XML 80 R18.htm IDEA: XBRL DOCUMENT
v3.20.1

Note L - Leases | 12 Months Ended
--- | ---
Mar. 29, 2020
Notes to Financial Statements |
Leases, Disclosure [Text Block] | NOTE L - LEASES The Company is party as lessee to various leases for its Company-operated restaurants and lessee/sublessor to one franchised location property, including land and buildings, as well as leases for its corporate office and certain office equipment. Determination of Whether a Contract Contains a Lease We determine if an arrangement is a lease at inception or modification of a contract, and classify each lease as either an operating or finance lease at commencement. The Company only reassesses lease classification subsequent to commencement upon a change to the expected lease term or the contract being modified. Operating leases represent the Company’s right to use an underlying asset as lessee for the lease term, and lease obligations represent the Company’s obligation to make lease payments arising from the lease. A contract contains a lease if the contract conveys the right to control the use of the identified property, plant or equipment for a period of time in exchange for consideration. At commencement, contracts containing a lease are further evaluated for classification as an operating lease or finance lease where the Company is a lessee, or as an operating, sales-type or direct financing lease where the Company is a lessor, based on their terms. ROU Model and Determination of Lease Term The Company uses the ROU model to account for leases where the Company is the lessee, which requires an entity to recognize a lease liability and ROU asset on the lease commencement date. A lease liability is measured equal to the present value of the remaining lease payments over the lease term and is discounted using the incremental borrowing rate, as the rate implicit in the Company’s leases is not readily determinable. The incremental borrowing rate is the rate of interest that the Company would have to pay to borrow, on a collateralized basis over a similar term, an amount equal to the lease payments in a similar economic environment. Lease payments include payments made before the commencement date and any residual value guarantees, if applicable. The initial ROU asset consists of the initial measurement of the lease liability, adjusted for any payments made before the commencement date, initial direct costs and lease incentives earned. When determining the lease term, as both lessee and lessor, the Company includes option periods when it is reasonably certain that those options will be exercised. Operating leases For operating leases, minimum lease payments or receipts, including minimum scheduled rent increases, are recognized as rent expense where the Company is a lessee, or income where the Company is a lessor, as applicable, on a straight-line basis (“Straight-Line Rent”) over the applicable lease terms. There is a period under certain lease agreements referred to as a rent holiday (“Rent Holiday”) that generally begins on the possession date and ends on the rent commencement date. During a Rent Holiday, no cash rent payments are typically due under the terms of the lease; however, rent expense is recorded for that period on a straight-line basis. The excess of the Straight-Line Rent over the minimum rents paid is included in the ROU asset where the Company is a lessee. The excess of the Straight-Line Rent over the minimum rents received is recorded as a deferred lease asset and is included in “Other Assets” where the Company is a lessor. The Company recorded $32 in Other Assets at March 29, 2020. Certain leases contain provisions, referred to as contingent rent (“Contingent Rent”), that require additional rental payments based upon restaurant sales volume. Contingent Rent is recognized each period as the liability is incurred or the asset is earned. Lease cost for operating leases is recognized on a straight-line basis and includes the amortization of the ROU asset and interest expense relating to the operating lease liability. Variable lease cost for operating leases include Contingent Rent and payments for executory costs such as real estate taxes, insurance and common area maintenance, which are excluded from the measurement of the lease liability. Short-term lease cost for operating leases includes rental expense for leases with a term of less than 12 months. Leases with an initial expected term of 12 months or less are not recorded in the Consolidated Balance Sheets and the related lease expense is recognized on a straight-line basis over the lease term. Lease costs are recorded in the Consolidated Statements of Earnings based on the nature of the underlying lease as follows: ( 1 ) rental expense related to leases for Company-operated restaurants is recorded to “Restaurant Operating Expenses,” ( 2 ) rental expense for leased properties that are subsequently subleased to franchisees is recorded to “Other income, net” and ( 3 ) rental expense related to leases for corporate offices and equipment is recorded to “General and administrative expenses.” Rental income for operating leases on properties subleased to franchisees is recorded to “Other income, net.” Significant Assumptions and Judgement Management makes certain estimates and assumptions regarding each new lease and sublease agreement, renewal and amendment, including, but not limited to, property values, market rents, property lives, discount rates and probable term, all of which can impact ( 1 ) the classification and accounting for a lease or sublease as operating or finance, ( 2 ) the Rent Holiday and escalations in payment that are taken into consideration when calculating Straight-Line Rent, ( 3 ) the term over which leasehold improvements for each restaurant are amortized and ( 4 ) the values and lives of adjustments to the initial ROU asset where the Company is the lessee, or favorable and unfavorable leases where the Company is the lessor. The amount of depreciation and amortization, interest and rent expense and income would vary if different estimates and assumptions were used. Company as lessee The components of the net lease cost for the fiscal year ended March 29, 2020 were as follows (in thousands):
|  | Fi s cal year ended |
|  | March 2 9 , 2020 |
Statement of Earnings |  |  |  |
Operating lease cost |  | $ | 1,238 |
Short term lease cost |  |  | 17 |
Variable lease cost |  |  | 1,517 |
Less: Sublease income, net |  |  | (85 | )
Total net lease cost (a) |  | $ | 2,687 |
| (a) | Includes $2,137, net recorded to “Restaurant Operating Expenses” for leases for Company-operated restaurants, $635 recorded to “General and administrative expenses” for leases for corporate offices and equipment and $85 recorded to “Other income, net” for leased properties that are leased to franchisees:
Cash paid for amounts included in the measurement of lease liabilities were as follows (in thousands):
|  | F iscal year ended |
|  | March 29, 20 20 |
Operating cash flows from operating leases |  | $ | 375 |
On November 29, 2019, the Company entered into an amendment to its lease agreement for its Coney Island Boardwalk restaurant, commencing on December 1, 2019 ( the “Renewal Commencement Date”), extending the term for an additional eight ( 8 ) years, expiring November 30, 2027. The Company recorded an operating lease asset and liability of $1,911 on the Renewal Commencement date. The weighted average remaining lease term and weighted-average discount rate for operating leases as of March 29, 2020 were as follows:
Weighted average remaining lease term (years): |  |  |  |
Operating leases |  |  | 8.1 |
Weighted average discount rate: |  |  |  |
Operating leases |  |  | 8.869 | %
Future lease commitments to be paid and received by the Company as of March 29, 2020 were as follows (in thousands):
|  | Payments |  |  | Receipts |  |  |  |  |
|  | Operating Leases |  |  | Subleases |  |  | Net Leases |
Fiscal year: |  |  |  |  |  |  |  |  |  |  |  |
2021 |  | $ | 1,583 |  |  | $ | 245 |  |  | $ | 1,338 |
2022 |  |  | 1,837 |  |  |  | 247 |  |  |  | 1,590 |
2023 |  |  | 1,849 |  |  |  | 168 |  |  |  | 1,681 |
2024 |  |  | 1,774 |  |  |  | 169 |  |  |  | 1,605 |
2025 |  |  | 1,678 |  |  |  | 169 |  |  |  | 1,509 |
Thereafter |  |  | 5,474 |  |  |  | 352 |  |  |  | 5,122 |
Total lease commitments |  | $ | 14,195 |  |  | $ | 1,350 |  |  | $ | 12,845 |
Less: Amount representing interest |  |  | 4,080 |  |  |  |  |  |  |  |  |
Present value of lease liabilities (a) |  | $ | 10,115 |  |  |  |  |  |  |  |  |
| (a) | The present value of minimum operating lease payments of $1,583 and $8,532 are included in “Current portion of operating lease liabilities” and “Long-term operating lease liabilities,” respectively.
Company as lessor The components of lease income for the fiscal year ended March 29, 2020 were as follows (in thousands):
|  | Fi s cal year ended |
|  | March 29, 20 20 |
Operating lease income, net |  | $ | 84 |

X
- Definition The entire disclosure for leases of both the lessee and lessor. + References No definition available. + Details
Name: | nath_LeasesDisclosureTextBlock
Namespace Prefix: | nath_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_DisclosureTextBlockAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration