Debt and Capital Leases

12 Months Ended

Sep. 30, 2015

Debt and Capital Leases:


		2015		2014
Notes payable with United Capital Business Lending with payments of principal and interest (6.7%) due monthly through April 2022. The loans are secured by the fixtures and equipment of the Company's Good Times Drive Thru restaurants		1,225		194
Note payable associated with the purchase of BDI and BDFD, due in full along with accrued interest of 3.25% in May 2016. The promissory note is secured by a pledge of the ownership of the two entities which own two of the acquired restaurants.		2,414		0
Capital signage leases with Yesco, LLC with payments of principal and interest (8%) due monthly		42		74
Notes payable with Ally Financial with payments of principal and interest (3.9% to 5%) due monthly. The loans are secured by vehicles		40		20
		3,721		288
Less current portion		(2,617	)	(69	)
Long term portion	$	1,104		$ 219

On July 30, 2014 Drive Thru entered into a Development Line Loan and Security Agreement with United Capital Business Lending (“Lender”), pursuant to which Lender agreed to loan Drive Thru up to $2,100,000 (the “Loan”) and entered into a Collateral Assignment of Franchise Agreements, Management Agreement and Partnership Interests with Lender. In addition, on July 30, 2014, the Company entered into a Guaranty Agreement (the “Guaranty Agreement”) with Lender, pursuant to which the Company guaranteed the repayment of the Loan. The Loan Agreement, Collateral Assignment, Notes (as defined below) and Guaranty Agreement are referred to herein as the “Loan Documents.” As of September 30, 2015, Drive Thru had borrowed approximately $1,314,000 under the Loan Agreement, of which $1,118,000 was borrowed during the twelve month period ended September 30, 2015. As of July 1, 2015 Drive Thru could no longer request additional draw downs.

In connection with each disbursement under the Loan Agreement, Drive Thru executed a Promissory Note (the “Notes”) in the full amount of each disbursement request. The Notes incur interest at a rate of 6.69% per annum, are repayable in monthly installments of principal and interest over 84 months, and contain other customary terms and conditions. The Notes are subject to certain prepayment fees ranging between 1% and 3% of the unpaid balance at such time if Drive Thru repays a Note in certain circumstances prior to the thirty seventh monthly installment under such Note.

The Loan Agreement and Notes contain customary representations, warranties and affirmative and negative covenants, including without limitation, annual covenants to maintain certain insurance coverage and to maintain a certain debt service coverage ratio, leverage ratio, and quick ratio. At September 30, 2015 the company was in compliance with all the required covenants.

In May 2015, in connection with the BDI purchase, the Company entered into a one-year secured promissory note bearing interest at 3.25% in the amount of $2,414,000, as described in Note 2.

As of September 30, 2015, principal payments on debt become due as follows:


Years Ending September 30,
2016	$	2,617
2017		188
2018		189
2019		202
2020		209
Thereafter		316
	$	3,721

Total interest expense on notes payable and capital leases was $93,000 and $9,000 for fiscal 2015 and fiscal 2014, respectively.