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Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Jun. 24, 2020	Dec. 25, 2019
Current assets:
Cash and cash equivalents	$ 60,342	$ 8,070
Accounts and other receivables, net	16,115	8,505
Inventories	1,954	2,009
Prepaid expenses and other current assets	2,696	5,718
Income tax receivable		376
Total current assets	81,107	24,678
Property and equipment owned, net	84,262	91,778
Property held under operating leases, net ("ROU asset")	184,308	192,395
Goodwill	248,674	248,674
Trademarks	61,888	61,888
Deferred tax assets	4,185	3,709
Other assets	1,168	1,630
Total assets	665,592	624,752
Current liabilities:
Current portion of obligations under finance leases	37	34
Current portion of obligations under operating leases	17,979	16,406
Accounts payable	9,338	5,627
Accrued salaries and vacation	6,277	8,618
Accrued insurance	10,138	9,440
Accrued income taxes payable	1,693
Accrued interest	217	302
Current portion of income tax receivable agreement payable	4,987	4,935
Other accrued expenses and current liabilities	16,376	28,597
Total current liabilities	67,042	73,959
Revolver loan	138,800	97,000
Obligations under finance leases, net of current portion	63	83
Obligations under operating leases, net of current portion	189,060	197,492
Deferred taxes	1,671	1,672
Income tax receivable agreement payable, net of current portion	3,419	3,301
Other noncurrent liabilities	8,978	5,679
Total liabilities	409,033	379,186
Commitments and contingencies
Stockholders' Equity
Preferred stock, $0.01 par value, 100,000,000 shares authorized; none issued or outstanding	0	0
Common stock, $0.01 par value, 200,000,000 shares authorized; 35,854,122 and 35,126,582 shares issued and outstanding	359	351
Additional paid-in-capital	334,088	330,950
Accumulated deficit	(76,889)	(85,988)
Accumulated other comprehensive (loss) income	(999)	253
Total stockholders' equity	256,559	245,566
Total liabilities and stockholders' equity	$ 665,592	$ 624,752

Condensed Consolidated Statements of Income (Unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 24, 2020	Jun. 26, 2019	Jun. 24, 2020	Jun. 26, 2019
Revenue
Total revenue	$ 99,604	$ 113,740	$ 204,767	$ 222,717
Cost of operations
Food and paper cost	22,873	27,886	48,435	55,038
Labor and related expenses	25,759	29,272	54,452	58,848
Occupancy and other operating expenses	21,922	23,032	44,031	46,259
Company restaurant expenses	70,554	80,190	146,918	160,145
General and administrative expenses	10,465	9,348	19,796	20,696
Franchise expenses	6,627	7,542	13,538	13,686
Depreciation and amortization	4,168	4,454	8,537	9,215
Loss on disposal of assets	27	134	127	178
Recovery of securities lawsuits related legal expenses and other insurance claims	(123)	(10,000)	(123)	(10,000)
Impairment and closed-store reserves	437	565	2,839	874
Loss on disposition of restaurants		927		5,051
Total expenses	92,155	93,160	191,632	199,845
Income from operations	7,449	20,580	13,135	22,872
Interest expense, net	908	922	1,813	1,781
Income tax receivable agreement expense (income)	290	(94)	170	77
Income before provision for income taxes	6,251	19,752	11,152	21,014
Provision for income taxes	752	5,665	2,053	6,014
Net income	$ 5,499	$ 14,087	$ 9,099	$ 15,000
Net income per share
Basic (usd per share)	$ 0.16	$ 0.37	$ 0.26	$ 0.39
Diluted (usd per share)	$ 0.16	$ 0.37	$ 0.26	$ 0.38
Weighted-average shares used in computing net income per share
Basic (shares)	34,836,410	37,939,912	34,747,785	38,296,807
Diluted (shares)	35,410,198	38,580,722	35,382,607	39,043,477
Company-operated restaurant revenue
Revenue
Total revenue	$ 87,707	$ 100,139	$ 180,341	$ 197,289
Franchise revenue
Revenue
Total revenue	6,719	7,918	13,781	14,362
Franchise advertising fee revenue
Revenue
Total revenue	$ 5,178	$ 5,683	$ 10,645	$ 11,066

Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited) - USD ($) $ in Thousands	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Accumulated Other Comprehensive Income (Loss)	Total
Beginning balance (shares) at Dec. 26, 2018	39,009,451
Beginning balance at Dec. 26, 2018	$ 390	$ 375,734	$ (110,888)		$ 265,236
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation		1,129			1,129
Issuance of common stock related to restricted stock	$ 3	(3)
Issuance of common stock related to restricted stock (shares)	301,371
Issuance of common stock upon exercise of stock options		80			80
Issuance of common stock upon exercise of stock options (shares)	6,709
Shares repurchased for employee tax withholdings	$ (1)	(294)			(295)
Shares repurchased for employee tax withholdings (shares)	(25,747)
Repurchase of common stock	$ (15)	(18,311)			(18,326)
Repurchase of common stock (shares)	(1,558,836)
Net income			15,000		15,000
Ending balance (shares) at Jun. 26, 2019	37,732,948
Ending balance at Jun. 26, 2019	$ 377	358,335	(95,888)		262,824
Beginning balance (shares) at Mar. 27, 2019	38,730,204
Beginning balance at Mar. 27, 2019	$ 388	372,825	(109,975)		263,238
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation		641			641
Issuance of common stock related to restricted stock	$ 3	(3)
Issuance of common stock related to restricted stock (shares)	323,489
Issuance of common stock upon exercise of stock options		80			80
Issuance of common stock upon exercise of stock options (shares)	6,709
Shares repurchased for employee tax withholdings	$ (1)	(278)			(279)
Shares repurchased for employee tax withholdings (shares)	(24,172)
Repurchase of common stock	$ (13)	(14,930)			(14,943)
Repurchase of common stock (shares)	(1,303,282)
Net income			14,087		14,087
Ending balance (shares) at Jun. 26, 2019	37,732,948
Ending balance at Jun. 26, 2019	$ 377	358,335	(95,888)		262,824
Beginning balance (shares) at Dec. 25, 2019	35,126,582
Beginning balance at Dec. 25, 2019	$ 351	330,950	(85,988)	$ 253	245,566
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation		1,261			1,261
Issuance of common stock related to restricted stock	$ 4	(4)
Issuance of common stock related to restricted stock (shares)	436,263
Issuance of common stock upon exercise of stock options	$ 4	2,161			$ 2,165
Issuance of common stock upon exercise of stock options (shares)	372,556				372,556
Shares repurchased for employee tax withholdings		(280)			$ (280)
Shares repurchased for employee tax withholdings (shares)	(20,193)
Forfeiture of common stock related to restricted shares	(61,086)				(73,497)
Other comprehensive loss, net of taxes				(1,252)	$ (1,252)
Net income			9,099		9,099
Ending balance (shares) at Jun. 24, 2020	35,854,122
Ending balance at Jun. 24, 2020	$ 359	334,088	(76,889)	(999)	256,559
Beginning balance (shares) at Mar. 25, 2020	35,089,983
Beginning balance at Mar. 25, 2020	$ 351	331,484	(82,388)	(842)	248,605
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation		727			727
Issuance of common stock related to restricted stock	$ 4	(4)
Issuance of common stock related to restricted stock (shares)	436,263
Issuance of common stock upon exercise of stock options	$ 4	2,161			2,165
Issuance of common stock upon exercise of stock options (shares)	372,556
Shares repurchased for employee tax withholdings		(280)			(280)
Shares repurchased for employee tax withholdings (shares)	(20,193)
Forfeiture of common stock related to restricted shares	(24,487)
Other comprehensive loss, net of taxes				(157)	(157)
Net income			5,499		5,499
Ending balance (shares) at Jun. 24, 2020	35,854,122
Ending balance at Jun. 24, 2020	$ 359	$ 334,088	$ (76,889)	$ (999)	$ 256,559

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 26, 2019	Jun. 24, 2020	Jun. 26, 2019
Cash flows from operating activities:
Net income	$ 14,087	$ 9,099	$ 15,000
Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation and amortization	4,454	8,537	9,215
Stock-based compensation expense	600	1,261	1,129
Income tax receivable agreement expense	(94)	170	77
Loss on disposition of restaurants	927		5,051
Loss on disposal of assets	134	127	178
Impairment of property and equipment	200	1,972	227
Amortization of deferred financing costs		126	126
Amortization of favorable and unfavorable leases, net			(362)
Deferred income taxes, net		(363)	5,799
Changes in operating assets and liabilities:
Accounts and other receivables, net		(7,610)	(2,084)
Inventories		55	277
Prepaid expenses and other current assets		3,021	(450)
Other assets		339	23
Accounts payable		3,610	1,057
Accrued salaries and vacation		(2,342)	(487)
Accrued insurance		698	1,163
Income taxes payable		2,069	(3)
Other accrued expenses and liabilities		(9,687)	(23,077)
Net cash flows provided by operating activities		11,082	12,859
Cash flows from investing activities:
Proceeds from disposition of restaurants			4,770
Purchase of property and equipment		(2,479)	(5,898)
Net cash flows used in investing activities		(2,479)	(1,128)
Cash flows from financing activities:
Minimum tax withholdings related to net share settlements		(280)	(295)
Payments on revolver and swingline loan		(10,700)	(15,000)
Borrowings on revolver and swingline loan		52,500	26,000
Proceeds from issuance of common stock upon exercise of stock options, net of expenses		2,165	80
Payment of obligations under finance leases		(16)	(53)
Stock buybacks			(18,151)
Net cash flows provided by (used in) financing activities		43,669	(7,419)
Increase in cash and cash equivalents		52,272	4,312
Cash cash equivalents beginning of period		8,070	6,969
Cash cash equivalents end of period	$ 11,281	60,342	11,281
Supplemental cash flow information
Cash paid during the period for interest		1,738	1,694
Cash paid during the period for income taxes		434	218
Unpaid purchases of property and equipment		$ 846	980
Unpaid stock buybacks			$ 310

Basis of Presentation and Summary of Significant Accounting Policies

6 Months Ended

Jun. 24, 2020

Accounting Policies [Abstract]

Basis of Presentation and Summary of Significant Accounting Policies

1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Overview

El Pollo Loco Holdings, Inc. (“Holdings”) is a Delaware corporation headquartered in Costa Mesa, California. Holdings and its direct and indirect subsidiaries are collectively referred to herein as “we,” “us” or the “Company.” The Company’s activities are conducted principally through its indirect wholly-owned subsidiary, El Pollo Loco, Inc. (“EPL”), which develops, franchises, licenses, and operates quick-service restaurants under the name El Pollo Loco® and operates under one operating segment. At June 24, 2020, the Company operated 196 and franchised 283 El Pollo Loco restaurants.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial statements and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments consisting of normal recurring adjustments necessary for a fair presentation of the Company’s consolidated financial position and results of operations and cash flows for the periods presented. Interim results of operations are not necessarily indicative of the results that may be achieved for the full year. The condensed consolidated financial statements and related notes do not include all information and footnotes required by GAAP for annual reports. This quarterly report should be read in conjunction with the consolidated financial statements included in the Company’s annual report on Form 10-K for the year ended December 25, 2019.

The Company uses a 52- or 53-week fiscal year ending on the last Wednesday of the calendar year. In a 52-week fiscal year, each quarter includes 13 weeks of operations; in a 53-week fiscal year, the first, second and third quarters each include 13 weeks of operations, and the fourth quarter includes 14 weeks of operations. Every six or seven years, a 53-week fiscal year occurs. Fiscal 2020 is a 53-week year ending on December 30, 2020, and fiscal 2019 was a 52-week year ending on December 25, 2019. Revenues, expenses, and other financial and operational figures may be elevated in a 53-week year.

Holdings has no material assets or operations. Holdings and Holdings’ direct subsidiary, EPL Intermediate, Inc. (“Intermediate”), guarantee EPL’s 2018 Revolver (as defined below) on a full and unconditional basis (see Note 4), and Intermediate has no subsidiaries other than EPL. EPL is a separate and distinct legal entity and has no obligation to make funds available to Intermediate. EPL and Intermediate may pay dividends to Intermediate and to Holdings, respectively, subject to the terms of the 2018 Revolver.

Principles of Consolidation

The accompanying condensed consolidated financial statements include the accounts of Holdings and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the condensed consolidated financial statements and revenue and expenses during the periods reported. Actual results could materially differ from those estimates. The Company’s significant estimates include estimates for impairment of goodwill, intangible assets and property and equipment, insurance reserves, lease accounting matters, stock-based compensation, income tax receivable agreement liability, contingent liabilities and income tax valuation allowances.

COVID-19

On January 30, 2020, the World Health Organization (“WHO”) announced a global health emergency because of a new strain of coronavirus originating in Wuhan, China ("COVID-19") and the risks to the international community as the virus spreads globally beyond its point of origin. On March 11, 2020, the WHO classified the COVID-19 outbreak as a pandemic, based on the rapid increase in exposure globally.

The COVID-19 pandemic has significantly disrupted consumer demand, as well as the Company’s restaurant operations. Following the pandemic declaration in March 2020, federal, state and local governments began to respond to the public health crisis by requiring social distancing, "stay at home" directives, and restaurant restrictions - including government-mandated dining room closures - that limited business to off-premise services only (take-out, drive-thru and delivery). Historically, approximately 20% of the Company’s sales are associated with dine-in service. In May 2020, the “stay at home” directive was modified in most areas in which the Company operates, allowing for the opening of lower-risk workplaces, including restaurants, but with restrictions such as limited capacity. However, in recent months a surge in the COVID-19 pandemic has caused many state and local governments to re-implement certain restrictions to try and contain the spread of the virus. Except for nine restaurants in Houston and one in Utah, all of the Company’s restaurants are operating on a take-away, mobile pick-up and delivery basis, as well as maintaining drive-thru operations where available, in order to protect its employees and customers from the spread of the COVID-19 pandemic and to comply with the government mandates. Due to the impact of the COVID-19 pandemic, during the thirteen and twenty-six weeks ended June 24, 2020, the Company has temporarily closed 31 restaurants, typically for one to three days, 30 of which have reopened and 1 remained closed as of June 24, 2020. Similarly, franchisees have temporarily closed 21 restaurants, of which 17 have reopened and four remain closed as of June 24, 2020. As of June 24, 2020, the Company had not permanently closed any restaurants due to the COVID-19 pandemic.

The full impact of the COVID-19 outbreak continues to evolve as of the date of this report. Management has taken precautionary actions, such as drawing on its 2018 Revolver (see Note 4), temporarily suspending all but essential capital spending and share repurchase activity, reevaluating essential support center general and administrative expenses and fine-tuning its restaurant labor model based on indoor dining room restrictions, limited dining room capacity in restaurants located in geographies where indoor dining is permitted, dining room closures and fluctuating sales volumes. Additionally, Management has delayed making April, May and June rent payments on the majority of its leased properties and has reached agreements for rent abatement and/or deferment with the Company’s landlords for those properties. See Note 5 “Other Accrued Expenses and Current Liabilities” and Note 6 “Other Noncurrent Liabilities” for details of these balances. For the Company’s franchisees, the Company deferred 50% of their April royalties as well as 100% of their 2020 remodel and new restaurant build requirements until 2021. Management is continually evaluating the impact of the global crisis on its financial condition, liquidity, operations, suppliers, industry, and workforce and will take additional actions as necessary. The disruption in operations led to the Company considering the impact of the COVID-19 pandemic on its liquidity, debt covenant compliance, and recoverability of long-lived and ROU assets, goodwill and intangible assets, among others. If these disruptions to the Company’s operations from the COVID-19 pandemic continue, they may have a material negative impact on the Company’s consolidated financial condition, future results of operations and liquidity. The extent of such negative impact will depend, in part, on the longevity and severity of the pandemic.

