XML 45 R18.htm IDEA: XBRL DOCUMENT
v3.22.4

Leases | 12 Months Ended
--- | ---
Dec. 28, 2022
Leases [Abstract] |
Leases | Leases Lessee Our operations utilize property, facilities and equipment leased from others. Buildings and facilities are primarily used for restaurants and support facilities. Many of our restaurants are operated under lease arrangements which generally provide for a fixed base rent, and, in many instances, contingent rent based on a percentage of gross revenues. Initial terms of land and restaurant building leases generally range from 10 to 20 years, exclusive of options to renew, which are typically for five year periods. Leases of equipment consist primarily of restaurant equipment, computer equipment and vehicles. Initial terms of equipment leases generally range from three to five years. Lessor We lease or sublease certain restaurant properties to our franchisees and occasionally to third parties. The lease descriptions, terms, variable lease payments and renewal options are generally the same as the lessee leases described above. The components of lease costs were as follows:
|  |  | Fiscal Year Ended
| Classification |  | December 28, 2022 |  | December 29, 2021
|  |  | (In thousands)
Lease costs |  |  |  |  |
Finance lease costs: |  |  |  |  |
Amortization of right-of-use assets | Depreciation and amortization |  | $ | 1,704 |  |  | $ | 1,895 |
Interest on lease liabilities | Interest expense, net |  | 2,350 |  |  | 2,960 |
Operating lease costs: |  |  |  |  |
Operating lease costs - company | Occupancy |  | 7,624 |  |  | 6,394 |
Operating lease costs - franchise | Costs of franchise and license revenue |  | 15,541 |  |  | 17,106 |
Operating lease costs - general and administrative | General and administrative expenses |  | 564 |  |  | 432 |
Operating lease costs - closed stores | Restructuring charges and exit costs |  | 201 |  |  | 356 |
Variable lease costs: |  |  |  |  |
Variable lease costs - company | Occupancy |  | 3,988 |  |  | 3,275 |
Variable lease costs - franchise | Costs of franchise and license revenue |  | 6,596 |  |  | 7,172 |
Variable lease costs - general and administrative | General and administrative expenses |  | 255 |  |  | 218 |
Variable lease costs - closed stores | Restructuring charges and exit costs |  | 34 |  |  | 48 |
Sublease income: |  |  |  |  |
Sublease income - franchise | Franchise and license revenue |  | (27,445) |  |  | (30,607) |
Sublease income - closed stores | Restructuring charges and exit costs |  | (229) |  |  | (160) |
Total lease costs |  |  | $ | 11,183 |  |  | $ | 9,089 |
Lease terms and discount rates were as follows:
| December 28, 2022 |  | December 29, 2021
Weighted-average remaining lease term (in years): |  |  |
Finance leases | 8.4 |  | 8.5
Operating leases | 9.4 |  | 10.0
Weighted-average discount rate: |  |  |
Finance leases | 23.5 | % |  | 23.4 | %
Operating leases | 5.8 | % |  | 5.7 | %
The components of lease income were as follows:
|  |  | Fiscal Year Ended
| Classification |  | December 28, 2022 |  | December 29, 2021
|  |  | (In thousands)
Lease income |  |  |  |  |
Operating lease income - franchise | Franchise and license revenue |  | $ | 28,473 |  |  | $ | 30,767 |
Operating lease income - closed stores | Restructuring charges and exit costs |  | 183 |  |  | 109 |
Operating lease income - general and administrative | General and administrative expenses |  | 140 |  |  | 65 |
Variable lease income - franchise | Franchise and license revenue |  | 10,124 |  |  | 10,999 |
Variable lease income - closed stores | Restructuring charges and exit costs |  | 46 |  |  | 51 |
Total lease income |  |  | $ | 38,966 |  |  | $ | 41,991 |
Cash and supplemental noncash amounts were as follows:
|  | Fiscal Year Ended
|  | December 28, 2022 |  | December 29, 2021
|  | (In thousands)
Cash paid for amounts included in the measurement of lease liabilities: |  |  |  |
Operating cash flows from finance leases |  | $ | 2,350 |  |  | $ | 2,960 |
Operating cash flows from operating leases |  | $ | 24,626 |  |  | $ | 25,578 |
Financing cash flows from finance leases |  | $ | 2,020 |  |  | $ | 2,118 |
Right-of-use assets obtained in exchange for new finance lease liabilities |  | $ | 537 |  |  | $ | 998 |
Right-of-use assets obtained in exchange for new operating lease liabilities (1) |  | $ | 16,040 |  |  | $ | 8,513 |
(1) Right-of-use assets obtained in 2022 includes $7.9 million from the acquisition of Keke’s. See Note 3. Maturities of lease liabilities and receipts as of December 28, 2022 were as follows:
| Lease Liabilities |  | Lease Receipts
| Finance |  | Operating |  | Operating
| (In thousands)
2023 | $ | 3,768 |  |  | $ | 23,031 |  |  | $ | 25,816 |
2024 | 3,047 |  |  | 21,538 |  |  | 24,454 |
2025 | 2,911 |  |  | 20,267 |  |  | 24,220 |
2026 | 2,576 |  |  | 19,427 |  |  | 23,768 |
2027 | 2,197 |  |  | 17,525 |  |  | 22,195 |
Thereafter | 11,514 |  |  | 80,781 |  |  | 138,095 |
Total undiscounted cash flows | 26,013 |  |  | 182,569 |  |  | $ | 258,548 |
Less: interest | 14,775 |  |  | 43,855 |  |  |
Present value of lease liabilities | 11,238 |  |  | 138,714 |  |  |
Less: current lease liabilities | 1,683 |  |  | 15,310 |  |  |
Long-term lease liabilities | $ | 9,555 |  |  | $ | 123,404 |  |  |
Leases | Leases Lessee Our operations utilize property, facilities and equipment leased from others. Buildings and facilities are primarily used for restaurants and support facilities. Many of our restaurants are operated under lease arrangements which generally provide for a fixed base rent, and, in many instances, contingent rent based on a percentage of gross revenues. Initial terms of land and restaurant building leases generally range from 10 to 20 years, exclusive of options to renew, which are typically for five year periods. Leases of equipment consist primarily of restaurant equipment, computer equipment and vehicles. Initial terms of equipment leases generally range from three to five years. Lessor We lease or sublease certain restaurant properties to our franchisees and occasionally to third parties. The lease descriptions, terms, variable lease payments and renewal options are generally the same as the lessee leases described above. The components of lease costs were as follows:
|  |  | Fiscal Year Ended
| Classification |  | December 28, 2022 |  | December 29, 2021
|  |  | (In thousands)
Lease costs |  |  |  |  |
Finance lease costs: |  |  |  |  |
Amortization of right-of-use assets | Depreciation and amortization |  | $ | 1,704 |  |  | $ | 1,895 |
Interest on lease liabilities | Interest expense, net |  | 2,350 |  |  | 2,960 |
Operating lease costs: |  |  |  |  |
Operating lease costs - company | Occupancy |  | 7,624 |  |  | 6,394 |
Operating lease costs - franchise | Costs of franchise and license revenue |  | 15,541 |  |  | 17,106 |
Operating lease costs - general and administrative | General and administrative expenses |  | 564 |  |  | 432 |
Operating lease costs - closed stores | Restructuring charges and exit costs |  | 201 |  |  | 356 |
Variable lease costs: |  |  |  |  |
Variable lease costs - company | Occupancy |  | 3,988 |  |  | 3,275 |
Variable lease costs - franchise | Costs of franchise and license revenue |  | 6,596 |  |  | 7,172 |
Variable lease costs - general and administrative | General and administrative expenses |  | 255 |  |  | 218 |
Variable lease costs - closed stores | Restructuring charges and exit costs |  | 34 |  |  | 48 |
Sublease income: |  |  |  |  |
Sublease income - franchise | Franchise and license revenue |  | (27,445) |  |  | (30,607) |
Sublease income - closed stores | Restructuring charges and exit costs |  | (229) |  |  | (160) |
Total lease costs |  |  | $ | 11,183 |  |  | $ | 9,089 |
Lease terms and discount rates were as follows:
| December 28, 2022 |  | December 29, 2021
Weighted-average remaining lease term (in years): |  |  |
Finance leases | 8.4 |  | 8.5
Operating leases | 9.4 |  | 10.0
Weighted-average discount rate: |  |  |
Finance leases | 23.5 | % |  | 23.4 | %
Operating leases | 5.8 | % |  | 5.7 | %
The components of lease income were as follows:
|  |  | Fiscal Year Ended
| Classification |  | December 28, 2022 |  | December 29, 2021
