from investing activities: | ||
Purchase of property and equipment | (57) | (2) |
Net cash flows used in investing activities | (57) | (2) |
Cash flows from financing activities: | ||
Proceeds from long-term debt and notes payable | 1,647 | 2,000 |
Payments of long-term debt and notes payable | (41) | (45) |
Payment of financing costs | (9) | |
Net cash flows provided by financing activities | 1,597 | 1,955 |
Effect of exchange rate on cash | 7 | |
Net increase in cash and restricted cash | 833 | 1,276 |
Cash and restricted cash, beginning of period | 2,318 | 1,929 |
Cash and restricted cash, end of period | 3,151 | 3,205 |
Supplemental cash flow information: | ||
Interest | 127 | 204 |
Income taxes | 2 | 3 |
Non-cash investing and financing activities: | ||
Conversion of Preferred Series 2 stock to common stock | 73 | |
Change in operating lease assets and liabilities due to amended leases | 645 | |
Issuance of warrants in connection with convertible promissory notes | 263 | |
Financing costs included in accounts payable and accrued expenses | $ 27 |
NATURE OF BUSINESS
NATURE OF BUSINESS | 3 Months Ended |
Mar. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF BUSINESS | 1. NATURE OF BUSINESS BASIS OF PRESENTATION Amergent Hospitality Group Inc. (“Amergent”) was incorporated on February 18, 2020 as a wholly-owned subsidiary of Chanticleer Holdings, Inc. (“Chanticleer”) for the purpose of conducting the business of Chanticleer and its subsidiaries after completion of the spin-off of Amergent to the shareholders of Chanticleer (Spin-Off”). The Spin-Off transaction was completed on April 1, 2020 in connection with Chanticleer’s completion of its merger transaction (the “Merger”) with Sonnet BioTherapeutics, Inc. (“Sonnet”). Amergent is in the business of owning, operating and franchising fast casual dining concepts. The accompanying condensed consolidated financial statements include the accounts of Amergent and its subsidiaries (collectively “we,” “us,” “our,” or the “Company”). All intercompany and inter-entity balances have been eliminated in consolidation. GENERAL The accompanying condensed consolidated financial statements included in this Report have been prepared by the Company pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) for interim reporting and include all adjustments (consisting only of normal recurring adjustments) that are, in the opinion of management, necessary for a fair presentation. These condensed consolidated financial statements have not been audited. The condensed consolidated balance sheet as of December 31, 2021 has been derived from the audited consolidated financial statements as of December 31, 2021 and for the year then ended included in Amergent’s annual report filed with the SEC on April 15, 2022. The results of operations for the three-month period ended March 31, 2022 are not necessarily indicative of the operating results for the full year ending December 31, 2022. Certain information and footnote disclosures normally included in unaudited condensed consolidated financial statements prepared in accordance with generally accepted accounting principles of the United States (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations for interim reporting. The Company believes that the disclosures contained herein are adequate to make the information presented not misleading. However, these financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in Amergent’s Annual Report on Form 10-K for the year ended December 31, 2021 previously filed with the SEC. LIQUIDITY, CAPITAL RESOURCES AND GOING CONCERN As of March 31, 2022, the Company’s cash balance was $ 3.1 0.6 12.0 ● our ability to access the capital and debt markets to satisfy current obligations and operate the business; ● our ability to qualify for and access financial stimulus programs available through federal and state government programs; ● our ability to refinance or otherwise extend maturities of current debt obligations; ● our ability to manage our operating expenses and maintain gross margins; ● popularity of and demand for our fast-casual dining concepts; and ● general economic conditions and changes in consumer discretionary income. We have typically funded our operating costs, acquisition activities, working capital requirements and capital expenditures with proceeds from the issuances of our common stock and other financing arrangements, including convertible debt, lines of credit, notes payable, capital leases, government stimulus funds and other forms of external financing. The Company expects to have to seek additional debt or equity funding to support operations and there can be no assurances that such funding would be available at commercially reasonable terms, if at all. As Amergent executes its business plan over the next 12 months, it intends to carefully monitor its working capital needs and cash balances relative to the availability of cost-effective debt and equity financing. In the event that capital is not available, Amergent may then have to scale back or freeze its growth plans, sell assets on less than favorable terms, reduce expenses, and/or curtail future acquisition plans to manage its liquidity and capital resources. In early March 2020, the COVID-19 pandemic was declared to be a National Public Health Emergency, and the Centers for Disease Control and Prevention, as well as state and local legislative bodies and health departments, began issuing orders related to social distancing requirements, reduced restaurant seating capacity and other restrictions which resulted in a significant reduction in traffic at the Company’s restaurants. As of mid-March 2020, the ordinances tightened, and dine-in capacity was eliminated or severely restricted. By April 2020, at the request of most state and local legislative bodies, the Company closed all of its dining rooms and began to operate in a take-out and delivery only capacity. In early May 2020, states began allowing the re-opening of dining rooms in a limited capacity and by the end of June 2020, the Company had re-opened dining rooms in approximately 95% of its restaurants while adhering to social distancing restrictions, which limited the number of guests it could serve in its restaurants at one time. During November 2020, rising case rates resulted in certain jurisdictions implementing restrictions that again reduced dining room capacity or mandated the closure of dining rooms. As a result, the Company began fiscal 2021 with significant limitations on its operations which, over the course of the fiscal year, varied widely from time to time, state to state and city to city; however, nonetheless negatively impacted its sales. Once COVID-19 vaccines were approved and moved into wider distribution in the United States in early to mid-2021, public health conditions improved and almost all of the COVID-19 restrictions on businesses eased. While cases continue to decline and staffing continues to improve, overall consumer and business activity remains muted in certain markets as consumer behaviors have changed due to the COVID-19 pandemic and some businesses have yet to bring employees back into their offices. The Company’s restaurant operations have been, and could again in the future, be disrupted by team member staffing issues because of illness, exclusion, fear of contracting COVID-19 or caring for family members due to COVID-19, legal requirements for employee vaccinations or COVID testing, lack of labor supply, competitive labor pressures, or for other reasons. Furthermore, inflation has been and is elevated across the Company’s business, including food costs, due in part to the supply chain impacts of the pandemic. The Company remains in regular contact with its major suppliers and while, to date, it has not experienced significant disruptions in its supply chain due to the COVID-19 pandemic, the Company could see significant future disruptions should the impacts of the pandemic continue. Currently, national, state and local jurisdictions have removed their capacity restrictions on businesses and, therefore, the Company’s restaurants are serving customers in its dining rooms without social distancing requirements. However, it is possible additional outbreaks could lead to restrictive measures that could impact the Company’s guest demand and dining room capacity. The Company’s current operating losses, combined with its working capital deficit and uncertainties regarding the impact of COVID-19, raise substantial doubt about its ability to continue as a going concern. The accompanying condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | 2. SIGNIFICANT ACCOUNTING POLICIES There have been no changes to our significant accounting policies described in our Annual Report on Form 10-K for the year ended December 31, 2021 filed with the SEC on April 15, 2022, that would have had a significant impact on these unaudited condensed consolidated financial statements and related notes. BASIS OF PRESENTATION The accompanying condensed consolidated financial statements have been prepared in conformity with U.S. GAAP. Any reference in these notes to applicable guidance is meant to refer to U.S. GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) promulgated by the Financial Accounting Standards Board (“FASB”). Certain prior year amounts have been updated to conform to the current period presentation. The Company has opted to present the financial information on the condensed consolidated balance sheets and condensed consolidated statements of operations, comprehensive loss, stockholders’ deficit and cash flows in thousands. USE OF ESTIMATES The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Significant estimates include valuing options, warrants and convertible notes payable using Black-Scholes and Monte Carlo models, and analysis of the recoverability of goodwill and long-lived assets. Actual results could differ from those estimates, particularly given the significant social and economic disruptions and uncertainties associated with the ongoing COVID-19 pandemic and the COVID-19 control responses. FAIR VALUE OF FINANCIAL INSTRUMENTS The Company measures and records certain financial assets and liabilities at fair value on a recurring basis. U.S. GAAP provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority, referred to as Level 1, to quoted prices in active markets for identical assets and liabilities. The next priority, referred to as Level 2, is given to quoted prices for similar assets or liabilities in active markets or quoted prices for identical or similar assets or liabilities in markets that are not active; that is, markets in which there are few transactions for the asset or liability. The lowest priority, referred to as Level 3, is given to unobservable inputs. The table below reflects the level of the inputs used in the Company’s fair value calculations: SCHEDULE OF FAIR VALUE MEASUREMENTS, RECURRING AND NONRECURRING (in thousands) Quoted Prices in Active Markets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Fair Value March 31, 2022 Assets (Note 4) Common stock of Sonnet $ 46 $ — $ — $ 46 Liabilities (Note 3) Convertible note payable $ — $ — $ 983 $ 983 (in thousands) Quoted Prices in Active Markets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Fair Value December 31, 2021 Assets (Note 4) Common stock of Sonnet $ 50 $ — $ — $ 50 Common stock of Sonnet $ 50 $ — $ — $ 50 Liabilities (Note 3) Convertible note payable $ — $ — $ 1,099 $ 1,099 Convertible note payable $ — $ — $ 1,099 $ 1,099 Inputs used in the Company’s Level 3 calculation of fair value for the convertible note payable are discussed in Note 3. The Company is required to disclose fair value information about financial instruments when it is practicable to estimate that value. The carrying amounts of the Company’s cash, restricted cash, accounts receivable, other receivables, accounts payable, other current liabilities, convertible notes payable (other than the convertible note payable discussed above) and notes payable approximate fair value due to the short-term maturities of these financial instruments and/or because related interest rates offered to the Company approximate current rates. SEGMENTS Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company operates under four brands but views its operations and manages its business in one CASH Cash consists of deposits held at financial institutions and is stated at fair value. The Company limits its credit risk associated with cash by maintaining its bank accounts at major financial institutions. RESTRICTED CASH As of March 31, 2022 and December 31, 2021, the Company maintained restricted cash of $ 0.6 1.7 restaurant revitalization fund For purposes of the condensed consolidated cash flow statements, the restricted cash is aggregated with cash of $ 2.5 2.4 3.1 3.2 PROPERTY AND EQUIPMENT Property and equipment are stated at cost, less accumulated depreciation. Depreciation and amortization are recorded generally using the straight-line method over the estimated useful lives of the respective assets. Leasehold improvements are amortized over the lesser of the expected lease term or the estimated useful lives of the related assets using the straight-line method. Maintenance and repairs that do not improve or extend the useful lives of the assets are not considered assets and are charged to expense when incurred. The estimated useful lives used to compute depreciation and amortization are as follows: SCHEDULE OF PROPERTY AND EQUIPMENT USEFUL LIVES Leasehold improvements 5 15 Restaurant furnishings and equipment 3 10 Furniture and fixtures 3 10 Office and computer equipment 3 7 INTANGIBLE ASSETS Trademark/Tradenames Certain of the Company’s trademark/tradenames have been determined to have a definite life and are being amortized on a straight-line basis over estimated useful lives of 3 10 long-lived assets LONG-LIVED ASSETS Long-lived assets, such as property and equipment, operating lease assets, and purchased intangible assets subject to depreciation and amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Some of