Due to the rapid development and fluidity of this situation, the Company cannot determine the ultimate impact that the COVID-19 pandemic will have on the Company’s consolidated financial condition, liquidity, and future results of operations, and therefore any prediction as to the ultimate materiality of the adverse impact on the Company’s consolidated financial condition, liquidity, and future results of operations is uncertain.

Subsequent Events

Subsequent to June 24, 2020, the Company has temporarily closed 36 restaurants, typically for one to three days, and franchisees have temporarily closed 11 restaurants. As of July 31, 2020, four company-operated and three franchise locations remained closed.

Subsequent to June 24, 2020, the Surety, from whom the Company procured an appeal bond to secure the judgement against the Company in the matter of Janice P. Handlers-Bryman and Michael D. Bryman v. El Pollo Loco, Inc., released its collateral demand, freeing the $2.7 million Letter of Credit previously issued in April 2020. Additionally,

subsequent to June 24, 2020, the Company reached an agreement in principle with the plaintiffs to resolve the lawsuit. See Note 7, “Commitments and Contingencies, Legal Matters” for more details.

The Company has evaluated subsequent events that have occurred after June 24, 2020, and determined that there were no other events or transactions occurring during this reporting period that require recognition or disclosure in the condensed consolidated financial statements.

Cash and Cash Equivalents

The Company considers all highly-liquid instruments with an original maturity of three months or less at the date of purchase to be cash equivalents.

Liquidity

The Company’s principal liquidity and capital requirements are new restaurants, existing restaurant capital investments (remodels and maintenance), interest payments on our debt, lease obligations and working capital and general corporate needs. At June 24, 2020, the Company’s total debt was $138.8 million. The Company’s ability to make payments on its indebtedness and to fund planned capital expenditures depends on available cash and its ability to generate adequate cash flows in the future, which, to a certain extent, is subject to general economic, financial, competitive, legislative, regulatory, and other factors that are beyond the Company’s control. Based on current operations, the Company believes that its cash flow from operations and available cash of $60.3 million at June 24, 2020 will be adequate to meet the Company’s liquidity needs for the next twelve months from the date of filing of these condensed consolidated financial statements. However, depending on the severity and longevity of the COVID-19 pandemic, the Company’s financial performance and liquidity could be further impacted and could impact the Company’s ability to meet certain covenants required in its 2018 Credit Agreement (as defined below), specifically the lease-adjusted coverage ratio and fixed-charge coverage ratio.

Recovery of Securities Class Action Legal Expenses and Other Insurance Claims

During the thirteen and twenty-six weeks ended June 24, 2020, the Company received insurance proceeds of $0.1 million related to a property claim. During the thirteen and twenty-six weeks ended June 26, 2019, the Company received insurance proceeds of $10.0 million related to the settlement of a securities class action lawsuit. See Note 7, “Commitments and Contingencies, Legal Matters.’

Loss on Disposition of Restaurants

During the thirteen and twenty-six weeks ended June 26, 2019, the Company completed the sale of four company-operated restaurants within the San Francisco area to an existing franchisee and seven company-operated restaurants in the Phoenix area to another existing franchisee. The Company determined that these restaurant dispositions represent multiple element arrangements, and as a result, the cash consideration received was allocated to the separate elements based on their relative selling price. Cash proceeds included upfront consideration for the sale of the restaurants and franchise fees, as well as future cash consideration for royalties and lease payments. The Company considered the future lease payments in allocating the initial cash consideration received. The cash consideration per restaurant for franchise fees is consistent with the amounts stated in the related franchise agreements, which are charged for separate standalone arrangements. The Company initially defers and subsequently recognizes the franchise fees over the term of the franchise agreement. Future royalty income is also recognized in revenue as earned.

These sales resulted in cash proceeds of $4.8 million and a net loss on sale of restaurants of $0.9 million and $5.1 million for the thirteen and twenty-six weeks ended June 26, 2019, respectively. These restaurants are now included in the total number of franchised El Pollo Loco restaurants.

