Amergent Hospitality Group, Inc. Quarterly report pursuant to Section 13 or 15(d)

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 is payable in full on April 1, 2024, subject to extension by the holders in two-year intervals for up to 10 years from the issuance date upon Amergent meeting certain conditions.

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, which has been recorded as a debt discount and is being amortized over the two-year term of the related debt.

8% Non-convertible Secured Debentures [Member]

Short-Term Debt [Line Items]

Debt to purchase common shares

2,925,200

Expire years

10 years

Conversion price

$ 0.10

8% Non-convertible Secured Debentures [Member] | Warrant One [Member]

Short-Term Debt [Line Items]

Exercise price of warrants or rights

$ 0.125

Number of securities called by each warrant or right

2,462,600

8% Non-convertible Secured Debentures [Member] | Warrant Two [Member]

Short-Term Debt [Line Items]

Exercise price of warrants or rights

$ 0.50

Number of securities called by each warrant or right

462,500

10% Convertible Notes [Member]

Short-Term Debt [Line Items]

Debt discount

$ 400

8% Convertible Debt [Member]

Short-Term Debt [Line Items]

Debt instrument description

Both the notes and the warrants include a beneficial ownership blocker of 4.99% and contain customary provisions preventing dilution and providing the holders rights in the event of fundamental transactions. Upon the earlier of the maturity date or the one-year anniversary of conversion of the 8% Convertible Debt, holders of 51% of the registerable securities may request the Company to file a registration statement for the securities.

Expire years

5 years

Conversion price

$ 0.40

Conversion of stock shares converted

3,000,000

Private placement

$ 3,000

Number of common stock issued debt

$ 1,350

Exercise price

$ 0.50

Debt instrument conversion

3,375,000,000

Allocation value, warrants

$ 1,000

Debt instrument, term

18 months

8% Convertible Debt [Member] | Warrant [Member]

Short-Term Debt [Line Items]

Allocation value, warrants

$ 300

Debt discount

$ 300

PPP Loan [Member]

Short-Term Debt [Line Items]

Debt interest rate

1.00%

Debt payments

$ 45,000

$ 100

Proceeds from loan

$ 2,000

$ 2,100

Debt maturity

Feb. 25, 2026

EIDL Loans [Member]

Short-Term Debt [Line Items]

Debt face amount

$ 300

Debt interest rate

3.75%

Debt payments

$ 1,462

Promissory Note [Member]

Short-Term Debt [Line Items]

Debt interest rate

12.00%

Loan defendant

$ 400

Accounts payable and accrued expenses

$ 100

Notes Payable [Member]

Short-Term Debt [Line Items]

Debt instrument, term

270 days

Debt interest rate

13.20%

Implied interest rate

15.00%

[1]

In March 2022, the Company commenced a private placement of up to $3.0 million of 8% senior unsecured convertible debentures (the “8% Convertible Debt”) and 3,000,000 common stock warrants. Pursuant to the Securities Purchase Agreement, the Company issued $1.35 million of 8% Convertible Debt and warrants to purchase the number of shares of the Company’s common stock equal to the principal amount of 8% Convertible Debt issued.