the events or changes in circumstances that would trigger an impairment test include, but are not limited to: ● significant under-performance relative to expected and/or historical results (negative comparable sales growth or operating cash flows for two consecutive years); ● significant negative industry or economic trends; ● knowledge of transactions involving the sale of similar property at amounts below the Company’s carrying value; or ● the Company’s expectation to dispose of long-lived assets before the end of their estimated useful lives, even though the assets do not meet the criteria to be classified as “Held for Sale.” If circumstances require a long-lived asset or asset group be tested for possible impairment, the Company first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying value. If the carrying value of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying value exceeds its fair value. Fair value is determined through various valuation techniques, including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. During 2021, the Company determined that events occurred, some of which were related to the COVID-19 pandemic, requiring management to review certain long-lived assets for impairment. Refer to Notes 5, 6 and 10 for further discussion. There were no such indicators of impairment of long-lived assets during the three months ended March 31, 2022. GOODWILL Goodwill, which is not subject to amortization, is evaluated for impairment annually as of the end of the Company’s year-end, or more frequently if an event occurs or circumstances change, such as material deterioration in performance or a significant number of store closures, that would indicate an impairment may exist. Goodwill is tested for impairment at a level of reporting referred to as a reporting unit. Management determined that the Company has one reporting unit. When evaluating goodwill for impairment, the Company may first perform a qualitative assessment to determine whether it is more likely than not that a reporting unit is impaired. If the Company does not perform a qualitative assessment or determines that it is not more likely than not that the fair value of the reporting unit exceeds its carrying amount, a quantitative assessment is performed to calculate the estimated fair value of the reporting unit. If the carrying amount of the reporting unit exceeds the estimated fair value, an impairment charge is recorded to reduce the carrying value to the estimated fair value. The Company performed a qualitative assessment at March 31, 2022 based on the best judgment of management for the future of the reporting unit and on information known at the time of the assessment, and determined that it was more likely than not that the fair value of its reporting unit exceeded the carrying amount and, therefore, goodwill was not impaired. CONVERTIBLE NOTES PAYABLE The Company analyzes its convertible debt instruments for embedded attributes that may require bifurcation from the host and accounting as derivatives. At the inception of each instrument, the Company performs an analysis of the embedded features requiring bifurcation and may elect, if eligible, to account for the entire instrument at fair value. If the fair value option were to be elected, any changes in fair value would be recognized in the accompanying condensed consolidated statements of operations until the instrument is settled. The Company elected to account for its convertible note payable issued in August 2021 in connection with the Pie Squared Holdings acquisition (see Note 7) at fair value and, as such, has recognized the change in fair value in the condensed consolidated statement of operations and comprehensive loss for the three months ended March 31, 2022. For the convertible notes payable issued in March 2022, the Company performed an analysis of embedded features and did not identify any features that require bifurcation. However, as those convertible notes payable were issued with warrants, the net proceeds received were allocated to the convertible notes payable and the warrants based on their relative fair values at the issuance date. CONTRACT LIABILITIES Contract liabilities consist of deferred revenue resulting from initial and renewal franchise license fees paid by franchisees, which are generally recognized on a straight-line basis over the term of the underlying franchise agreement, as well as upfront development fees paid by franchisees, which are generally recognized on a straight-line basis over the term of the underlying franchise agreement once it is executed. The recognition of initial and renewal license fees is accelerated if the franchise or development agreement is terminated. During the three months ended March 31, 2022, the Company recognized $0.7 million of franchise income as a result of the cancellation of its international Master Franchise Agreement. There were no franchise or development agreement terminations during the three months ended March 31, 2021. FOREIGN CURRENCY TRANSLATION Assets and liabilities denominated in local currency are translated to U.S. dollars using the exchange rates as in effect at the balance sheet date. Results of operations are translated using average exchange rates prevailing throughout the period. Adjustments resulting from the process of translating foreign currency financial statements from functional currency into U.S. dollars are included in accumulated other comprehensive loss within stockholders’ equity. Foreign currency transaction gains and losses are included in current earnings. The Company has determined that local currency is the functional currency for its foreign operations. The foreign subsidiary was sold in 2021 and there are no foreign assets held at March 31, 2022 or December 31, 2021. LEASES We determine if a contract contains a lease at inception. Our material operating leases consist of restaurant locations. Our leases generally have remaining terms of 1 20 include options to extend the leases for additional 5-year periods. 20 Operating lease assets and liabilities are recognized at the lease commencement date. Operating lease liabilities represent the present value of lease payments not yet paid. Operating lease assets represent our right to use an underlying asset and are based upon the operating lease liabilities adjusted for prepayments or accrued lease payments, initial direct costs, lease incentives, and impairment of operating lease assets. To determine the present value of lease payments not yet paid, we estimate incremental borrowing rates corresponding to the reasonably certain lease term. We estimated this rate based on prevailing financial market conditions, comparable company and credit analysis, and management judgment. If the estimate of our incremental borrowing rate was changed, our operating lease assets and liabilities could differ materially. Assumptions made at the lease commencement date are re-evaluated upon the occurrence of certain events, such as a change in the likelihood that the Company will exercise a renewal option or a change in the estimated use of a lease incentive. Changes in assumptions are accounted for as lease modifications, and operating lease assets and liabilities are remeasured at the modification date. EMPLOYEE RETENTION CREDIT The Employee Retention Credit (“ERC”) under the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) is a refundable tax credit which encouraged businesses to keep employees on the payroll during the COVID-19 pandemic. The program ended on January 1, 2022. Approximately $ 0.1 0.8 RESTAURANT REVITALIZATION FUND The American Rescue Plan Act established the Restaurant Revitalization Fund (“RRF”) to provide funding to help restaurants and other eligible businesses keep their doors open. This program provided restaurants with funding equal to their pandemic-related revenue loss up to $10.0 million per business and no more than $5.0 million per physical location. 10.0 2.0 0.5 The Company periodically submits to the escrow agent for the acquisition the planned uses of these funds, and the sellers have the right to review the planned uses to determine whether, in the sellers’ opinion, the planned uses meet the criteria of “eligible uses” under the RRF. If determined to not meet such criteria, then the escrow agent will not distribute that portion of the request. Any unused funds on March 11, 2023, or if applicable, the awardee permanently closed before using all funds on authorized purposes, are repayable to the U.S. SBA. As the Company acquired all the outstanding membership interests in Pie Squared Holdings, the Company is now responsible that the grant proceeds were, in fact, properly obtained and disbursed for “eligible uses.” If it is determined that Pie Squared Holdings obtained the grant improperly or that disbursements of such grant monies were not “eligible uses,” then the Company would be responsible for the ramifications of such actions, including repayment of the approximately $ 10.0 SHARE-BASED COMPENSATION The Company measures and recognizes share-based compensation expense for both employee and nonemployee awards based on the grant date fair value of the awards. The Company recognizes share-based compensation expense on a straight-line basis over the requisite service period of the awards, which is generally the vesting period. The Company recognizes forfeitures as they occur. The Company estimates the fair value of employee and non-employee stock awards as of the date of grant using the Black-Scholes option pricing model. Management estimates the expected share price volatility based on the historical volatility of the Company. The expected term of the Company’s stock awards has been determined utilizing the “simplified” method for awards that qualify as “plain-vanilla” stock awards. The risk-free interest rate is determined by reference to the yield curve of a zero-coupon U.S. Treasury bond on the date of grant of the award for time periods approximately equal to the expected term of the award. Expected dividend yield is zero based on the fact that the Company has never paid cash dividends on common stock and does not expect to pay any cash dividends in the foreseeable future. INCOME TAXES Deferred income taxes are provided on the liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The Company has provided a valuation allowance for the full amount of the deferred tax assets in the accompanying condensed consolidated financial statements. As of March 31, 2022 and December 31, 2021, the Company had no accrued interest or penalties relating to any income tax obligations. The Company currently has no federal or state examinations in progress, nor has it had any federal or state tax examinations since its inception. The last three years of the Company’s tax years are subject to federal and state tax examination. LOSS PER COMMON SHARE The Company computes net loss per share using the weighted-average number of common shares outstanding during the period. Basic and diluted net loss per share are the same because the conversion, exercise or issuance of all potential common stock equivalents, which comprise the entire amount of the Company’s outstanding warrants, as described in Note 9, the potential conversion of the convertible debt, as described in Note 7, and share-based compensation awards, as described in Note 9, would be anti-dilutive. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS In May 2021, the FASB issued ASU 2021-04, Earnings per Share (Topic 260), Debt – Modifications and Extinguishments (Subtopic 470-50), Compensation – Stock Compensation (Topic 718), and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges or Freestanding Equity-Classified Written Call Options In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic ASC 832): Disclosures by Business Entities about Government Assistance We reviewed all other recently issued accounting pronouncements and concluded that they were either not applicable or not expected to have a significant impact to the condensed consolidated financial statements. |
FAIR VALUE OF FINANCIAL INSTRUM
FAIR VALUE OF FINANCIAL INSTRUMENTS | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | 3. FAIR VALUE OF FINANCIAL INSTRUMENTS The reconciliation of the convertible note payable issued in connection with the acquisition of Pie Squared Holdings measured at fair value on a recurring basis using significant unobservable inputs (Level 3) is as follows: SCHEDULE OF FAIR VALUE LIABILITIES MEASURED ON RECURRING BASIS (in thousands) Three months Balance at January 1, 2022 $ 1,099 Change in fair value (116 ) Balance at March 31, 2022 $ 983 The Company evaluated the convertible note payable in accordance with ASC Topic 815, Derivatives and Hedging SCHEDULE OF ESTIMATED FAIR VALUE ASSUMPTIONS Volatility 90.00 % Risk free rate 0.35 1.90 % Stock price $ 0.37 Credit spread 25.43 % |
INVESTMENTS
INVESTMENTS | 3 Months Ended |
Mar. 31, 2022 | |
Investments, All Other Investments [Abstract] | |
INVESTMENTS | 4. INVESTMENTS Investments consist of the following: SCHEDULE OF INVESTMENT (in thousands) March 31, 2022 December 31, 2021 Common stock of Sonnet, at fair value (a) $ 46 $ 50 Chanticleer Investors, LLC, at cost (b) 16 16 Total $ 62 $ 66 (a) Represents the fair value of the common stock of Sonnet held by the Company after its exercise of warrants received in connection with the Merger. As of March 31, 2022, 122,064 (b) Represents the Company’s investment in Chanticleer Investors, LLC, which holds an interest in Hooters of America, the operator and franchisor of the Hooters Brand worldwide. As of the dates presented, the Company’s effective economic interest in Hooters of America was less than 1%. 0.1 |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 3 Months Ended |
Mar. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT, NET | 5. PROPERTY AND EQUIPMENT, NET Property and equipment, net consists of the following: SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT (in thousands) March 31, 2022 December 31, 2021 Leasehold improvements $ 5,535 $ 5,511 Restaurant furniture and equipment 2,768 2,768 Construction in progress 41 20 Office and computer equipment 37 33 Office furniture and fixtures 63 57 Property,plant and equipment, gross 8,444 8,389 Accumulated depreciation and amortization (5,403 ) (5,274 ) Property, plant and equipment, net $ 3,041 $ 3,115 As of March 31, 2021, we performed an analysis of the recoverability of the carrying value of our property and equipment. Based on the analysis, an impairment charge of approximately $ 0.3 Depreciation expense was $ 0.1 |
INTANGIBLE ASSETS, NET
INTANGIBLE ASSETS, NET | 3 Months Ended |
Mar. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS, NET | 6. INTANGIBLE ASSETS, NET GOODWILL A rollforward of goodwill is as follows: SCHEDULE OF GOODWILL (in thousands) Three Months Ended Year Ended December 31, 2021 Beginning balance $ 7,810 $ 8,591 Acquisition of Pie Squared Holdings — 51 Sale of Hooters UK — (820 ) Foreign currency translation loss — (12 ) Ending balance $ 7,810 $ 7,810 OTHER INTANGIBLE ASSETS Franchise and trademark/tradename intangible assets consist of the following: SCHEDULE OF FINITE - LIVED INTANGIBLE ASSETS (in thousands) March 31, 2022 December 31, 2021 Trademark, Tradenames: American Roadside Burger 10 $ 561 $ 561 BGR: The Burger Joint Indefinite 739 739 Little Big Burger Indefinite 1,550 1,550 PizzaRev 5 410 410 3,260 3,260 Acquired Franchise Rights: BGR: The Burger Joint 7 828 828 PizzaRev 5 410 410 1,238 1,238 Total intangibles at cost 4,498 4,498 Accumulated amortization (1,460 ) (1,369 ) Intangible assets, net $ 3,038 $ 3,129 As of March 31, 2021, we performed an analysis of the recoverability of the carrying value of our intangible assets. Based on the analysis, an impairment charge of approximately $ 0.3 Amortization of intangible assets was $ 0.1 million for each of the three months ended March 31, 2022 and 2021. Amortization expense for the next five years is as follows (in thousands): SCHEDULE OF AMORTIZATION OF INTANGIBLE ASSETS Year ending December 31: 2022 (remaining nine months) $ 147 2023 164 2024 164 2025 164 2026 110 Amortization, net $ 749 |
LONG-TERM DEBT AND NOTES PAYABL
LONG-TERM DEBT AND NOTES PAYABLE | 3 Months Ended |
Mar. 31, 2022 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT AND NOTES PAYABLE | 7. LONG-TERM DEBT AND NOTES PAYABLE Long-term debt and notes payable are summarized as follows: SCHEDULE OF DEBT AND NOTES PAYABLE (in thousands) March 31, 2022 December 31, 2021 10% convertible debt (a) $ 4,038 $ 4,038 10 $ 4,038 $ 4,038 8 1,350 — Convertible promissory note (measured at fair value) (c) 983 1,099 PPP loans (d) 4,109 4,109 EIDL loans (e) 300 300 Contractor note (f) 348 348 Notes payable (g) 256 — Total Debt 11,384 9,894 Less: discount on convertible debt (a), (b) (293 ) (37 ) Total Debt, net of discount $ 11,091 $ 9,857 Current portion of long-term debt and notes payable $ 3,651 $ 3,264 Long-term debt and notes payable, less current portion $ 7,440 $ 6,593 (a) In connection with and prior to the Spin-Off and Merger, on April 1, 2020, pursuant to an agreement among Chanticleer, Oz Rey, LLC (“Oz Rey”) and certain original holders of the 8% non-convertible debentures that were satisfied during 2020, the Company issued a 10% secured convertible debenture (the “10% Convertible Debt”) to Oz Rey in exchange for the 8% non-convertible debentures. The principal amount of the 10% Convertible Debt is $4.0 million and payable in full on April 1, 2022, subject to extension by the holders in two-year intervals for up to 10 years from the issuance date upon Amergent meeting certain conditions 2,925,200 0.125 2,462,600 0.50 462,500 10 The 10% Convertible Debt was previously amended to fix the conversion rate into common stock at $ 0.10 2.4 10% 23,500,000 The Company recorded a debt discount of approximately $ 0.4 37,000 45,000 In connection with the 8% Convertible Debt transaction described in (b) below, the maturity date of the 10% Convertible Debt was extended to April 1, 2024 and Oz Rey agreed to subordinate payment of its 10% Convertible Debt to payment of the 8% Convertible Debt, which has been accounted for as a loan modification. In addition, Oz Rey received a fee equal to 2.0% of the principal amount of the 8% Convertible Debt issued in the transaction, totaling $ 27,000 (b) In March 2022, the Company commenced a private placement of up to $ 3.0 3,000,000 common stock warrants. Pursuant to the Securities Purchase Agreement, the Company issued $ 1.35 The 8% Convertible Debt matures 18 months after issuance and is subject to acceleration in the event of customary events of default. Interest is payable quarterly in cash. The 8% Convertible Debt may be converted by the holders at any time at a fixed conversion price of $ 0.40 per share, and each warrant entitles the holder to purchase one share of common stock at an exercise price of $ 0.50 five years from the issuance date. If the Company makes any distribution to the common stockholders, the holders of the warrants will be entitled to participate on an as-if-exercised basis. As of March 31, 2022, the 8% Convertible Debt was convertible into 3,375,000 The net proceeds from the issuance were allocated to the 8% Convertible Debt and the warrants based on their relative fair values, resulting in an allocation of $ 1.0 million to the 8% Convertible Debt and $ 0.3 million to the warrants (see Note 9). The Company recorded a debt discount of approximately $ 0.3 million for the difference between the face value of the 8% Convertible Debt and the amount allocated to the debt at the issuance date and is amortizing this discount over the 18 -month term of the related debt. Amortization of approximately $ 6,000 was recorded as interest expense during the three months ended March 31, 2022. (c) On August 30, 2021, the Company purchased all of the outstanding membership interests in Pie Squared Holdings. The purchase price was funded through the issuance of an 8% secured, convertible promissory note with a face value of $ 1.0 million and a fair value of $ 1.2 million at the acquisition date. 0.50 2.00 2,000,000 Interest on the convertible promissory note is due quarterly and $ 0.5 (d) On April 27, 2020, Amergent received a Paycheck Protection Program (“PPP”) loan in the amount of approximately $ 2.1 1 0.1 On February 25, 2021, the Company received a second PPP loan in the amount of $ 2.0 1 February 25, 2026 45,000 (e) On August 4, 2020, the Company obtained two loans under the Economic Injury Disaster Loan (“EIDL”) assistance program from the U.S. SBA in light of the impact of the COVID-19 pandemic on the Company’s business. The principal amount of the loans is $ 0.3 3.75 1,462 (f) The Company entered into a promissory note to repay a contractor for the build-out of a new Little Big Burger location. The note bears interest at 12 0.4 0.1 (g) In February and March 2022, eight company-owned stores entered into notes payable to Toast Capital Loans. The terms of the notes require payment of 13.2 270 15 The Company’s various loan agreements contain financial and non-financial covenants and provisions providing for cross-default. The evaluation of compliance with these provisions is subject to interpretation and the exercise of judgment. Oz Rey has provided a waiver of certain financial covenants through April 30, 2023. Future minimum payments are as follows (in thousands): SCHEDULE OF FUTURE MINIMUM PAYMENTS Year ending December 31: 2022 (remaining nine months) $ 3,520 2023 2,383 2024 4,579 2025 547 2026 98 Thereafter 274 Less: discount on convertible debt (293 ) Less: fair value adjustment (17 ) Debt 11,091 Less: current maturities of long-term debt and notes payable (3,651 ) Long-term debt and notes payable $ 7,440 |
ACCOUNTS PAYABLE AND ACCRUED EX
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | 3 Months Ended |
Mar. 31, 2022 | |
Payables and Accruals [Abstract] | |
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | 8 ACCOUNTS PAYABLE AND ACCRUED EXPENSES Accounts payable and accrued expenses are summarized as follows: SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES (in thousands) March 31, 2022 December 31, 2021 Accounts payable $ 2,357 $ 2,544 Accrued expenses 2,130 1,955 Accrued taxes (VAT, sales, payroll, etc.) 2,080 2,149 Accrued interest 232 196 Accounts payable and accrued expenses, total $ 6,799 $ 6,844 As of March 31, 2022 and December 31, 2021, approximately $ 1.9 2.0 0.8 |
STOCKHOLDER_S EQUITY
STOCKHOLDER’S EQUITY | 3 Months Ended |
Mar. 31, 2022 | |
Equity [Abstract] | |
STOCKHOLDER’S EQUITY | 9. STOCKHOLDER’S EQUITY 2020 bridge financing Pursuant to a Securities Purchase Agreement dated February 7, 2020, the Company sold 1,500 1.5 0.1 5 350,000 1.25 1,000 0.5 0.7 713 1,426,849 the shareholders of Chanticleer common stock received shares of Amergent on a 1 for 1 basis (spin-off shares) and received 1 share of Sonnet common stock for 26 shares of Chanticleer common stock held at the time of the Merger On August 17, 2020, the Company and the holders of the Series 2 Preferred entered into a Waiver, Consent, and Amendment to the Certificate of Designations (the “Extension Agreement”) which included provisions for an extension of the True-Up Payment discussed below from August 7, 2020 to December 10, 2020, and permitted the shares of Amergent obtained by the investor in the Spin-Off to be included in the determination of the True-Up Payment discussed below, with the Company paying all expenses incurred by the institutional investor in connection with the Extension Agreement and certain consideration for the institutional investor’s willingness to extend the date of the True-Up Payment. The consideration included $ 66,000 134,000 28,060 On February 16, 2021, the Company and the holders of the Series 2 Preferred entered into a Waiver, Consent and Amendment to the Certificate of Designations (the “Waiver”). Pursuant to the Waiver, the Company filed the Second Amendment and Restated Certificate of Designations of Series 2 Convertible Preferred Stock (“Amended COD”) with the Delaware Secretary of State (i) providing for the extension of the True-Up Payment to April 1, 2021, (ii) providing for the deduction of proceeds to the original holders from sales of Series 2 Preferred for the True-Up Payment, and (iii) providing for a reduction in amount of cash subject to restriction as discussed below from $ 1.3 0.9 During the year ended December 31, 2021, the investors converted 637 1,274,000 150 50 100,000 100 The Series 2 Preferred is classified in the accompanying condensed consolidated balance sheets as temporary equity due to certain contingent redemption features which are outside the control of the Company. Designations, rights and preferences of Series 2 Preferred: Stated value: 1,000 True-Up Payment: 125 0.1 0.2 The Company determined that the True-Up Payment constituted a “make-whole” provision as defined by U.S. GAAP that was required to be settled in cash and, as such, was bifurcated from the host instrument, the Series 2 Preferred. It was accounted for as a derivative liability prior to settlement, with changes in fair value recorded in change in fair value of derivative liabilities in the condensed consolidated statement of operations for the three months ended March 31, 2021. Redemption Conversion at option of holder/ beneficial ownership limitation: 1.00 0.50 4.99 9.99 Forced conversion: 1,400 Liquidation preference: Voting rights: Triggering events: Anti-dilution: Warrants At March 31, 2022, the outstanding warrants consisted of the following: SCHEDULE OF OUTSTANDING WARRANTS Date Issued Number of Warrants Exercise Price Expiration Date April 1, 2020 2,462,600 $ 0.125 April 1, 2030 April 1, 2020 462,600 $ 0.500 April 1, 2030 March 30, 2020 350,000 $ 1.250 March 30, 2025 August 17, 2020 134,000 $ 1.250 August 17, 2025 March 15, 2022 250,000 $ 0.500 March 15, 2027 March 21, 2022 250,000 $ 0.500 March 21, 2027 March 22, 2022 250,000 $ 0.500 March 22, 2027 March 24, 2022 600,000 $ 0.500 March 24, 2027 4,759,200 A summary of the warrant activity during the three months ended March 31, 2022 is presented below: SUMMARY OF WARRANTS ACTIVITY Number of Warrants Weighted Weighted Outstanding at January 1, 2022 3,409,200 $ 0.34 7.6 Granted 1,350,000 $ 0.50 5.0 Exercised — $ — — Forfeited/Other Adjustments — $ — — Outstanding at March 31, 2022 4,759,200 $ 0.38 6.6 Exercisable at March 31, 2022 4,759,200 $ 0.38 6.6 As discussed in Note 7, 1,350,000 warrants were granted in March 2022 in connection with the issuance of 8% Convertible Debt and are equity-classified in the condensed consolidated financial statements. The net proceeds from the issuance were allocated to the 8% Convertible Debt and the warrants based on their relative fair values at the issuance date, resulting in an allocation of approximately $0.3 million to the warrants. Assumptions used in calculating the fair value of the warrants at the issuance date include the following: SUMMARY OF CHANGES IN FAIR VALUE WARRANTS Stock price per share $ 0.37 0.40 Term 5.0 Expected volatility 90.00 % Divided yield — Risk-free interest rate 2.10 2.39 % Options In August 2021, the Company adopted the 2021 Inducement Plan (“the Plan”). Under the 2021 Inducement Plan, the Company can grant stock options and stock awards. There are 500,000 50,000 In November 2021, the Company adopted the 2021 Equity Incentive Plan (the “Incentive Plan”). Under the 2021 Incentive Plan, the Company can grant stock options and stock awards. The stockholders of the Company approved the Incentive Plan on December 30, 2021. There are 2,000,000 2,000,000 Share-based awards generally vest over a period of three years five years The Company recorded share-based compensation expense of approximately $ 6,000 The following table summarizes the share-based awards as of March 31, 2022: SCHEDULE OF SHARE BASED AWARDS Number of Options Weighted Weighted Outstanding at March 31, 2022 450,000 $ 1.38 4.3 Exercisable at March 31, 2022 175,000 $ 2.22 4.3 There were no options granted, exercised or forfeited during the three months ended March 31, 2022. As of March 31, 2022, the unrecognized compensation cost related to outstanding share-based awards was approximately $ 43,000 1.5 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 10. COMMITMENTS AND CONTINGENCIES Legal proceedings Indemnification agreement and tail policy On March 25, 2020, pursuant to the requirements of the Merger Agreement, Chanticleer, Sonnet and Amergent entered into an indemnification agreement (“Indemnification Agreement”) providing that Amergent will fully indemnify and hold harmless each of Chanticleer and Sonnet, and each of their respective directors, officers, stockholders and managers who assumes such role upon or following the closing of the Merger against all actual or threatened claims, losses, liabilities, damages, judgments, fines and reasonable fees, costs and expenses, including attorneys’ fees and disbursements, incurred in connection with any claim, action, suit, proceeding or investigation, whether civil, administrative, investigative or otherwise, related to the Spin-Off business prior to or in connection with its disposition to Amergent. The Indemnification Agreement will expire on March 25, 2026. In addition, pursuant to Merger Agreement, prior to closing of the Merger, the Spin-Off entity acquired a tail insurance policy in a coverage amount of $ 3.0 Litigation related to leased properties During 2021 and the three months ended March 31, 2022, the Company was in arrears on rent due on several of its leases as a result of the COVID-19 pandemic. As a result, the Company has pending litigation related to seven sites of which four have permanently closed. The outcome of this litigation could result in the permanent closure of additional restaurant locations as well as the possibility of the Company being required to pay interest and damages, modify certain leases on unfavorable terms and could result in material impairments to the Company’s assets. See leases No amounts have been accrued as of March 31, 2022 or December 31, 2021 in the accompanying condensed consolidated balance sheets as management does not believe the outcome will result in additional liabilities to the Company; however, there can be no guarantees. From time to time, the Company may be involved in other legal proceedings and claims that have arisen in the ordinary course of business are generally covered by insurance. As of March 31, 2022, the Company does not expect the amount of ultimate liability with respect to these matters to be material to the Company’s financial condition, results of operations or cash flows. Leases The Company’s leases typically contain rent escalations over the lease terms. The Company recognizes expense for these leases on a straight-line basis over the lease terms. Additionally, tenant incentives used to fund leasehold improvements are recognized when earned and reduce our right-of-use asset related to the leases. These incentives are amortized through the right-of-use asset as reductions of expense over the lease terms. Some of the Company’s leases include rent escalations based on inflation indexes and fair market value adjustments. Certain leases contain contingent rental provisions that include a fixed base rent plus an additional percentage of the restaurant’s sales in excess of stipulated amounts. Operating lease liabilities are calculated using the prevailing index or rate at lease commencement. Subsequent escalations in the index or rate and contingent rental payments are recognized as variable lease expenses. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. As part of the lease agreements, the Company is also responsible for payments regarding non-lease components (common area maintenance, operating expenses, etc.) and percentage rent payments based on monthly or annual restaurant sales amounts which are considered variable costs and are not included as part of the lease liabilities. Related to the adoption of Leases Topic 842, our policy elections were as follows: Short-term policy The Company has elected the short-term lease recognition exemption for all applicable classes of underlying assets. Leases with an initial term of 12 months or less, that do not include an option to purchase the underlying asset that the Company is reasonably certain to exercise, are not recorded on the balance sheet. Supplemental balance sheet information related to leases was as follows (in thousands): SCHEDULE OF OPERATING LEASE INFORMATION Operating Leases Classification March 31, 2022 December 31, 2021 Right-of-use assets Operating lease assets $ 8,336 $ 8,021 Current lease liabilities Current operating lease liabilities 4,425 4,599 Non-current lease liabilities Long-term operating lease liabilities 8,897 8,644 $ 13,322 $ 13,243 Lease term and discount rate were as follows: March 31, 2022 December 31, 2021 Weighted average remaining lease term (years) 6.5 6.7 Weighted average discount rate 7.8 % 8.1 % As of March 31, 2021, we performed an analysis of the recoverability of our right-of-use assets. Based on the analysis, an impairment charge of approximately $ 0.7 During the three months ended March 31, 2022, no lease liabilities were derecognized. During the three months ended March 31, 2021, approximately $ 43,000 2.5 During the three months ended March 31, 2022, the Company amended certain leases and changed its assumptions regarding the exercise of a renewal option, which have been accounted for as lease modifications. The operating lease assets and liabilities were remeasured at the modification dates, resulting in an increase of $ 0.6 Rent expense of approximately $ 0.5 13,000 0.6 0.1 PPP loan The Company received two PPP loans totaling $ 4.1 Presently, the U.S. SBA and other governmental communications have indicated that all loans in excess of $ 2.0 RRF As discussed in Note 2, Pie Squared Holdings received an approximately $ 10.0 10.0 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 11. SUBSEQUENT EVENTS The Company has evaluated subsequent events from the balance sheet date through the date at which the condensed consolidated financial statements were available to be issued, and there are no items requiring disclosure. |
RESTATEMENT OF PREVIOUSLY ISSUE
RESTATEMENT OF PREVIOUSLY ISSUED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) | 3 Months Ended |
Mar. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
RESTATEMENT OF PREVIOUSLY ISSUED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) | 12. RESTATEMENT OF PREVIOUSLY ISSUED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) The Company, while undergoing the audit of its consolidated financial statements as of December 31, 2021 and for the year then ended, determined that it had over-depreciated certain assets. This impacted the previously reported amounts for property and equipment and depreciation and amortization, among other line items, in the condensed consolidated interim financial statements. The following table sets forth the effects of the adjustment on affected items within the Company’s previously reported Condensed Consolidated Balance Sheet: SCHEDULE OF PREVIOUSLY ISSUED INTERIM FINANCIAL STATEMENTS (in thousands) As reported Adjustment As restated March 31, 2021 (in thousands) As reported Adjustment As restated Property and equipment, net $ 3,172 $ 136 $ 3,308 Accumulated deficit $ (97,136 ) $ 136 $ (97,000 ) The following table sets forth the effects of the adjustment on affected items within the Company’s previously reported Condensed Consolidated Statement of Operations: As reported Adjustment As restated Three months ended March 31, 2021 As reported Adjustment As restated Depreciation and amortization $ 368 $ (136 ) $ 232 Operating (loss) income $ (2,790 ) $ 136 $ (2,654 ) Consolidated net (loss) income $ (2,713 ) $ 136 $ (2,577 ) Net (loss) income attributable to Amergent Hospitality Group Inc. $ (2,548 ) $ 136 $ (2,412 ) Net (loss) income attributable to Amergent Hospitality Group Inc. per common share, basic and diluted $ (0.18 ) $ 0.01 $ (0.17 ) |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
BASIS OF PRESENTATION | BASIS OF PRESENTATION The accompanying condensed consolidated financial statements have been prepared in conformity with U.S. GAAP. Any reference in these notes to applicable guidance is meant to refer to U.S. GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) promulgated by the Financial Accounting Standards Board (“FASB”). Certain prior year amounts have been updated to conform to the current period presentation. The Company has opted to present the financial information on the condensed consolidated balance sheets and condensed consolidated statements of operations, comprehensive loss, stockholders’ deficit and cash flows in thousands. |
USE OF ESTIMATES | USE OF ESTIMATES The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Significant estimates include valuing options, warrants and convertible notes payable using Black-Scholes and Monte Carlo models, and analysis of the recoverability of goodwill and long-lived assets. Actual results could differ from those estimates, particularly given the significant social and economic disruptions and uncertainties associated with the ongoing COVID-19 pandemic and the COVID-19 control responses. |
FAIR VALUE OF FINANCIAL INSTRUMENTS | FAIR VALUE OF FINANCIAL INSTRUMENTS The Company measures and records certain financial assets and liabilities at fair value on a recurring basis. U.S. GAAP provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority, referred to as Level 1, to quoted prices in active markets for identical assets and liabilities. The next priority, referred to as Level 2, is given to quoted prices for similar assets or liabilities in active markets or quoted prices for identical or similar assets or liabilities in markets that are not active; that is, markets in which there are few transactions for the asset or liability. The lowest priority, referred to as Level 3, is given to unobservable inputs. The table below reflects the level of the inputs used in the Company’s fair value calculations: SCHEDULE OF FAIR VALUE MEASUREMENTS, RECURRING AND NONRECURRING (in thousands) Quoted Prices in Active Markets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Fair Value March 31, 2022 Assets (Note 4) Common stock of Sonnet $ 46 $ — $ — $ 46 Liabilities (Note 3) Convertible note payable $ — $ — $ 983 $ 983 (in thousands) Quoted Prices in Active Markets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Fair Value December 31, 2021 Assets (Note 4) Common stock of Sonnet $ 50 $ — $ — $ 50 Common stock of Sonnet $ 50 $ — $ — $ 50 Liabilities (Note 3) Convertible note payable $ — $ — $ 1,099 $ 1,099 Convertible note payable $ — $ — $ 1,099 $ 1,099 Inputs used in the Company’s Level 3 calculation of fair value for the convertible note payable are discussed in Note 3. The Company is required to disclose fair value information about financial instruments when it is practicable to estimate that value. The carrying amounts of the Company’s cash, restricted cash, accounts receivable, other receivables, accounts payable, other current liabilities, convertible notes payable (other than the convertible note payable discussed above) and notes payable approximate fair value due to the short-term maturities of these financial instruments and/or because related interest rates offered to the Company approximate current rates. SEGMENTS Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company operates under four brands but views its operations and manages its business in one |
CASH | CASH Cash consists of deposits held at financial institutions and is stated at fair value. The Company limits its credit risk associated with cash by maintaining its bank accounts at major financial institutions. |
RESTRICTED CASH | RESTRICTED CASH As of March 31, 2022 and December 31, 2021, the Company maintained restricted cash of $ 0.6 1.7 restaurant revitalization fund For purposes of the condensed consolidated cash flow statements, the restricted cash is aggregated with cash of $ 2.5 2.4 3.1 3.2 |
PROPERTY AND EQUIPMENT | PROPERTY AND EQUIPMENT Property and equipment are stated at cost, less accumulated depreciation. Depreciation and amortization are recorded generally using the straight-line method over the estimated useful lives of the respective assets. Leasehold improvements are amortized over the lesser of the expected lease term or the estimated useful lives of the related assets using the straight-line method. Maintenance and repairs that do not improve or extend the useful lives of the assets are not considered assets and are charged to expense when incurred. The estimated useful lives used to compute depreciation and amortization are as follows: SCHEDULE OF PROPERTY AND EQUIPMENT USEFUL LIVES Leasehold improvements 5 15 Restaurant furnishings and equipment 3 10 Furniture and fixtures 3 10 Office and computer equipment 3 7 |
INTANGIBLE ASSETS | INTANGIBLE ASSETS Trademark/Tradenames Certain of the Company’s trademark/tradenames have been determined to have a definite life and are being amortized on a straight-line basis over estimated useful lives of 3 10 long-lived assets |
LONG-LIVED ASSETS | LONG-LIVED ASSETS Long-lived assets, such as property and equipment, operating lease assets, and purchased intangible assets subject to depreciation and amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Some of the events or changes in circumstances that would trigger an impairment test include, but are not limited to: ● significant under-performance relative to expected and/or historical results (negative comparable sales growth or operating cash flows for two consecutive years); ● significant negative industry or economic trends; ● knowledge of transactions involving the sale of similar property at amounts below the Company’s carrying value; or ● the Company’s expectation to dispose of long-lived assets before the end of their estimated useful lives, even though the assets do not meet the criteria to be classified as “Held for Sale.” If circumstances require a long-lived asset or asset group be tested for possible impairment, the Company first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying value. If the carrying value of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying value exceeds its fair value. Fair value is determined through various valuation techniques, including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. During 2021, the Company determined that events occurred, some of which were related to the COVID-19 pandemic, requiring management to review certain long-lived assets for impairment. Refer to Notes 5, 6 and 10 for further discussion. There were no such indicators of impairment of long-lived assets during the three months ended March 31, 2022. |
