Commitments and contingencies |
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| Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Commitments and contingencies |
Commitments and contingencies:
Operating leases:
The Company is obligated under several operating leases for the restaurants, equipment and office space, expiring in various years through 2031, which provide for minimum annual rentals, escalations, percentage rent, common area expenses or increases in real estate taxes.
Future minimum rental commitments under the leases and minimum future rental income per the sublease in five years subsequent to September 30, 2016 and thereafter are as follows:
Rent expense (including percentage rent of $286,762 and $71,428 for the three months ended September 30, 2016 and 2015, respectively, and $474,192 and $239,204 for the nine months ended September 30, 2016 and 2015, respectively), included in continuing operations, amounted to $1,254,951 and $937,700 for the three months ended September 30, 2016 and 2015, respectively, and $4,013,837 and $2,832,266 for the nine months ended September 30, 2016 and 2015, respectively. Rent expense included in continuing operations has been reported in the consolidated statements of operations and comprehensive income (loss) net of rental income of $163,226 and $179,186 for the three months ended September 30, 2016 and 2015, respectively, and $589,461 and $545,348 for the nine months ended September 30, 2016 and 2015, respectively, related to subleases with related and unrelated parties which expire through 2025.
License and management fees:
Pursuant to its amended and restated operating agreement executed in June 2007, Bridge (a consolidated entity) is obligated to pay management fees equal to 2% of revenues to a member for the life of the agreement. Bridge ceased operations in 2015. Management fees amounted to $39,132 for the nine months ended September 30, 2015. Included in accounts payable at December 31, 2015 are amounts due for management fees of $542.
In January 2010, STK Vegas entered into a management agreement with a third party for a term of 10 years, with two five-year option periods. Under this agreement, STK Vegas shall receive a management fee equal to 5% of gross sales, as defined (“gross sales fee”) plus 20% of net profits prior to the investment breakeven point date and 43% of net profits thereafter (“incentive fee”). In addition, STK Vegas is entitled to receive a development fee equal to $200,000. The Company has elected to receive a credit against a portion of its obligation (estimated at approximately $387,000) to fund the build-out in lieu of receiving the $200,000. Management fees amounted to $1,111,294 and $1,015,876 for the three months ended September 30, 2016 and 2015, respectively, and $3,515,775 and $3,589,914 for the nine months ended September 30, 2016 and 2015, respectively.
In July 2009, One 29 Park Management (a related party) entered into an agreement with a third party. Under this agreement, One 29 Park Management shall receive a management fee equal to 5% of gross revenues, as defined, from the restaurant, banquets, room service and rooftop sales and 50% of the base beverage fee, as defined, for the life of the management agreement which expires in 2025. Management fees amounted to $129,990 and $148,521 for the three months ended September 30, 2016 and 2015, respectively, and $375,697 and $425,469 for the nine months ended September 30, 2016 and 2015, respectively. Included in due from related parties at September 30, 2016 and December 31, 2015 are amounts due for management fees and reimbursable expenses of $265,952 and $298,219, respectively.
In July 2010, Hip Hospitality UK entered into a management agreement with a third party to manage and operate the F&B operations in the Hippodrome Casino in London. Under this agreement, Hip Hospitality UK shall receive a management fee equal to 5.5% of total revenue, as defined, as well as an incentive fee if certain conditions are met, for the life of the management agreement which expires in 2022. Management fees amounted to $111,025 and $148,191 for the three months ended September 30, 2016 and 2015, respectively, and $397,371 and $476,608 for the nine months ended September 30, 2016 and 2015, respectively. Included in accounts receivable at September 30, 2016 and December 31, 2015 are amounts due for management fees of $182,881 and $443,989, respectively.
In December 2011, TOG Aldwych entered into a management agreement with a third party to operate a restaurant, bar and lounges in the ME Hotel in London. Under this agreement, TOG Aldwych shall receive a management fee equal to 5% of receipts received from F&B operations. In addition, TOG Aldwych is entitled to receive a monthly marketing fee equal to 1.5% of receipts received from F&B operations and an additional fee equal to 65% of net operating profits, as defined, for the life of the management agreement which expires in 2032. Management fees amounted to $289,885 and $346,448 for the three months ended September 30, 2016 and 2015, respectively, and $839,998 and $940,997 for the nine months ended September 30, 2016 and 2015, respectively. Included in accounts receivable at September 30, 2016 and December 31, 2015 are amounts due for management fees of $597,099 and $449,874, respectively.
In May 2013, CA Aldwych entered into a management agreement with a third party to operate a restaurant in the ME Hotel in London. Under this agreement, CA Aldwych shall receive a management fee equal to 5% of receipts received from F&B operations. In addition, CA Aldwych is entitled to receive a monthly marketing fee equal to 1.5% of receipts received F&B operations. Management fees amounted to $0 and $32,077 for the three months ended September 30, 2016 and 2015, respectively, and $20,485 and $72,442 for the nine months ended September 30, 2016 and 2015, respectively. Included in accounts receivable at September 30, 2016 and December 31, 2015 are amounts due for management fees of $6,218 and $74,546, respectively.
In June 2014, TOG (Milan) S.R.L. entered into a management agreement with Sol Melia Italia S.R.L. to operate a restaurant, rooftop bar and F&B services at the ME Milan Il Duca hotel in Milan, Italy. TOG (Milan) S.R.L. shall receive a management fee equal to 5% of operating revenue, as defined, and an additional fee equal to 65% of net operating revenue, as defined, for the life of the management agreement which expires in 2025. TOG Milan commenced operations in May 2015. In addition, TOG (Milan) S.R.L. is entitled to receive a monthly marketing fee equal to 1.5% of operating revenues. Management fees amounted to $111,070 and $154,241 for the three months ended September 30, 2016 and 2015, respectively, and $325,683 and $154,241 for the nine months ended September 30, 2016 and 2015, respectively. Included in accounts receivable and at September 30, 2016 and December 31, 2015 are amounts due for management fees of $313,092 and $116,342, respectively.
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