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CONTINGENCIES
3 Months Ended
Sep. 27, 2017
Commitments and Contingencies Disclosure [Abstract]  
CONTINGENCIES
CONTINGENCIES
In connection with the sale of restaurants to franchisees and brand divestitures, we have, in certain cases, guaranteed lease payments. As of September 27, 2017 and June 28, 2017, we have outstanding lease guarantees or are secondarily liable for $63.1 million and $69.0 million, respectively. These amounts represent the maximum potential liability of future payments under the guarantees. These leases have been assigned to the buyers and expire at the end of the respective lease terms, which range from fiscal 2018 through fiscal 2027. In the event of default, the indemnity and default clauses in our assignment agreements govern our ability to pursue and recover damages incurred.

In July 2017, subsequent to the end of the fiscal year, we were notified that Mac Acquisition LLC, the owner of Romano’s Macaroni Grill restaurants, closed several of its properties for which we are secondarily liable. Based on management’s belief that Mac Acquisition LLC would default on the leases for these closed locations, a liability was established based on an estimate of the obligation associated with these locations of approximately $1.1 million in fiscal 2017.

In October 2017, Mac Acquisition LLC filed for Chapter 11 bankruptcy protection. We believe our liability for the previously closed restaurants remains appropriate. We will continue to monitor the bankruptcy proceedings to assess the likelihood of any incremental losses. Estimating a potential loss or range of loss related to the Romano's Macaroni Grill restaurants operating under bankruptcy protection is not possible at this time due to the shortage of available information and significant uncertainty regarding the outcome of the bankruptcy proceedings. We have not been informed by landlords of Mac Acquisition LLC of any lease defaults other than those relating to locations known to be closed in July 2017. No other liabilities have been recorded as of September 27, 2017.
We provide letters of credit to various insurers to collateralize obligations for outstanding claims. As of September 27, 2017, we had $31.0 million in undrawn standby letters of credit outstanding. All standby letters of credit are renewable annually.
Evaluating contingencies related to litigation is a complex process involving subjective judgment on the potential outcome of future events, and the ultimate resolution of litigated claims may differ from our current analysis. Accordingly, we review the adequacy of accruals and disclosures pertaining to litigated matters each quarter in consultation with legal counsel, and we assess the probability and range of possible losses associated with contingencies for potential accrual in the consolidated financial statements.
We are engaged in various legal proceedings and have certain unresolved claims pending. Liabilities have been established based on our best estimates of our potential liability in certain of these matters. Based upon consultation with legal counsel, management is of the opinion that there are no matters pending or threatened which are expected to have a material adverse effect, individually or in the aggregate, on our consolidated financial condition or results of operations.