Recently Adopted Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2020-04, "Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting," which provides optional guidance, for a limited time, to ease the potential burden in accounting for or

recognizing the effects of reference rate reform on financial reporting. ASU 2020-04 is effective for a limited time, from March 12, 2020, through December 31, 2022. The Company adopted this ASU on March 12, 2020. The adoption of ASU 2020-04 did not have a significant impact on the Company’s consolidated financial position or results of operations.

In February 2018, the FASB issued ASU No. 2018-13, "Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement," which finalizes proposed ASU No. 2015-350, and of the same name as part of its disclosure framework project, which focuses on improving the effectiveness of disclosures in the notes to financial statements by facilitating clear communication of the information required by U.S. GAAP that is most important to users of each entity’s financial statements. The Company adopted ASU No. 2018-13 during the first quarter of 2020. The adoption of ASU 2018-13 did not have a significant impact on the Company’s consolidated financial position or results of operations.

In June 2016, the FASB issued ASU No. 2016-13, "Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments," which finalizes proposed ASU No. 2012-260 "Financial Instruments—Credit Losses (Subtopic 825-15)" and adds Topic 326 "Financial Instruments—Credit Losses", to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date by replacing the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The Company adopted ASU No. 2016-13 during the first quarter of 2020. The adoption of ASU 2016-03 did not have a significant impact on the Company’s consolidated financial position or results of operations.

Recent Accounting Pronouncements Not Yet Adopted

In December 2019, the FASB issued ASU No. 2019-12, "Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes", which modifies Topic 740 to simplify the accounting for income taxes. ASU 2019-12 is effective for financial statements issued for annual periods beginning after December 15, 2020, and for the interim periods therein. The adoption of ASU 2019-12 is not expected to have a significant impact on the Company’s consolidated financial position or results of operations.

Concentration of Risk

Cash and cash equivalents are maintained at financial institutions and, at times, these balances may exceed federally-insured limits. The Company has never experienced any losses related to these balances.

The Company had one supplier for which amounts due totaled 44.5% and 11.7% of the Company’s accounts payable at June 24, 2020 and December 25, 2019, respectively. Purchases from the Company’s largest supplier totaled 26.4% and 27.0% of total expenses for the thirteen and twenty-six weeks ended June 24, 2020, respectively, and 30.3% and 28.8% of total expenses for the thirteen and twenty-six weeks ended June 26, 2019.

Company-operated and franchised restaurants in the greater Los Angeles area generated, in the aggregate, approximately 71.1% and 71.7% of total revenue for the thirteen and twenty-six weeks ended June 24, 2020, respectively, and 69.3% for each of the thirteen and twenty-six weeks ended June 26, 2019.

Goodwill and Indefinite Lived Intangible Assets

The Company’s indefinite-lived intangible assets consist of trademarks. Goodwill represents the excess of cost over fair value of net identified assets acquired in business combinations accounted for under the purchase method. The Company does not amortize its goodwill and indefinite-lived intangible assets. Goodwill resulted from the acquisition of certain franchise locations.

Upon the sale or closure of a restaurant, the Company evaluates whether there is a decrement of goodwill. The amount of goodwill included in the cost basis of the asset sold is determined based on the relative fair value of the portion of the reporting unit disposed of compared to the fair value of the reporting unit retained. The Company determined there was no decrement of goodwill related to the disposition of restaurants during the thirteen and twenty-six weeks ended June 26, 2019.

The Company performs an annual impairment test for goodwill during the fourth fiscal quarter of each year, or more frequently if impairment indicators arise.

The Company reviews goodwill for impairment utilizing either a qualitative assessment or a fair value test by comparing the fair value of a reporting unit with its carrying amount. If the Company decides that it is appropriate to perform a qualitative assessment and concludes that the fair value of a reporting unit more likely than not exceeds its carrying value, no further evaluation is necessary. If the Company performs the fair value test, the Company will compare the fair value of a reporting unit with its carrying amount, including goodwill. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired. If the carrying amount of a reporting unit exceeds its fair value, the Company will recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized cannot exceed the total amount of goodwill allocated to that reporting unit.

The Company performs an annual impairment test for indefinite-lived intangible assets during the fourth fiscal quarter of each year, or more frequently if impairment indicators arise. An impairment test consists of either a qualitative assessment or a comparison of the fair value of an intangible asset with its carrying amount. The excess of the carrying amount of an intangible asset over its fair value is recognized as an impairment loss.

The assumptions used in the estimate of fair value are generally consistent with the past performance of the Company’s reporting segment and are also consistent with the projections and assumptions that are used in current operating plans. These assumptions are subject to change as a result of changing economic and competitive conditions.

Due to the recent impact of the COVID-19 pandemic to the global economy, including but not limited to, the volatility of the Company’s stock price as well as that of its competitors and the challenging environment for the restaurant industry generally, the Company determined that there were indicators of potential impairment of its goodwill and indefinite-lived intangible assets during the thirteen and twenty-six weeks ended June 24, 2020. As such, the Company performed an impairment assessment for both goodwill and indefinite-lived intangible assets and concluded that the fair value of these assets substantially exceeded their carrying values. Accordingly, the Company did not record any impairment to its goodwill or indefinite-lived intangible assets during the thirteen and twenty-six weeks ended June 24, 2020. The ultimate severity and longevity of the COVID-19 pandemic is unknown, and therefore, it is possible that impairments could be identified in future periods, and such amounts could be material.

Fair Value Measurements

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets and liabilities carried at fair value are classified and disclosed in one of the following three categories:

●

Level 1: Quoted prices for identical instruments in active markets.

●

Level 2: Observable prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs or significant value drivers are observable.

●

Level 3: Unobservable inputs used when little or no market data is available.

During fiscal 2019, the Company entered into an interest rate swap, which is required to be measured at fair value on a recurring basis. The fair value was determined based on Level 2 inputs, which include valuation models, as reported by the Company’s counterparty. These valuation models use a discounted cash flow analysis on the cash flows of the derivative based on the terms of the contract and the forward yield curves adjusted for the Company’s credit risk. The key inputs for the valuation models are observable market prices, discount rates, and forward yield curves. See "Note 4.

Long-Term Debt" for further discussion regarding our interest rate swaps. The following table presents fair value for the interest rate swap at June 24, 2020 (in thousands):


			Fair Value Measurements Using
	Fair Value		Level 1		Level 2		Level 3
Other non-current liabilities - Interest rate swap	$	1,408	$	—	$	1,408	$	—

The following table presents fair value for the interest rate swap at December 25, 2019 (in thousands):


			Fair Value Measurements Using
	Fair Value		Level 1		Level 2		Level 3
Other assets - Interest rate swap	$	360	$	—	$	360	$	—

Certain assets and liabilities are measured at fair value on a nonrecurring basis. In other words, the instruments are not measured at fair value on an ongoing basis, but are subject to fair value adjustments only in certain circumstances (e.g. when there is evidence of impairment).

The following non-financial instruments were measured at fair value, on a nonrecurring basis, as of and for the thirteen and twenty-six weeks ended June 24, 2020 (in thousands):


									Thirteen Weeks		Twenty-Six Weeks
			Fair Value Measurements at June 24, 2020 Using						Ended June 24, 2020		Ended June 24, 2020
	Total		Level 1		Level 2		Level 3		Impairment Losses		Impairment Losses
Certain property and equipment owned, net	$	—	$	—	$	—	$	—	$	52	$	1,429
Certain ROU assets, net	$	918	$	—	$	—	$	918	$	—	$	543

The following non-financial instruments were measured at fair value on a nonrecurring basis as of and for the thirteen and twenty-six weeks ended June 26, 2019 (in thousands):


									Thirteen Weeks		Twenty-Six Weeks
			Fair Value Measurements at June 26, 2019 Using						Ended June 26, 2019		Ended June 26, 2019
	Total		Level 1		Level 2		Level 3		Impairment Losses		Impairment Losses
Certain property and equipment owned, net	$	—	$	—	$	—	$	—	$	227	$	227