|  |  | (In thousands)
Lease income |  |  |  |  |
Operating lease income - franchise | Franchise and license revenue |  | $ | 28,473 |  |  | $ | 30,767 |
Operating lease income - closed stores | Restructuring charges and exit costs |  | 183 |  |  | 109 |
Operating lease income - general and administrative | General and administrative expenses |  | 140 |  |  | 65 |
Variable lease income - franchise | Franchise and license revenue |  | 10,124 |  |  | 10,999 |
Variable lease income - closed stores | Restructuring charges and exit costs |  | 46 |  |  | 51 |
Total lease income |  |  | $ | 38,966 |  |  | $ | 41,991 |
Cash and supplemental noncash amounts were as follows:
|  | Fiscal Year Ended
|  | December 28, 2022 |  | December 29, 2021
|  | (In thousands)
Cash paid for amounts included in the measurement of lease liabilities: |  |  |  |
Operating cash flows from finance leases |  | $ | 2,350 |  |  | $ | 2,960 |
Operating cash flows from operating leases |  | $ | 24,626 |  |  | $ | 25,578 |
Financing cash flows from finance leases |  | $ | 2,020 |  |  | $ | 2,118 |
Right-of-use assets obtained in exchange for new finance lease liabilities |  | $ | 537 |  |  | $ | 998 |
Right-of-use assets obtained in exchange for new operating lease liabilities (1) |  | $ | 16,040 |  |  | $ | 8,513 |
(1) Right-of-use assets obtained in 2022 includes $7.9 million from the acquisition of Keke’s. See Note 3. Maturities of lease liabilities and receipts as of December 28, 2022 were as follows:
| Lease Liabilities |  | Lease Receipts
| Finance |  | Operating |  | Operating
| (In thousands)
2023 | $ | 3,768 |  |  | $ | 23,031 |  |  | $ | 25,816 |
2024 | 3,047 |  |  | 21,538 |  |  | 24,454 |
2025 | 2,911 |  |  | 20,267 |  |  | 24,220 |
2026 | 2,576 |  |  | 19,427 |  |  | 23,768 |
2027 | 2,197 |  |  | 17,525 |  |  | 22,195 |
Thereafter | 11,514 |  |  | 80,781 |  |  | 138,095 |
Total undiscounted cash flows | 26,013 |  |  | 182,569 |  |  | $ | 258,548 |
Less: interest | 14,775 |  |  | 43,855 |  |  |
Present value of lease liabilities | 11,238 |  |  | 138,714 |  |  |
Less: current lease liabilities | 1,683 |  |  | 15,310 |  |  |
Long-term lease liabilities | $ | 9,555 |  |  | $ | 123,404 |  |  |
Leases | Leases Lessee Our operations utilize property, facilities and equipment leased from others. Buildings and facilities are primarily used for restaurants and support facilities. Many of our restaurants are operated under lease arrangements which generally provide for a fixed base rent, and, in many instances, contingent rent based on a percentage of gross revenues. Initial terms of land and restaurant building leases generally range from 10 to 20 years, exclusive of options to renew, which are typically for five year periods. Leases of equipment consist primarily of restaurant equipment, computer equipment and vehicles. Initial terms of equipment leases generally range from three to five years. Lessor We lease or sublease certain restaurant properties to our franchisees and occasionally to third parties. The lease descriptions, terms, variable lease payments and renewal options are generally the same as the lessee leases described above. The components of lease costs were as follows:
|  |  | Fiscal Year Ended
| Classification |  | December 28, 2022 |  | December 29, 2021
|  |  | (In thousands)
Lease costs |  |  |  |  |
Finance lease costs: |  |  |  |  |
Amortization of right-of-use assets | Depreciation and amortization |  | $ | 1,704 |  |  | $ | 1,895 |
Interest on lease liabilities | Interest expense, net |  | 2,350 |  |  | 2,960 |
Operating lease costs: |  |  |  |  |
Operating lease costs - company | Occupancy |  | 7,624 |  |  | 6,394 |
Operating lease costs - franchise | Costs of franchise and license revenue |  | 15,541 |  |  | 17,106 |
Operating lease costs - general and administrative | General and administrative expenses |  | 564 |  |  | 432 |
Operating lease costs - closed stores | Restructuring charges and exit costs |  | 201 |  |  | 356 |
Variable lease costs: |  |  |  |  |
Variable lease costs - company | Occupancy |  | 3,988 |  |  | 3,275 |
