|12 Months Ended|
Dec. 31, 2014
|Debt Disclosure [Abstract]|
On October 1, 2009, ONE Group purchased the following membership units from a former member: 10.14% in JEC II, 6.55% in One Marks, 5.19% in Little West 12 th and 4.63% in One LA. The Company paid $400,000, of which $300,000 was paid in cash and $100,000 in the form of a note and issued warrants to purchase up to 10,090 membership units of the Company at an exercise price of $22.94 per membership unit which were cancelled in connection with the Merger. Commencing in December 2009, quarterly payments of principal and interest in the amount of $5,656 are to accrue at an interest at a rate of 5% through September 2014. At December 31, 2014 and December 31, 2013, $0 and $15,000 remained outstanding under this note, respectively.
On June 3, 2014 the Company entered into Amendment No. 3 to the Credit Agreement with BankUnited, N.A.(formerly Herald National Bank), dated October 31, 2011, as amended on January 24, 2013 and October 15, 2013 (as amended, the "Credit Agreement"), to adjust the commitment termination date to October 31, 2014 and the maturity date of the Credit Agreement to October 31, 2015.
On August 6, 2014, the Company entered into Amendment No. 4 and Addendum to the Credit Agreement with BankUnited to, among other things, increase its available borrowings under the Credit Agreement to $9.1 million, as well as update certain definitions, add additional subsidiaries as borrowers, remove the advance ratio covenant and add a debt service coverage ratio calculation. The covenant calculations were effective for the period ending December 31, 2014 and the Company was in compliance with all of the new covenants as of December 31, 2014.
On October 31, 2014, the Company entered into Amendment No. 5 and Addendum to the Credit Agreement with BankUnited to add one additional subsidiary as a borrower.
On December 17, 2014, the Company entered into a Term Loan Agreement with BankUnited in the amount of $7,475,000 maturing December 1, 2019 (the "Term Loan Agreement"). The Term Loan Agreement replaced the existing Credit Agreement which was terminated and the aggregate principal amount of the existing loans outstanding of $6,395,071 was converted into the Term Loan Agreement. Commencing on January 1, 2015, the Company will make sixty (60) consecutive monthly installments of $124,583 plus interest that will accrue at an annual rate of 5.0%. Our obligations under the Term Loan Agreement are secured by substantially all of our assets.
The Term Loan Agreement contains certain affirmative and negative covenants, including negative covenants that limit or restrict, among other things, liens and encumbrances, secured indebtedness, mergers, asset sales, investments, assumptions and guaranties of indebtedness of other persons, change in nature of operations, changes in fiscal year and other matters customarily restricted in such agreements. The financial covenants contained in the Term Loan Agreement require the Borrowers to maintain a certain adjusted tangible net worth and a debt service coverage ratio.
At December 31, 2014 $7,475,000 was outstanding under the Term Loan Agreement and at December 31, 2013 $4,316,865 was outstanding on the terminated Credit Agreement.
The Company was in compliance with all of its financial covenants under the Term Loan Agreement as of December 31, 2014 and the Company believes based on current projections that the Company will continue to comply with such covenants in 2015.
Interest expense recognized related to these notes amounted to $294,726 and $293,136 for the years ended December 31, 2014 and 2013, respectively. Capitalized interest amounted to $187,106 and $0 for the years ended December 31, 2014 and 2013, respectively.
As of December 31, 2014, the issued letters of credit in the total amount of approximately $1.5 million for our STK locations in Orlando, Florida, Chicago, Illinois and Westwood, California remain outstanding.
The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.
Reference 1: http://www.xbrl.org/2003/role/presentationRef