GOODWILL | GOODWILL Goodwill, which is not subject to amortization, is evaluated for impairment annually as of the end of the Company’s year-end, or more frequently if an event occurs or circumstances change, such as material deterioration in performance or a significant number of store closures, that would indicate an impairment may exist. Goodwill is tested for impairment at a level of reporting referred to as a reporting unit. Management determined that the Company has one reporting unit. When evaluating goodwill for impairment, the Company may first perform a qualitative assessment to determine whether it is more likely than not that a reporting unit is impaired. If the Company does not perform a qualitative assessment or determines that it is not more likely than not that the fair value of the reporting unit exceeds its carrying amount, a quantitative assessment is performed to calculate the estimated fair value of the reporting unit. If the carrying amount of the reporting unit exceeds the estimated fair value, an impairment charge is recorded to reduce the carrying value to the estimated fair value. The Company performed a qualitative assessment at March 31, 2022 based on the best judgment of management for the future of the reporting unit and on information known at the time of the assessment, and determined that it was more likely than not that the fair value of its reporting unit exceeded the carrying amount and, therefore, goodwill was not impaired. |
CONVERTIBLE NOTES PAYABLE | CONVERTIBLE NOTES PAYABLE The Company analyzes its convertible debt instruments for embedded attributes that may require bifurcation from the host and accounting as derivatives. At the inception of each instrument, the Company performs an analysis of the embedded features requiring bifurcation and may elect, if eligible, to account for the entire instrument at fair value. If the fair value option were to be elected, any changes in fair value would be recognized in the accompanying condensed consolidated statements of operations until the instrument is settled. The Company elected to account for its convertible note payable issued in August 2021 in connection with the Pie Squared Holdings acquisition (see Note 7) at fair value and, as such, has recognized the change in fair value in the condensed consolidated statement of operations and comprehensive loss for the three months ended March 31, 2022. For the convertible notes payable issued in March 2022, the Company performed an analysis of embedded features and did not identify any features that require bifurcation. However, as those convertible notes payable were issued with warrants, the net proceeds received were allocated to the convertible notes payable and the warrants based on their relative fair values at the issuance date. CONTRACT LIABILITIES Contract liabilities consist of deferred revenue resulting from initial and renewal franchise license fees paid by franchisees, which are generally recognized on a straight-line basis over the term of the underlying franchise agreement, as well as upfront development fees paid by franchisees, which are generally recognized on a straight-line basis over the term of the underlying franchise agreement once it is executed. The recognition of initial and renewal license fees is accelerated if the franchise or development agreement is terminated. During the three months ended March 31, 2022, the Company recognized $0.7 million of franchise income as a result of the cancellation of its international Master Franchise Agreement. There were no franchise or development agreement terminations during the three months ended March 31, 2021. |
FOREIGN CURRENCY TRANSLATION | FOREIGN CURRENCY TRANSLATION Assets and liabilities denominated in local currency are translated to U.S. dollars using the exchange rates as in effect at the balance sheet date. Results of operations are translated using average exchange rates prevailing throughout the period. Adjustments resulting from the process of translating foreign currency financial statements from functional currency into U.S. dollars are included in accumulated other comprehensive loss within stockholders’ equity. Foreign currency transaction gains and losses are included in current earnings. The Company has determined that local currency is the functional currency for its foreign operations. The foreign subsidiary was sold in 2021 and there are no foreign assets held at March 31, 2022 or December 31, 2021. |
LEASES | LEASES We determine if a contract contains a lease at inception. Our material operating leases consist of restaurant locations. Our leases generally have remaining terms of 1 20 include options to extend the leases for additional 5-year periods. 20 Operating lease assets and liabilities are recognized at the lease commencement date. Operating lease liabilities represent the present value of lease payments not yet paid. Operating lease assets represent our right to use an underlying asset and are based upon the operating lease liabilities adjusted for prepayments or accrued lease payments, initial direct costs, lease incentives, and impairment of operating lease assets. To determine the present value of lease payments not yet paid, we estimate incremental borrowing rates corresponding to the reasonably certain lease term. We estimated this rate based on prevailing financial market conditions, comparable company and credit analysis, and management judgment. If the estimate of our incremental borrowing rate was changed, our operating lease assets and liabilities could differ materially. Assumptions made at the lease commencement date are re-evaluated upon the occurrence of certain events, such as a change in the likelihood that the Company will exercise a renewal option or a change in the estimated use of a lease incentive. Changes in assumptions are accounted for as lease modifications, and operating lease assets and liabilities are remeasured at the modification date. |
EMPLOYEE RETENTION CREDIT | EMPLOYEE RETENTION CREDIT The Employee Retention Credit (“ERC”) under the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) is a refundable tax credit which encouraged businesses to keep employees on the payroll during the COVID-19 pandemic. The program ended on January 1, 2022. Approximately $ 0.1 0.8 |
RESTAURANT REVITALIZATION FUND | RESTAURANT REVITALIZATION FUND The American Rescue Plan Act established the Restaurant Revitalization Fund (“RRF”) to provide funding to help restaurants and other eligible businesses keep their doors open. This program provided restaurants with funding equal to their pandemic-related revenue loss up to $10.0 million per business and no more than $5.0 million per physical location. 10.0 2.0 0.5 The Company periodically submits to the escrow agent for the acquisition the planned uses of these funds, and the sellers have the right to review the planned uses to determine whether, in the sellers’ opinion, the planned uses meet the criteria of “eligible uses” under the RRF. If determined to not meet such criteria, then the escrow agent will not distribute that portion of the request. Any unused funds on March 11, 2023, or if applicable, the awardee permanently closed before using all funds on authorized purposes, are repayable to the U.S. SBA. As the Company acquired all the outstanding membership interests in Pie Squared Holdings, the Company is now responsible that the grant proceeds were, in fact, properly obtained and disbursed for “eligible uses.” If it is determined that Pie Squared Holdings obtained the grant improperly or that disbursements of such grant monies were not “eligible uses,” then the Company would be responsible for the ramifications of such actions, including repayment of the approximately $ 10.0 |
SHARE-BASED COMPENSATION | SHARE-BASED COMPENSATION The Company measures and recognizes share-based compensation expense for both employee and nonemployee awards based on the grant date fair value of the awards. The Company recognizes share-based compensation expense on a straight-line basis over the requisite service period of the awards, which is generally the vesting period. The Company recognizes forfeitures as they occur. The Company estimates the fair value of employee and non-employee stock awards as of the date of grant using the Black-Scholes option pricing model. Management estimates the expected share price volatility based on the historical volatility of the Company. The expected term of the Company’s stock awards has been determined utilizing the “simplified” method for awards that qualify as “plain-vanilla” stock awards. The risk-free interest rate is determined by reference to the yield curve of a zero-coupon U.S. Treasury bond on the date of grant of the award for time periods approximately equal to the expected term of the award. Expected dividend yield is zero based on the fact that the Company has never paid cash dividends on common stock and does not expect to pay any cash dividends in the foreseeable future. |
INCOME TAXES | INCOME TAXES Deferred income taxes are provided on the liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The Company has provided a valuation allowance for the full amount of the deferred tax assets in the accompanying condensed consolidated financial statements. As of March 31, 2022 and December 31, 2021, the Company had no accrued interest or penalties relating to any income tax obligations. The Company currently has no federal or state examinations in progress, nor has it had any federal or state tax examinations since its inception. The last three years of the Company’s tax years are subject to federal and state tax examination. |
LOSS PER COMMON SHARE | LOSS PER COMMON SHARE The Company computes net loss per share using the weighted-average number of common shares outstanding during the period. Basic and diluted net loss per share are the same because the conversion, exercise or issuance of all potential common stock equivalents, which comprise the entire amount of the Company’s outstanding warrants, as described in Note 9, the potential conversion of the convertible debt, as described in Note 7, and share-based compensation awards, as described in Note 9, would be anti-dilutive. |
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS | RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS In May 2021, the FASB issued ASU 2021-04, Earnings per Share (Topic 260), Debt – Modifications and Extinguishments (Subtopic 470-50), Compensation – Stock Compensation (Topic 718), and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges or Freestanding Equity-Classified Written Call Options In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic ASC 832): Disclosures by Business Entities about Government Assistance We reviewed all other recently issued accounting pronouncements and concluded that they were either not applicable or not expected to have a significant impact to the condensed consolidated financial statements. |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
SCHEDULE OF FAIR VALUE MEASUREMENTS, RECURRING AND NONRECURRING | SCHEDULE OF FAIR VALUE MEASUREMENTS, RECURRING AND NONRECURRING (in thousands) Quoted Prices in Active Markets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Fair Value March 31, 2022 Assets (Note 4) Common stock of Sonnet $ 46 $ — $ — $ 46 Liabilities (Note 3) Convertible note payable $ — $ — $ 983 $ 983 (in thousands) Quoted Prices in Active Markets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Fair Value December 31, 2021 Assets (Note 4) Common stock of Sonnet $ 50 $ — $ — $ 50 Common stock of Sonnet $ 50 $ — $ — $ 50 Liabilities (Note 3) Convertible note payable $ — $ — $ 1,099 $ 1,099 Convertible note payable $ — $ — $ 1,099 $ 1,099 |
SCHEDULE OF PROPERTY AND EQUIPMENT USEFUL LIVES | The estimated useful lives used to compute depreciation and amortization are as follows: SCHEDULE OF PROPERTY AND EQUIPMENT USEFUL LIVES Leasehold improvements 5 15 Restaurant furnishings and equipment 3 10 Furniture and fixtures 3 10 Office and computer equipment 3 7 |
FAIR VALUE OF FINANCIAL INSTR_2
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
SCHEDULE OF FAIR VALUE LIABILITIES MEASURED ON RECURRING BASIS | The reconciliation of the convertible note payable issued in connection with the acquisition of Pie Squared Holdings measured at fair value on a recurring basis using significant unobservable inputs (Level 3) is as follows: SCHEDULE OF FAIR VALUE LIABILITIES MEASURED ON RECURRING BASIS (in thousands) Three months Balance at January 1, 2022 $ 1,099 Change in fair value (116 ) Balance at March 31, 2022 $ 983 |
SCHEDULE OF ESTIMATED FAIR VALUE ASSUMPTIONS | SCHEDULE OF ESTIMATED FAIR VALUE ASSUMPTIONS Volatility 90.00 % Risk free rate 0.35 1.90 % Stock price $ 0.37 Credit spread 25.43 % |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Investments, All Other Investments [Abstract] | |
SCHEDULE OF INVESTMENT | Investments consist of the following: SCHEDULE OF INVESTMENT (in thousands) March 31, 2022 December 31, 2021 Common stock of Sonnet, at fair value (a) $ 46 $ 50 Chanticleer Investors, LLC, at cost (b) 16 16 Total $ 62 $ 66 (a) Represents the fair value of the common stock of Sonnet held by the Company after its exercise of warrants received in connection with the Merger. As of March 31, 2022, 122,064 (b) Represents the Company’s investment in Chanticleer Investors, LLC, which holds an interest in Hooters of America, the operator and franchisor of the Hooters Brand worldwide. As of the dates presented, the Company’s effective economic interest in Hooters of America was less than 1%. 0.1 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT | Property and equipment, net consists of the following: SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT (in thousands) March 31, 2022 December 31, 2021 Leasehold improvements $ 5,535 $ 5,511 Restaurant furniture and equipment 2,768 2,768 Construction in progress 41 20 Office and computer equipment 37 33 Office furniture and fixtures 63 57 Property,plant and equipment, gross 8,444 8,389 Accumulated depreciation and amortization (5,403 ) (5,274 ) Property, plant and equipment, net $ 3,041 $ 3,115 |
INTANGIBLE ASSETS, NET (Tables)
INTANGIBLE ASSETS, NET (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
SCHEDULE OF GOODWILL | A rollforward of goodwill is as follows: SCHEDULE OF GOODWILL (in thousands) Three Months Ended Year Ended December 31, 2021 Beginning balance $ 7,810 $ 8,591 Acquisition of Pie Squared Holdings — 51 Sale of Hooters UK — (820 ) Foreign currency translation loss — (12 ) Ending balance $ 7,810 $ 7,810 |
SCHEDULE OF FINITE - LIVED INTANGIBLE ASSETS | Franchise and trademark/tradename intangible assets consist of the following: SCHEDULE OF FINITE - LIVED INTANGIBLE ASSETS (in thousands) March 31, 2022 December 31, 2021 Trademark, Tradenames: American Roadside Burger 10 $ 561 $ 561 BGR: The Burger Joint Indefinite 739 739 Little Big Burger Indefinite 1,550 1,550 PizzaRev 5 410 410 3,260 3,260 Acquired Franchise Rights: BGR: The Burger Joint 7 828 828 PizzaRev 5 410 410 1,238 1,238 Total intangibles at cost 4,498 4,498 Accumulated amortization (1,460 ) (1,369 ) Intangible assets, net $ 3,038 $ 3,129 |
SCHEDULE OF AMORTIZATION OF INTANGIBLE ASSETS | Amortization of intangible assets was $ 0.1 million for each of the three months ended March 31, 2022 and 2021. Amortization expense for the next five years is as follows (in thousands): SCHEDULE OF AMORTIZATION OF INTANGIBLE ASSETS Year ending December 31: 2022 (remaining nine months) $ 147 2023 164 2024 164 2025 164 2026 110 Amortization, net $ 749 |
LONG-TERM DEBT AND NOTES PAYA_2
LONG-TERM DEBT AND NOTES PAYABLE (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Debt Disclosure [Abstract] | |
SCHEDULE OF DEBT AND NOTES PAYABLE | Long-term debt and notes payable are summarized as follows: SCHEDULE OF DEBT AND NOTES PAYABLE (in thousands) March 31, 2022 December 31, 2021 10% convertible debt (a) $ 4,038 $ 4,038 10 $ 4,038 $ 4,038 8 1,350 — Convertible promissory note (measured at fair value) (c) 983 1,099 PPP loans (d) 4,109 4,109 EIDL loans (e) 300 300 Contractor note (f) 348 348 Notes payable (g) 256 — Total Debt 11,384 9,894 Less: discount on convertible debt (a), (b) (293 ) (37 ) Total Debt, net of discount $ 11,091 $ 9,857 Current portion of long-term debt and notes payable $ 3,651 $ 3,264 Long-term debt and notes payable, less current portion $ 7,440 $ 6,593 |
SCHEDULE OF FUTURE MINIMUM PAYMENTS | Future minimum payments are as follows (in thousands): SCHEDULE OF FUTURE MINIMUM PAYMENTS Year ending December 31: 2022 (remaining nine months) $ 3,520 2023 2,383 2024 4,579 2025 547 2026 98 Thereafter 274 Less: discount on convertible debt (293 ) Less: fair value adjustment (17 ) Debt 11,091 Less: current maturities of long-term debt and notes payable (3,651 ) Long-term debt and notes payable $ 7,440 |
ACCOUNTS PAYABLE AND ACCRUED _2
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Payables and Accruals [Abstract] | |
SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES | Accounts payable and accrued expenses are summarized as follows: SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES (in thousands) March 31, 2022 December 31, 2021 Accounts payable $ 2,357 $ 2,544 Accrued expenses 2,130 1,955 Accrued taxes (VAT, sales, payroll, etc.) 2,080 2,149 Accrued interest 232 196 Accounts payable and accrued expenses, total $ 6,799 $ 6,844 |
STOCKHOLDER_S EQUITY (Tables)
STOCKHOLDER’S EQUITY (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Equity [Abstract] | |
SCHEDULE OF OUTSTANDING WARRANTS | At March 31, 2022, the outstanding warrants consisted of the following: SCHEDULE OF OUTSTANDING WARRANTS Date Issued Number of Warrants Exercise Price Expiration Date April 1, 2020 2,462,600 $ 0.125 April 1, 2030 April 1, 2020 462,600 $ 0.500 April 1, 2030 March 30, 2020 350,000 $ 1.250 March 30, 2025 August 17, 2020 134,000 $ 1.250 August 17, 2025 March 15, 2022 250,000 $ 0.500 March 15, 2027 March 21, 2022 250,000 $ 0.500 March 21, 2027 March 22, 2022 250,000 $ 0.500 March 22, 2027 March 24, 2022 600,000 $ 0.500 March 24, 2027 4,759,200 |
SUMMARY OF WARRANTS ACTIVITY | A summary of the warrant activity during the three months ended March 31, 2022 is presented below: SUMMARY OF WARRANTS ACTIVITY Number of Warrants Weighted Weighted Outstanding at January 1, 2022 3,409,200 $ 0.34 7.6 Granted 1,350,000 $ 0.50 5.0 Exercised — $ — — Forfeited/Other Adjustments — $ — — Outstanding at March 31, 2022 4,759,200 $ 0.38 6.6 Exercisable at March 31, 2022 4,759,200 $ 0.38 6.6 |
SUMMARY OF CHANGES IN FAIR VALUE WARRANTS | SUMMARY OF CHANGES IN FAIR VALUE WARRANTS Stock price per share $ 0.37 0.40 Term 5.0 Expected volatility 90.00 % Divided yield — Risk-free interest rate 2.10 2.39 % |
SCHEDULE OF SHARE BASED AWARDS | The following table summarizes the share-based awards as of March 31, 2022: SCHEDULE OF SHARE BASED AWARDS Number of Options Weighted Weighted Outstanding at March 31, 2022 450,000 $ 1.38 4.3 Exercisable at March 31, 2022 175,000 $ 2.22 4.3 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
SCHEDULE OF OPERATING LEASE INFORMATION | Supplemental balance sheet information related to leases was as follows (in thousands): SCHEDULE OF OPERATING LEASE INFORMATION Operating Leases Classification March 31, 2022 December 31, 2021 Right-of-use assets Operating lease assets $ 8,336 $ 8,021 Current lease liabilities Current operating lease liabilities 4,425 4,599 Non-current lease liabilities Long-term operating lease liabilities 8,897 8,644 $ 13,322 $ 13,243 Lease term and discount rate were as follows: March 31, 2022 December 31, 2021 Weighted average remaining lease term (years) 6.5 6.7 Weighted average discount rate 7.8 % 8.1 % |
RESTATEMENT OF PREVIOUSLY ISS_2
RESTATEMENT OF PREVIOUSLY ISSUED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
SCHEDULE OF PREVIOUSLY ISSUED INTERIM FINANCIAL STATEMENTS | The following table sets forth the effects of the adjustment on affected items within the Company’s previously reported Condensed Consolidated Balance Sheet: SCHEDULE OF PREVIOUSLY ISSUED INTERIM FINANCIAL STATEMENTS (in thousands) As reported Adjustment As restated March 31, 2021 (in thousands) As reported Adjustment As restated Property and equipment, net $ 3,172 $ 136 $ 3,308 Accumulated deficit $ (97,136 ) $ 136 $ (97,000 ) The following table sets forth the effects of the adjustment on affected items within the Company’s previously reported Condensed Consolidated Statement of Operations: As reported Adjustment As restated Three months ended March 31, 2021 As reported Adjustment As restated Depreciation and amortization $ 368 $ (136 ) $ 232 Operating (loss) income $ (2,790 ) $ 136 $ (2,654 ) Consolidated net (loss) income $ (2,713 ) $ 136 $ (2,577 ) Net (loss) income attributable to Amergent Hospitality Group Inc. $ (2,548 ) $ 136 $ (2,412 ) Net (loss) income attributable to Amergent Hospitality Group Inc. per common share, basic and diluted $ (0.18 ) $ 0.01 $ (0.17 ) |
NATURE OF BUSINESS (Details Nar
NATURE OF BUSINESS (Details Narrative) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Cash and cash equivalents, at carrying value | $ 3.1 | |
Restricted cash, current | 0.6 | $ 1.7 |
Working capital deficit | $ 12 |
SCHEDULE OF FAIR VALUE MEASUREM
SCHEDULE OF FAIR VALUE MEASUREMENTS, RECURRING AND NONRECURRING (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Defined Benefit Plan Disclosure [Line Items] | ||
Common stock of Sonnet | $ 46 | $ 50 |
Convertible note payable | 983 | 1,099 |
Fair Value, Inputs, Level 1 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Common stock of Sonnet | 46 | 50 |
Convertible note payable | ||
Fair Value, Inputs, Level 2 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Common stock of Sonnet | ||
Convertible note payable | ||
Fair Value, Inputs, Level 3 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Common stock of Sonnet | ||
Convertible note payable | $ 983 | $ 1,099 |
SCHEDULE OF PROPERTY AND EQUIPM
SCHEDULE OF PROPERTY AND EQUIPMENT USEFUL LIVES (Details) | 3 Months Ended |
Mar. 31, 2022 | |
Minimum [Member] | Leasehold Improvements [Member] | |
Property, Plant and Equipment [Line Items] | |
Office and computer equipment | 5 years |
Minimum [Member] | Restaurant Furnishings and Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Office and computer equipment | 3 years |
Minimum [Member] | Furniture and Fixtures [Member] | |
Property, Plant and Equipment [Line Items] | |
Office and computer equipment | 3 years |
Minimum [Member] | Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Office and computer equipment | 3 years |
Maximum [Member] | Leasehold Improvements [Member] | |
Property, Plant and Equipment [Line Items] | |
Office and computer equipment | 15 years |
Maximum [Member] | Restaurant Furnishings and Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Office and computer equipment | 10 years |
Maximum [Member] | Furniture and Fixtures [Member] | |
Property, Plant and Equipment [Line Items] | |
Office and computer equipment | 10 years |
Maximum [Member] | Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Office and computer equipment | 7 years |
SIGNIFICANT ACCOUNTING POLICI_4
SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022USD ($)Segment | Dec. 31, 2021USD ($) | Mar. 31, 2021USD ($) | |
Property, Plant and Equipment [Line Items] | |||
Reportable segments | Segment | 1 | ||
Restricted cash, current | $ 600 | $ 1,700 | |
Restricted cash equivalents | 2,528 | 646 | $ 2,400 |
Cash and restricted cash | $ 3,100 | $ 3,200 | |
Operating lease, option to extend | include options to extend the leases for additional 5-year periods. | ||
Operating lease, renewal term | 20 years | ||
Accounts and other receivables | $ 271 | 865 | |
Revitalization fund description | The American Rescue Plan Act established the Restaurant Revitalization Fund (“RRF”) to provide funding to help restaurants and other eligible businesses keep their doors open. This program provided restaurants with funding equal to their pandemic-related revenue loss up to $10.0 million per business and no more than $5.0 million per physical location. | ||
Pie Squared Holdings [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Proceeds from repayment of related party debt | $ 10,000 | ||
Pie Square Holdings LLC [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Proceeds from related party debt | 10,000 | ||
Escrow deposit | 2,000 | ||
Contra-expense | 500 | ||
Employee Retention Credit [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Accounts and other receivables | $ 100 | $ 800 | |
Minimum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Operating lease, remaining lease term | 1 year | ||
Maximum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Operating lease, remaining lease term | 20 years | ||
Trademarks and Trade Names [Member] | Minimum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Intangible assets, estimated useful lives | 3 years | ||
Trademarks and Trade Names [Member] | Maximum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Intangible assets, estimated useful lives | 10 years |
SCHEDULE OF FAIR VALUE LIABILIT
SCHEDULE OF FAIR VALUE LIABILITIES MEASURED ON RECURRING BASIS (Details) - Pie Squared Holdings [Member] $ in Thousands | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Restructuring Cost and Reserve [Line Items] | |
Beginning balance | $ 1,099 |
Change in fair value | (116) |
Ending balance | $ 983 |
SCHEDULE OF ESTIMATED FAIR VALU
SCHEDULE OF ESTIMATED FAIR VALUE ASSUMPTIONS (Details) | Mar. 31, 2022$ / shares |
Measurement Input, Price Volatility [Member] | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Fair value measurement input | 90 |
Measurement Input, Risk Free Interest Rate [Member] | Minimum [Member] | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Fair value measurement input | 0.35 |
Measurement Input, Risk Free Interest Rate [Member] | Maximum [Member] | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Fair value measurement input | 1.90 |
Measurement Input, Share Price [Member] | Minimum [Member] | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Share Price | $ 0.37 |
Measurement Input, Credit Spread [Member] | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Fair value measurement input | 25.43 |
SCHEDULE OF INVESTMENT (Details
SCHEDULE OF INVESTMENT (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 | |
Investments, All Other Investments [Abstract] | |||
Common stock of Sonnet, at fair value | [1] | $ 46 | $ 50 |
Chanticleer Investors, LLC, at cost | [2] | 16 | 16 |
Total | $ 62 | $ 66 | |
[1] | Represents the fair value of the common stock of Sonnet held by the Company after its exercise of warrants received in connection with the Merger. As of March 31, 2022, 122,064 | ||
[2] | Represents the Company’s investment in Chanticleer Investors, LLC, which holds an interest in Hooters of America, the operator and franchisor of the Hooters Brand worldwide. As of the dates presented, the Company’s effective economic interest in Hooters of America was less than 1%. 0.1 |
SCHEDULE OF INVESTMENT (Detai_2
SCHEDULE OF INVESTMENT (Details) (Parenthetical) $ in Millions | 3 Months Ended |
Mar. 31, 2022USD ($)shares | |
Investment description | the Company’s effective economic interest in Hooters of America was less than 1%. |
Accounts receivable net | $ | $ 0.1 |
Sonet [Member] | |
Held shares | shares | 122,064 |
SCHEDULE OF PROPERTY, PLANT AND
SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 | Mar. 31, 2021 |
Property, Plant and Equipment [Abstract] | |||
Leasehold improvements | $ 5,535 | $ 5,511 | |
Restaurant furniture and equipment | 2,768 | 2,768 | |
Construction in progress | 41 | 20 | |
Office and computer equipment | 37 | 33 | |
Office furniture and fixtures | 63 | 57 | |
Property,plant and equipment, gross | 8,444 | 8,389 | |
Accumulated depreciation and amortization | (5,403) | (5,274) | |
Property, plant and equipment, net | $ 3,041 | $ 3,115 | $ 3,308 |
PROPERTY AND EQUIPMENT, NET (De
PROPERTY AND EQUIPMENT, NET (Details Narrative) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | ||
Impairment of Intangible Assets, Finite-Lived | $ 0.3 | |
Depreciation | $ 0.1 | $ 0.1 |
SCHEDULE OF GOODWILL (Details)
SCHEDULE OF GOODWILL (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2022 | Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Beginning balance | $ 7,810 | $ 8,591 |
Acquisition of Pie Squared Holdings | 51 | |
Sale of Hooters UK | (820) | |
Foreign currency translation loss | (12) | |
Ending balance | $ 7,810 | $ 7,810 |
SCHEDULE OF FINITE - LIVED INTA
SCHEDULE OF FINITE - LIVED INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Dec. 31, 2021 | |
Finite-Lived Intangible Assets [Line Items] | ||
Total intangibles at cost | $ 4,498 | $ 4,498 |
Accumulated amortization | (1,460) | (1,369) |
Intangible assets, net | 3,038 | 3,129 |
Trademarks and Trade Names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangibles at cost | $ 3,260 | 3,260 |
Trademarks and Trade Names [Member] | American Roadside Burger [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated life | 10 years | |
Total intangibles at cost | $ 561 | 561 |
Trademarks and Trade Names [Member] | The Burger Joint [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangibles at cost | $ 739 | 739 |
Estimated life description | Indefinite | |
Trademarks and Trade Names [Member] | Little Big Burger [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangibles at cost | $ 1,550 | 1,550 |
Estimated life description | Indefinite | |
Trademarks and Trade Names [Member] | PizzaRev [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated life | 5 years | |
Total intangibles at cost | $ 410 | 410 |
Franchise Rights [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangibles at cost | $ 1,238 | 1,238 |
Franchise Rights [Member] | The Burger Joint [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated life | 7 years | |
Total intangibles at cost | $ 828 | 828 |
Franchise Rights [Member] | PizzaRev [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated life | 5 years | |
Total intangibles at cost | $ 410 | $ 410 |
SCHEDULE OF AMORTIZATION OF INT
SCHEDULE OF AMORTIZATION OF INTANGIBLE ASSETS (Details) $ in Thousands | Mar. 31, 2022USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2022 (remaining nine months) | $ 147 |
2023 | 164 |
2024 | 164 |
2025 | 164 |
2026 | 110 |
Amortization, net | $ 749 |
INTANGIBLE ASSETS, NET (Details
INTANGIBLE ASSETS, NET (Details Narrative) $ in Millions | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Trademarks and Trade Names [Member] | |
Indefinite-Lived Intangible Assets [Line Items] | |
Impairment charges | $ 0.3 |
SCHEDULE OF DEBT AND NOTES PAYA
SCHEDULE OF DEBT AND NOTES PAYABLE (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 | |
Short-Term Debt [Line Items] | |||
Total debt | $ 11,384 | $ 9,894 | |
Less: discount on convertible debt | [1],[2] | (293) | (37) |
Total debt, net of discount | 11,091 | 9,857 | |
Current portion of long-term debt | 3,651 | 3,264 | |
Long-term debt, less current portion | 7,440 | 6,593 | |
Convertible Debt One [Member] | |||
Short-Term Debt [Line Items] | |||
Total debt | [1] | 4,038 | 4,038 |
Convertible Debt Two [Member] | |||
Short-Term Debt [Line Items] | |||
Total debt | [2] | 1,350 | |
Convertible Promissory Note [Member] | |||
Short-Term Debt [Line Items] | |||
Total debt | [3] | 983 | 1,099 |
PPP Loans [Member] | |||
Short-Term Debt [Line Items] | |||
Total debt | [4] | 4,109 | 4,109 |
Economic Injury Disaster Loan [Member] | |||
Short-Term Debt [Line Items] | |||
Total debt | [5] | 300 | 300 |
Contractor Note [Member] | |||
Short-Term Debt [Line Items] | |||
Total debt | [6] | 348 | 348 |
Notes Payable [Member] | |||
Short-Term Debt [Line Items] | |||
Total debt | [7] | $ 256 | |
[1] | In connection with and prior to the Spin-Off and Merger, on April 1, 2020, pursuant to an agreement among Chanticleer, Oz Rey, LLC (“Oz Rey”) and certain original holders of the 8% non-convertible debentures that were satisfied during 2020, the Company issued a 10% secured convertible debenture (the “10% Convertible Debt”) to Oz Rey in exchange for the 8% non-convertible debentures. The principal amount of the 10% Convertible Debt is $4.0 million and payable in full on April 1, 2022, subject to extension by the holders in two-year intervals for up to 10 years from the issuance date upon Amergent meeting certain conditions 2,925,200 0.125 2,462,600 0.50 462,500 10 | ||
[2] | In March 2022, the Company commenced a private placement of up to $ 3.0 3,000,000 common stock warrants. Pursuant to the Securities Purchase Agreement, the Company issued $ 1.35 | ||
[3] | On August 30, 2021, the Company purchased all of the outstanding membership interests in Pie Squared Holdings. The purchase price was funded through the issuance of an 8% secured, convertible promissory note with a face value of $ | ||
[4] | On April 27, 2020, Amergent received a Paycheck Protection Program (“PPP”) loan in the amount of approximately $ 2.1 1 0.1 | ||
[5] | On August 4, 2020, the Company obtained two loans under the Economic Injury Disaster Loan (“EIDL”) assistance program from the U.S. SBA in light of the impact of the COVID-19 pandemic on the Company’s business. The principal amount of the loans is $ 0.3 3.75 1,462 | ||
[6] | The Company entered into a promissory note to repay a contractor for the build-out of a new Little Big Burger location. The note bears interest at 12 0.4 0.1 | ||
[7] | In February and March 2022, eight company-owned stores entered into notes payable to Toast Capital Loans. The terms of the notes require payment of 13.2 270 15 |
SCHEDULE OF DEBT AND NOTES PA_2
SCHEDULE OF DEBT AND NOTES PAYABLE (Details) (Parenthetical) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | Aug. 30, 2021 | Feb. 25, 2021 | Aug. 04, 2020 | Apr. 27, 2020 | Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Apr. 02, 2020 | |
Short-Term Debt [Line Items] | ||||||||||
Warrants and Rights Outstanding, Term | 5 years | |||||||||
Debt discount | [1],[2] | $ 293 | $ 37 | |||||||
Debt conversion amount | 27,000 | |||||||||
Private placement | 3,000 | |||||||||
Common stock warrants | 3,000,000,000 | |||||||||
Number of common stock issued debt | $ 1,350 | |||||||||
Debt instrument, term | 18 months | |||||||||
Interest Expense | $ 6,000 | |||||||||
Pie Squared Holdings [Member] | Purchase Agreement [Member] | ||||||||||
Short-Term Debt [Line Items] | ||||||||||
Debt face amount | $ 1,000 | |||||||||
Convertible Debt | 1,200 | |||||||||
Principal amount | $ 500 | |||||||||
Convertible Debt One [Member] | ||||||||||
Short-Term Debt [Line Items] | ||||||||||
Convertible debt percentage | 10.00% | 10.00% | ||||||||
Convertible Debt Two [Member] | ||||||||||
Short-Term Debt [Line Items] | ||||||||||
Convertible debt percentage | 8.00% | 8.00% | ||||||||
10% Secured Convertible Debenture [Member] | ||||||||||
Short-Term Debt [Line Items] | ||||||||||
Debt instrument, description | In connection with the 8% Convertible Debt transaction described in (b) below, the maturity date of the 10% Convertible Debt was extended to April 1, 2024 and Oz Rey agreed to subordinate payment of its 10% Convertible Debt to payment of the 8% Convertible Debt, which has been accounted for as a loan modification. In addition, Oz Rey received a fee equal to 2.0% of the principal amount of the 8% Convertible Debt issued in the transaction, totaling $27,000, which has been recorded as a debt discount and is being amortized over the two-year term of the related debt | In connection with and prior to the Spin-Off and Merger, on April 1, 2020, pursuant to an agreement among Chanticleer, Oz Rey, LLC (“Oz Rey”) and certain original holders of the 8% non-convertible debentures that were satisfied during 2020, the Company issued a 10% secured convertible debenture (the “10% Convertible Debt”) to Oz Rey in exchange for the 8% non-convertible debentures. The principal amount of the 10% Convertible Debt is $4.0 million and payable in full on April 1, 2022, subject to extension by the holders in two-year intervals for up to 10 years from the issuance date upon Amergent meeting certain conditions | ||||||||
8% Non-convertible Secured Debentures [Member] | ||||||||||
Short-Term Debt [Line Items] | ||||||||||
Number of securities called by each warrant or right | 2,925,200 | |||||||||
Warrants and Rights Outstanding, Term | 10 years | |||||||||
8% Non-convertible Secured Debentures [Member] | Warrant One [Member] | ||||||||||
Short-Term Debt [Line Items] | ||||||||||
Number of securities called by each warrant or right | 2,462,600 | |||||||||
Exercise price of warrants or rights | $ 0.125 | |||||||||
8% Non-convertible Secured Debentures [Member] | Warrant Two [Member] | ||||||||||
Short-Term Debt [Line Items] | ||||||||||
Number of securities called by each warrant or right | 462,500 | |||||||||
Exercise price of warrants or rights | $ 0.50 | |||||||||
10% Convertible Notes [Member] | ||||||||||
Short-Term Debt [Line Items] | ||||||||||
Debt discount | $ 400 | |||||||||
Debt discount | $ 37,000 | $ 45,000 | ||||||||
PPP Loan [Member] | ||||||||||
Short-Term Debt [Line Items] | ||||||||||
Proceeds from loan | $ 2,000 | $ 2,100 | ||||||||
Implied interest rate | 1.00% | 1.00% | ||||||||
Debt payments | $ 45,000 | $ 100 | ||||||||
Debt maturity | Feb. 25, 2026 | |||||||||
Economic Injury Disaster Loan [Member] | ||||||||||
Short-Term Debt [Line Items] | ||||||||||
Debt face amount | $ 300 | |||||||||
Implied interest rate | 3.75% | |||||||||
Debt payments | $ 1,462 | |||||||||
Promissory Note [Member] | ||||||||||
Short-Term Debt [Line Items] | ||||||||||
Implied interest rate | 12.00% | |||||||||
Loan defendant | $ 400 | |||||||||
Accounts payable and accrued expenses | $ 100 | $ 100 | ||||||||
Notes Payable [Member] | ||||||||||
Short-Term Debt [Line Items] | ||||||||||
Debt instrument, term | 270 days | |||||||||
Implied interest rate | 13.20% | |||||||||
Notes Payable One [Member] | ||||||||||
Short-Term Debt [Line Items] | ||||||||||
Implied interest rate | 15.00% | |||||||||
[1] | In connection with and prior to the Spin-Off and Merger, on April 1, 2020, pursuant to an agreement among Chanticleer, Oz Rey, LLC (“Oz Rey”) and certain original holders of the 8% non-convertible debentures that were satisfied during 2020, the Company issued a 10% secured convertible debenture (the “10% Convertible Debt”) to Oz Rey in exchange for the 8% non-convertible debentures. The principal amount of the 10% Convertible Debt is $4.0 million and payable in full on April 1, 2022, subject to extension by the holders in two-year intervals for up to 10 years from the issuance date upon Amergent meeting certain conditions 2,925,200 0.125 2,462,600 0.50 462,500 10 | |||||||||
[2] | In March 2022, the Company commenced a private placement of up to $ 3.0 3,000,000 common stock warrants. Pursuant to the Securities Purchase Agreement, the Company issued $ 1.35 |
SCHEDULE OF FUTURE MINIMUM PAYM
SCHEDULE OF FUTURE MINIMUM PAYMENTS (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |||
2022 (remaining nine months) | $ 3,520 | ||
2023 | 2,383 | ||
2024 | 4,579 | ||
2025 | 547 | ||
2026 | 98 | ||
Thereafter | 274 | ||
Less: discount on convertible debt | [1],[2] | (293) | $ (37) |
Less: fair value adjustment | (17) | ||
Debt | 11,091 | ||
Less: current maturities of long-term debt and notes payable | (3,651) | (3,264) | |
Long-term debt and notes payable | $ 7,440 | $ 6,593 | |
[1] | In connection with and prior to the Spin-Off and Merger, on April 1, 2020, pursuant to an agreement among Chanticleer, Oz Rey, LLC (“Oz Rey”) and certain original holders of the 8% non-convertible debentures that were satisfied during 2020, the Company issued a 10% secured convertible debenture (the “10% Convertible Debt”) to Oz Rey in exchange for the 8% non-convertible debentures. The principal amount of the 10% Convertible Debt is $4.0 million and payable in full on April 1, 2022, subject to extension by the holders in two-year intervals for up to 10 years from the issuance date upon Amergent meeting certain conditions 2,925,200 0.125 2,462,600 0.50 462,500 10 | ||
[2] | In March 2022, the Company commenced a private placement of up to $ 3.0 3,000,000 common stock warrants. Pursuant to the Securities Purchase Agreement, the Company issued $ 1.35 |
LONG-TERM DEBT AND NOTES PAYA_3
LONG-TERM DEBT AND NOTES PAYABLE (Details Narrative) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 3 Months Ended | |||
Mar. 31, 2022 | Dec. 31, 2021 | Aug. 30, 2021 | Dec. 31, 2020 | |
Short-Term Debt [Line Items] | ||||
Debt Instrument, Convertible, Conversion Price | $ 0.40 | $ 0.50 | ||
[custom:DebtInstrumentConvertibleExercisePrice-0] | $ 0.50 | |||
Warrants and Rights Outstanding, Term | 5 years | |||
Debt instrument conversion | 3,375,000 | |||
Proceeds from Issuance of Long-Term Debt and Capital Securities, Net | $ 1 | |||
Minimum [Member] | ||||
Short-Term Debt [Line Items] | ||||
Debt Instrument, Convertible, Conversion Price | $ 0.50 | |||
Maximum [Member] | ||||
Short-Term Debt [Line Items] | ||||
Debt Instrument, Convertible, Conversion Price | $ 2,000 | |||
Warrant [Member] | ||||
Short-Term Debt [Line Items] | ||||
Warrants and Rights Outstanding, Term | 5 years | |||
Proceeds from Issuance of Long-Term Debt and Capital Securities, Net | $ 0.3 | |||
Convertible Common Stock [Member] | ||||
Short-Term Debt [Line Items] | ||||
Conversion of stock shares converted | 2,000,000 | |||
Convertible Common Stock [Member] | Convertible Debt [Member] | ||||
Short-Term Debt [Line Items] | ||||
Conversion of stock, amount converted | $ 2.4 | |||
Debt instrument convertible percentage | 10.00% | |||