Variable lease costs - franchise | Costs of franchise and license revenue |  | 6,596 |  |  | 7,172 |
Variable lease costs - general and administrative | General and administrative expenses |  | 255 |  |  | 218 |
Variable lease costs - closed stores | Restructuring charges and exit costs |  | 34 |  |  | 48 |
Sublease income: |  |  |  |  |
Sublease income - franchise | Franchise and license revenue |  | (27,445) |  |  | (30,607) |
Sublease income - closed stores | Restructuring charges and exit costs |  | (229) |  |  | (160) |
Total lease costs |  |  | $ | 11,183 |  |  | $ | 9,089 |
Lease terms and discount rates were as follows:
| December 28, 2022 |  | December 29, 2021
Weighted-average remaining lease term (in years): |  |  |
Finance leases | 8.4 |  | 8.5
Operating leases | 9.4 |  | 10.0
Weighted-average discount rate: |  |  |
Finance leases | 23.5 | % |  | 23.4 | %
Operating leases | 5.8 | % |  | 5.7 | %
The components of lease income were as follows:
|  |  | Fiscal Year Ended
| Classification |  | December 28, 2022 |  | December 29, 2021
|  |  | (In thousands)
Lease income |  |  |  |  |
Operating lease income - franchise | Franchise and license revenue |  | $ | 28,473 |  |  | $ | 30,767 |
Operating lease income - closed stores | Restructuring charges and exit costs |  | 183 |  |  | 109 |
Operating lease income - general and administrative | General and administrative expenses |  | 140 |  |  | 65 |
Variable lease income - franchise | Franchise and license revenue |  | 10,124 |  |  | 10,999 |
Variable lease income - closed stores | Restructuring charges and exit costs |  | 46 |  |  | 51 |
Total lease income |  |  | $ | 38,966 |  |  | $ | 41,991 |
Cash and supplemental noncash amounts were as follows:
|  | Fiscal Year Ended
|  | December 28, 2022 |  | December 29, 2021
|  | (In thousands)
Cash paid for amounts included in the measurement of lease liabilities: |  |  |  |
Operating cash flows from finance leases |  | $ | 2,350 |  |  | $ | 2,960 |
Operating cash flows from operating leases |  | $ | 24,626 |  |  | $ | 25,578 |
Financing cash flows from finance leases |  | $ | 2,020 |  |  | $ | 2,118 |
Right-of-use assets obtained in exchange for new finance lease liabilities |  | $ | 537 |  |  | $ | 998 |
Right-of-use assets obtained in exchange for new operating lease liabilities (1) |  | $ | 16,040 |  |  | $ | 8,513 |
(1) Right-of-use assets obtained in 2022 includes $7.9 million from the acquisition of Keke’s. See Note 3. Maturities of lease liabilities and receipts as of December 28, 2022 were as follows:
| Lease Liabilities |  | Lease Receipts
| Finance |  | Operating |  | Operating
| (In thousands)
2023 | $ | 3,768 |  |  | $ | 23,031 |  |  | $ | 25,816 |
2024 | 3,047 |  |  | 21,538 |  |  | 24,454 |
2025 | 2,911 |  |  | 20,267 |  |  | 24,220 |
2026 | 2,576 |  |  | 19,427 |  |  | 23,768 |
2027 | 2,197 |  |  | 17,525 |  |  | 22,195 |
Thereafter | 11,514 |  |  | 80,781 |  |  | 138,095 |
Total undiscounted cash flows | 26,013 |  |  | 182,569 |  |  | $ | 258,548 |
Less: interest | 14,775 |  |  | 43,855 |  |  |
Present value of lease liabilities | 11,238 |  |  | 138,714 |  |  |
Less: current lease liabilities | 1,683 |  |  | 15,310 |  |  |
Long-term lease liabilities | $ | 9,555 |  |  | $ | 123,404 |  |  |

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

X
- Definition The entire disclosure for finance leases of lessee. Includes, but is not limited to, description of lessee's finance lease and maturity analysis of finance lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -URI https://asc.fasb.org/subtopic&trid=77888251 + Details
Name: | us-gaap_LesseeFinanceLeasesTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -URI https://asc.fasb.org/subtopic&trid=77888251 + Details
Name: | us-gaap_LesseeOperatingLeasesTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for lessor's operating leases. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 30 -URI https://asc.fasb.org/subtopic&trid=77888252 + Details
Name: | us-gaap_OperatingLeasesOfLessorDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration