COMMITMENTS AND CONTINGENCIES

12 Months Ended

8 Months Ended

Dec. 31, 2013

Dec. 31, 2013

Bourbon Brothers Holding Company LLC [Member]

COMMITMENTS AND CONTINGENCIES

NOTE 6 - COMMITMENTS AND CONTINGENCIES

Commitments:

Franchise agreement

The Company operates its Denver restaurant property under a franchise agreement with the Franchisor under an initial ten-year term, renewable for two additional five-year terms. Pursuant to the franchise agreement, the Company is to pay royalty fees based on a percentage of gross revenues (generally between 3% and 5% of gross sales, as defined), plus additional fees and costs for marketing, training, inventory and other franchisor costs. Two officers of the Company have personally guaranteed royalty payments to the Franchisor.

In September 2013, the Company amended the Franchise Agreement with the Franchisor. The amendment resulted in a reduction in the royalty fees for the Company's Denver restaurant to be paid to the Franchisor beginning January 1, 2014. The reduced rate is 2.5% of gross sales, subject to a monthly floor of $5,000.

For the years ended December 31, 2013 and 2012, the Company incurred franchise royalty expense of $98,000 and $0, respectively.

Leases:

In April 2012, the Company entered into a ten-year, non-cancellable lease for the restaurant in Denver, Colorado. This lease provides for two, five-year renewal options. Rent payments are approximately $16,000 per month plus certain common area maintenance charges, as defined, and are subject to escalation provisions.  Lease expense was approximately $190,000 and $144,800 for the years ended December 31, 2013 and 2012, respectively.  In addition, BBHCLLC has entered into a ten-year, non-cancellable lease with a related party for the restaurant in Colorado Springs, Colorado.

The future minimum lease payments are as follows:

	Third		Related
	Party		Party		Total
2014	$	194,120	$	367,039	$	561,159
2015		199,944		385,000		584,944
2016		205,942		385,000		590,942
2017		212,120		385,000		597,120
2018		218,484		385,000		603,484
Thereafter		857,884		2,135,461		2,993,345
	$	1,888,494	$	4,042,500	$	5,930,994

The Company also paid rent and rent-related expenses to Accredited Members Acquisition Corporation ("AMAC"), a related party (Note 9), on a month-to-month basis for office space at the AMAC corporate headquarters in Colorado Springs, Colorado. This arrangement began in October 2011 and terminated July 31, 2013, as the Management Service Agreement terminated. Base rental payments were approximately $3,500 per month. Related party rent expense was approximately $25,545 and $44,300 for the years ended December 31, 2013 and 2012, respectively.

During the year ended December 31, 2013, the Company and its general contractor were in a dispute regarding the final payment on the leasehold improvements on the restaurant. The general contractor recorded a lien against the premises. This lien caused the Company to be in default of its lease agreement. In July 2013, the Company and its landlord entered into an agreement to satisfy the dispute with the general contractor so the full lien will be released.  In turn, the entire lien was released on August 2, 2013.  The Company made payments totaling $144,000 in full for the year ended December 31, 2013.

Contingencies:

From time to time, the Company may become party to litigation and other claims in the ordinary course of business. To the extent that such claims and litigation arise, management provides for them if upon the advice of counsel, losses are determined to be both probable and estimable.

NOTE 5 - COMMITMENTS

Supplier agreement

The Company has contracted with a supplier to design the kitchen and provide equipment for the restaurant in Colorado Springs, Colorado.  This contract was paid in full as the Company paid approximately $325,800 as of December 31, 2013, to complete the contract.