INVESTMENT IN UNCONSOLIDATED INVESTEES

9 Months Ended

Sep. 30, 2017

Equity Method Investments and Joint Ventures [Abstract]

INVESTMENT IN UNCONSOLIDATED INVESTEES

NOTE 4. INVESTMENT IN UNCONSOLIDATED INVESTEES

Investments in unconsolidated investees in which we have a 20% to 50% interest or otherwise exercise significant influence are carried at cost and adjusted for the Company’s proportionate share of their undistributed earnings or losses under the equity method of accounting.

Investments in unconsolidated investees consist of the following:

	Percentage ownership as of
	September 30, 2017			September 30, 2016
Gruppa Florentina, LLC		20.00	%		20.00	%

Gruppa Florentina, LLC is the sole shareholder of Milano Restaurants International Corporation, (“Milano”) which operates 33 pizza parlors under the trade name “Me-N-Ed’s Pizza Parlors” and four pizza parlors operating under the trade name “Blast 825 Pizza,” located primarily in Central and Northern California. Milano has a 100% ownership interest in Siena Corp, which operates two grills under the trade names “Me-N-Ed’s Victory Grill” and “Me-N-Ed’s Coney Island Grill.” Milano has a 100% ownership interest in Piazza del Pane, Inc., which operates two restaurants located in Central California. Milano also has 23 franchised locations, including two operating, under the trade name Angelo & Vito’s Pizzerias.

The following is a summary of the financial position and results of operations from our investees (dollars in thousands):

As of September 30,	2017			2016
Real estate, net of accumulated depreciation	$	13,471		$	13,582
Notes receivable		10,065			9,359
Other assets		29,745			30,332
Notes payable		(9,226	)		(10,231	)
Other liabilities		(7,509	)		(7,372	)
Shareholders’ equity		(36,546	)		(35,670	)
For the Nine Months Ended September 30,	2017			2016
Revenue	$	36,451		$	40,598
Depreciation		(792	)		(863	)
Operating expenses		(34,641	)		(37,215	)
Interest expense		(475	)		(602	)
Net income	$	543		$	1,918
Company’s proportionate share of earnings	$	109		$	384