Conversion of stock shares converted | 23,500,000 | |||
8% Non-convertible Secured Debentures [Member] | ||||
Short-Term Debt [Line Items] | ||||
Debt Instrument, Convertible, Conversion Price | $ 0.10 | |||
Warrants and Rights Outstanding, Term | 10 years |
SCHEDULE OF ACCOUNTS PAYABLE AN
SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Payables and Accruals [Abstract] | ||
Accounts payable | $ 2,357 | $ 2,544 |
Accrued expenses | 2,130 | 1,955 |
Accrued taxes (VAT, sales, payroll, etc.) | 2,080 | 2,149 |
Accrued interest | 232 | 196 |
Accounts payable and accrued expenses, total | $ 6,799 | $ 6,844 |
ACCOUNTS PAYABLE AND ACCRUED _3
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Details Narrative) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Payables and Accruals [Abstract] | ||
Employee related liabilities | $ 1.9 | $ 2 |
Compensating balance amount | $ 0.8 |
SCHEDULE OF OUTSTANDING WARRANT
SCHEDULE OF OUTSTANDING WARRANTS (Details) | Mar. 31, 2022$ / sharesshares |
Class of Warrant or Right [Line Items] | |
Number of warrants | 4,759,200 |
Warrants Issued on April 1, 2020 [Member] | |
Class of Warrant or Right [Line Items] | |
Number of warrants | 2,462,600 |
Exercise price | $ / shares | $ 0.125 |
Expiration date | Apr. 1, 2030 |
Warrants Issued on April 1, 2020 [Member] | |
Class of Warrant or Right [Line Items] | |
Number of warrants | 462,600 |
Exercise price | $ / shares | $ 0.500 |
Expiration date | Apr. 1, 2030 |
Warrants Issued on March 30, 2020 [Member] | |
Class of Warrant or Right [Line Items] | |
Number of warrants | 350,000,000 |
Exercise price | $ / shares | $ 1.250 |
Expiration date | Mar. 30, 2025 |
Warrants Issued on August 17, 2020 [Member] | |
Class of Warrant or Right [Line Items] | |
Number of warrants | 134,000 |
Exercise price | $ / shares | $ 1.250 |
Expiration date | Aug. 17, 2025 |
Warrants Issued On March 15, 2022 [Member] | |
Class of Warrant or Right [Line Items] | |
Number of warrants | 250,000 |
Exercise price | $ / shares | $ 0.500 |
Expiration date | Mar. 15, 2027 |
Warrants Issued On March 21, 2022 [Member] | |
Class of Warrant or Right [Line Items] | |
Number of warrants | 250,000 |
Exercise price | $ / shares | $ 0.500 |
Expiration date | Mar. 21, 2027 |
Warrants Issued On March 22, 2022 [Member] | |
Class of Warrant or Right [Line Items] | |
Number of warrants | 250,000 |
Exercise price | $ / shares | $ 0.500 |
Expiration date | Mar. 22, 2027 |
Warrants Issued On March 24, 2022 [Member] | |
Class of Warrant or Right [Line Items] | |
Number of warrants | 600,000 |
Exercise price | $ / shares | $ 0.500 |
Expiration date | Mar. 24, 2027 |
SUMMARY OF WARRANTS ACTIVITY (D
SUMMARY OF WARRANTS ACTIVITY (Details) | 3 Months Ended |
Mar. 31, 2022$ / sharesshares | |
Equity [Abstract] | |
Number of warrants outstanding, beginning balance | shares | 3,409,200 |
Weighted average exercise price, beginning balance | $ / shares | $ 0.34 |
Weighted average remaining life, beginning balance | 7 years 7 months 6 days |
Number of warrants outstanding, granted | shares | 1,350,000 |
Weighted average exercise price, granted | $ / shares | $ 0.50 |
Weighted average remaining life, granted | 5 years |
Number of warrants outstanding, exercised | shares | |
Weighted average exercise price, exercised | $ / shares | |
Number of warrants outstanding, forfeited / other adjustments | shares | |
Weighted average exercise price, forfeited / other adjustments | $ / shares | |
Number of warrants outstanding, ending balance | shares | 4,759,200 |
Weighted average exercise price, ending balance | $ / shares | $ 0.38 |
Weighted average remaining life, ending balance | 6 years 7 months 6 days |
Number of warrants exercisable, ending balance | shares | 4,759,200,000 |
Weighted average exercise price, ending balance | $ / shares | $ 0.38 |
Weighted average remaining life, ending balance | 6 years 7 months 6 days |
SUMMARY OF CHANGES IN FAIR VALU
SUMMARY OF CHANGES IN FAIR VALUE WARRANTS (Details) | Mar. 31, 2022$ / shares |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Term | 5 years |
Measurement Input, Price Volatility [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Fair value assumptions, measurement input, percentages | 90 |
Measurement Input Dividend Yield [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Fair value assumptions, measurement input, percentages | |
Minimum [Member] | Measurement Input, Risk Free Interest Rate [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Fair value assumptions, measurement input, percentages | 2.10 |
Maximum [Member] | Measurement Input, Risk Free Interest Rate [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Fair value assumptions, measurement input, percentages | 2.39 |
Warrant [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Term | 5 years |
Warrant [Member] | Minimum [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Stock price per share | $ 0.37 |
Warrant [Member] | Maximum [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Stock price per share | $ 0.40 |
SCHEDULE OF SHARE BASED AWARDS
SCHEDULE OF SHARE BASED AWARDS (Details) | 3 Months Ended |
Mar. 31, 2022$ / sharesshares | |
Equity [Abstract] | |
Number of warrants outstanding, ending balance | shares | 450,000 |
Weighted average exercise price, ending balance | $ / shares | $ 1.38 |
Weighted average remaining life, ending balance | 4 years 3 months 18 days |
Number of warrants exercisable, ending balance | shares | 175,000,000 |
Weighted average exercise price exercisable, ending balance | $ / shares | $ 2.22 |
Weighted average remaining life, exercisable | 4 years 3 months 18 days |
STOCKHOLDER_S EQUITY (Details N
STOCKHOLDER’S EQUITY (Details Narrative) | Feb. 16, 2021USD ($) | Aug. 17, 2020USD ($)shares | Feb. 07, 2020USD ($)$ / sharesshares | Aug. 31, 2021 | Jul. 31, 2021USD ($) | May 31, 2021shares | Mar. 31, 2020shares | Mar. 31, 2022USD ($)$ / sharesshares | Mar. 31, 2021shares | Dec. 31, 2021USD ($)$ / sharesshares | Nov. 30, 2021shares | Aug. 30, 2021$ / shares |
Class of Stock [Line Items] | ||||||||||||
Warrants term | 5 years | |||||||||||
Warrants to purchase common stock | 1,350,000 | |||||||||||
Common stock, par value | $ / shares | $ 0.0001 | $ 0.0001 | ||||||||||
Number of warrants issued to purchase common stock | 4,759,200 | |||||||||||
Payment for incentive fee | $ | $ 100,000 | |||||||||||
Change in fair value of Derivative net | $ | $ 200,000 | |||||||||||
Debt instrument convertible conversion price | $ / shares | $ 0.40 | $ 0.50 | ||||||||||
Common stock, capital shares reserved for future issuance | 500,000 | 2,000,000 | ||||||||||
Common stock remained reserved for future grants | 50,000 | |||||||||||
Common stock remained reserved for future grants | 2,000,000 | |||||||||||
Share based awards vest period term | 3 years | |||||||||||
Contractual life term | 5 years | |||||||||||
Share based compensation expense | $ | $ 6,000 | |||||||||||
Unrecognized compensation cost | $ | $ 43,000 | |||||||||||
Weighted average remaining contractual term | 1 year 6 months | |||||||||||
Common Stock [Member] | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Stock issued during period conversion of convertible securities | 250,000 | |||||||||||
Other Investors [Member] | Common Stock [Member] | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Stock issued during period conversion of convertible securities | 150 | |||||||||||
Maximum [Member] | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Debt instrument convertible conversion price | $ / shares | $ 2,000 | |||||||||||
Minimum [Member] | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Debt instrument convertible conversion price | $ / shares | $ 0.50 | |||||||||||
True Up Payment [Member] | Original Investors [Member] | Common Stock [Member] | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Stock issued during period conversion of convertible securities | 100,000 | 1,274,000 | ||||||||||
2020 Bridge Financing [Member] | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Percentage of cash equal to dollar value | 1.25 | |||||||||||
Convertible Preferred Stock: Series 2 [Member] | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Preferred stock, shares issued | 100 | 100 | ||||||||||
Convertible Preferred Stock: Series 2 [Member] | 2020 Bridge Financing [Member] | Securities Purchase Agreement [Member] | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Preferred stock, shares issued | 713 | |||||||||||
Stock issued during period conversion of convertible securities | 1,426,849 | |||||||||||
Preferred stock description | the shareholders of Chanticleer common stock received shares of Amergent on a 1 for 1 basis (spin-off shares) and received 1 share of Sonnet common stock for 26 shares of Chanticleer common stock held at the time of the Merger | |||||||||||
Convertible Preferred Stock: Series 2 [Member] | 2020 Bridge Financing [Member] | Securities Purchase Agreement [Member] | Chanticleer [Member] | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Sale of stock, number of shares | 1,500 | |||||||||||
Gross proceeds preference stock | $ | $ 1,500,000 | |||||||||||
Sale of stock, transaction costs | $ | $ 100,000 | |||||||||||
Warrants term | 5 years | |||||||||||
Warrants to purchase common stock | 350,000 | |||||||||||
Common stock, par value | $ / shares | $ 1.25 | |||||||||||
Preferred stock value | $ | $ 1,000 | |||||||||||
Embedded derivative liability | $ | 500,000 | |||||||||||
Beneficial conversion feature | $ | $ 700,000 | |||||||||||
Series 2 Preferred Stock [Member] | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Cash payment to stock holders | $ | $ 66,000 | |||||||||||
Number of warrants issued to purchase common stock | 134,000 | |||||||||||
Common stock were issued value | $ | $ 28,060 | |||||||||||
Series 2 Preferred Stock [Member] | Other Investors [Member] | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Stock issued during period conversion of convertible securities | 50 | 100 | ||||||||||
Series 2 Preferred Stock [Member] | True Up Payment [Member] | Original Investors [Member] | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Stock issued during period conversion of convertible securities | 637 | |||||||||||
Preferred Stock: Series 2 [Member] | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Stock issued during period conversion of convertible securities | 1,400 | |||||||||||
Preferred Stock: Series 2 [Member] | 2020 Bridge Financing [Member] | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Debt instrument convertible conversion price | $ / shares | $ 1 | |||||||||||
Beneficial ownership percentage limitation | 4.99% | |||||||||||
Percentage of limitation prior to merger | 9.99% | |||||||||||
Preferred Stock: Series 2 [Member] | 2020 Bridge Financing [Member] | Maximum [Member] | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Common stock were issued value | $ | $ 1,300,000 | |||||||||||
Preferred Stock: Series 2 [Member] | 2020 Bridge Financing [Member] | Minimum [Member] | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Common stock were issued value | $ | $ 900,000 | |||||||||||
Series Two Preferred Stock [Member] | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Preferred stock value | $ | $ 1,000 |
SCHEDULE OF OPERATING LEASE INF
SCHEDULE OF OPERATING LEASE INFORMATION (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Commitments and Contingencies Disclosure [Abstract] | ||
Right-of-use assets | $ 8,336 | $ 8,021 |
Current lease liabilities | 4,425 | 4,599 |
Non-current lease liabilities | 8,897 | 8,644 |
Operating Lease Liability | $ 13,322 | $ 13,243 |
Weighted average remaining lease term (years) | 6 years 6 months | 6 years 8 months 12 days |
Weighted average discount rate | 7.80% | 8.10% |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Loss Contingencies [Line Items] | ||
Insurance in coverage amount | $ 3,000,000 | |
Impairment charge of right-of-use asset | 700,000 | |
Unrecognized lease liabilities | $ 43,000 | |
Related to abandoned leases liabilities | 2,500,000 | |
Increase in right of use assets and liabilities | 600,000 | |
Rent expenses | 500,000 | 600,000 |
Variable [Member] | ||
Loss Contingencies [Line Items] | ||
Rent expenses | 13,000 | $ 100,000 |
PPP Loan [Member] | ||
Loss Contingencies [Line Items] | ||
Debt instrument, face amount | 4,100,000 | |
PPP Loan [Member] | Maximum [Member] | ||
Loss Contingencies [Line Items] | ||
Debt instrument, face amount | 2,000,000 | |
Restaurant Revitalization Fund [Member] | ||
Loss Contingencies [Line Items] | ||
Debt instrument, face amount | 10,000,000 | |
Repayment of ramifications grant | $ 10,000,000 |
SCHEDULE OF PREVIOUSLY ISSUED I
SCHEDULE OF PREVIOUSLY ISSUED INTERIM FINANCIAL STATEMENTS (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Property and equipment, net | $ 3,041 | $ 3,308 | $ 3,115 |
Accumulated deficit | (97,990) | (97,000) | $ (97,963) |
Depreciation and amortization | 222 | 232 | |
Operating (loss) income | (331) | (2,654) | |
Consolidated net (loss) income | (28) | (2,577) | |
Net (loss) income attributable to Amergent Hospitality Group Inc. | $ (27) | $ (2,412) | |
Net (loss) income attributable to Amergent Hospitality Group Inc. per common share, basic and diluted | $ 0 | $ (0.17) | |
Previously Reported [Member] | |||
Property and equipment, net | $ 3,172 | ||
Accumulated deficit | (97,136) | ||
Depreciation and amortization | 368 | ||
Operating (loss) income | (2,790) | ||
Consolidated net (loss) income | (2,713) | ||
Net (loss) income attributable to Amergent Hospitality Group Inc. | $ (2,548) | ||
Net (loss) income attributable to Amergent Hospitality Group Inc. per common share, basic and diluted | $ (0.18) | ||
Revision of Prior Period, Adjustment [Member] | |||
Property and equipment, net | $ 136 | ||
Accumulated deficit | 136 | ||
Depreciation and amortization | (136) | ||
Operating (loss) income | 136 | ||
Consolidated net (loss) income | 136 | ||
Net (loss) income attributable to Amergent Hospitality Group Inc. | $ 136 | ||
Net (loss) income attributable to Amergent Hospitality Group Inc. per common share, basic and diluted | $ 0.01 |