Quarterly report pursuant to Section 13 or 15(d)


Sep. 30, 2021
Dec. 31, 2020
Short-term Debt [Line Items]    
Total Debt $ 9,989,558 $ 6,916,601
Less: discount on convertible debt [1] (89,473) (223,681)
Total Debt, net of discount 9,900,085 6,692,920
Current portion of long-term debt 7,080,737 2,338,978
Long-term debt, less current portion 2,819,348 4,353,942
Notes Payable One [Member]    
Short-term Debt [Line Items]    
Total Debt [2] 25,850
Notes Payable Two [Member]    
Short-term Debt [Line Items]    
Total Debt [3] 27,048
Contractor Note [Member]    
Short-term Debt [Line Items]    
Total Debt [4] 348,269 348,269
PPP Loans [Member]    
Short-term Debt [Line Items]    
Total Debt [5] 4,109,400 2,109,400
United Kingdom Bounce Back Loan [Member]    
Short-term Debt [Line Items]    
Total Debt [6] 68,245
Economic Injury Disaster Loan [Member]    
Short-term Debt [Line Items]    
Total Debt [7] 300,000 299,900
Convertible Debt [Member]    
Short-term Debt [Line Items]    
Total Debt [1] 4,037,889 4,037,889
Convertible Promissory Note [Member]    
Short-term Debt [Line Items]    
Total Debt [8] 1,194,000
Promissory Note [Member]    
Short-term Debt [Line Items]    
Accounts payable and accrued expenses $ 95,000 $ 95,000
[1] On April 1, 2020, pursuant to an agreement among Chanticleer, Oz Rey and certain original holders of the 8% non-convertible debentures previously outstanding, the Company issued a 10% secured convertible debenture to Oz Rey in exchange for the 8% non-convertible debentures. The principal amount of the 10% secured convertible debenture is $4,037,889, 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. Interest is payable quarterly in cash. Prior to August 17, 2020, the 10% secured convertible debenture was convertible at any time by Oz Rey into common stock at the lower of $0.10 per share and the volume weighted average price on the last 10 trading days immediately prior to conversion. The 10% secured convertible debenture is also subject to adjustment if Amergent sells securities below this price (down round protection), among other triggers.
[2] In connection with the assets acquired from the two BGR franchisees, the Company entered into notes payable of $9,600 and $187,000 during 2018. The notes bore interest at 4% and were due within 12 months of each acquisition date. Principal and interest payments were due monthly and were fully repaid in 2021.
[3] During September 2019 and October 2019, the Company entered into two merchant capital advances in the amount of $46,000 and $84,700, respectively. The Company agreed to repay these advances through daily payments until those amounts were repaid with the specified interest rate per those agreements. These notes were fully repaid in 2021.
[4] The Company entered into a promissory note to repay a contractor for the build-out of a new Little Big Burger location. The note has a balance of $348,269, and a stated interest rate of 12% per year. In connection with and prior to the Merger and Spin-Off, on April 1, 2020, this note was assumed by Amergent. The Company is currently in default on this loan and a writ of garnishment was ordered against the Company in 2020 for approximately $445,000. The additional $95,000 is included in accounts payable and accrued expenses at September 30, 2021 and December 31, 2020.
[5] On April 27, 2020, Amergent received a $2.1 million loan under the first round of the Payment Protection Program (PPP Loan). The note bears interest at 1% per year, matures in April 2022, and requires monthly interest and principal payments of approximately $119,000 beginning in November 2020 and through maturity. The currently issued guidelines of the program allow for the loan proceeds to be forgiven if certain requirements are met. Any loan proceeds not forgiven will be repaid in full. The Company has currently applied for loan forgiveness in the full amount of the loan, but no assurance can be given as to the amount, if any, of forgiveness. The application for forgiveness allowed the Company to defer the timing of repayment until the forgiveness assessment is completed. See Note 11 for additional information.
[6] On November 24, 2020, Amergent received approximately $68,200 through the Bounce Back Loan Scheme in the United Kingdom. The loan has a term of six years that can be extended to 10 years. No payments are required and no interest is accrued for the first twelve months after the loan is received. After the first year, the loan accrues interest at 2.5% per year. The note has been reclassified to noncurrent assets held for sale at September 30, 2021 (see note 14).
[7] On August 4, 2020, the Company obtained two loans under the Economic Injury Disaster Loan (“EIDL”) assistance program from the Small Business Administration (“SBA”) in light of the impact of the COVID-19 pandemic on the Company’s business. The principal amount of the loans is $300,000, with proceeds to be used for working capital purposes. Interest accrues at the rate of 3.75% per year. Total installment payments, including principal and interest, are due monthly beginning August 4, 2021 in the amount of $1,762. The balance of principal and interest is payable over the next thirty years from the date of the promissory note (August 2050). There are no penalties for prepayment. Based upon guidance issued by the SBA on June 19, 2020, the EIDL loans are not required to be refinanced by the PPP Loan.
[8] On August 30, 2021, the Company purchased all of the outstanding membership interests in Squared Holdings pursuant to a Unit Purchase Agreement (Purchase Agreement) (see note 3). The purchase price was an 8% secured, convertible promissory note with a face value of $1,000,000 and a fair value of $1,194,000. Interest on the note is due quarterly and $500,000 of principal is due on August 30, 2022, and any remaining unpaid amount is due on August 30, 2023.