Impairment of Long-Lived Assets and ROU Assets

The Company reviews its long-lived and right-of-use assets ("ROU assets") for impairment on a restaurant-by-restaurant basis whenever events or changes in circumstances indicate that the carrying value of certain long-lived and ROU assets may not be recoverable. The Company considers a triggering event related to long-lived assets or ROU assets in a net asset position to have occurred related to a specific restaurant if the restaurant’s cash flows for the last twelve months are less than a minimum threshold or if consistent levels of undiscounted cash flows for the remaining lease period are less than the carrying value of the restaurant’s assets. Additionally, the Company considers a triggering event related to ROU assets to have occurred related to a specific lease if the location has been subleased and future estimated sublease income is less than current lease payments. If the Company concludes that the carrying value of certain long-lived and ROU assets will not be recovered based on expected undiscounted future cash flows, an impairment loss is recorded to reduce the long-lived or ROU assets to their estimated fair value. The fair value is measured on a nonrecurring basis using unobservable (Level 3) inputs. There is uncertainty in the projected undiscounted future cash flows used in the Company’s impairment review analysis, which requires the use of estimates and assumptions. If actual performance does not achieve the projections, or if the assumptions used change in the future, the Company may be required to recognize impairment charges in future periods, and such charges could be material. The Company determined that triggering events occurred during each of the thirteen and twenty-six weeks ended June 24, 2020 that required an impairment review of the Company’s long-lived and ROU assets. Based on the results of the analysis, the Company recorded non-cash impairment charges of $0.1 million and $2.0 million for the thirteen and twenty-six weeks ended June 24, 2020, respectively, primarily related to the carrying value of the ROU assets of one restaurant in Texas and the long-lived assets of three restaurants in California.

The Company recorded a non-cash impairment charge of $0.2 million for both the thirteen and twenty-six weeks ended June 26, 2019, primarily related to the carrying value of one restaurant in California. Given the inherent uncertainty in projecting results for newer restaurants in newer markets, as well as the impact of the COVID-19 pandemic, the Company is monitoring the recoverability of the carrying value of the assets of several restaurants on an ongoing basis. For these restaurants, if expected performance is not realized, an impairment charge may be recognized in future periods, and such charge could be material.

Closed-Store Reserves

When a restaurant is closed, the Company will evaluate the ROU asset for impairment, based on anticipated sublease recoveries. The remaining value of the ROU asset is amortized on a straight-line basis, with the expense recognized in closed-store reserve expense. Additionally, any property tax and common area maintenance ("CAM") payments relating to closed restaurants are included within closed-store expense. During the thirteen and twenty-six weeks ended June 24, 2020, the Company recognized $0.4 million and $0.9 million of closed-store reserve expense related to the amortization of ROU assets, property taxes and CAM payments for its closed locations. During the twenty-six weeks ended June 26, 2019, the Company closed one restaurant in California and one restaurant in Texas, and recognized $0.3 million and $0.6 million of closed-store reserve expense for the thirteen and twenty-six weeks ended June 26, 2019, respectively, primarily related to the amortization of ROU assets, property taxes and CAM payments for its closed locations.

Derivative Financial Instruments

The Company uses an interest rate swap, a derivative instrument, to hedge interest rate risk and not for trading purposes. The derivative contract is entered into with a financial institution.

The Company records the derivative instrument on its condensed consolidated balance sheet at fair value. The derivative instrument qualifies as a hedging instrument in a qualifying cash flow hedge relationship, and the gain or loss on the derivative instrument is reported as a component of accumulated other comprehensive (loss) income ("AOCI") and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. For any derivative instruments not designated as hedging instruments, the gain or loss will be recognized in earnings immediately. If a derivative previously designated as a hedge is terminated, or no longer meets the qualifications for hedge accounting, any balances in AOCI will be reclassified to earnings immediately.

As a result of the use of an interest rate swap, the Company is exposed to risk that the counterparty will fail to meet their contractual obligations. To mitigate the counterparty credit risk, the Company will only enter into contracts with major financial institutions, based upon their credit ratings and other factors, and will continue to assess the creditworthiness of the counterparty. As of June 24, 2020, the counterparty to the Company’s interest rate swap has performed in accordance with its contractual obligation.

Income Taxes

The provision for income taxes, income taxes payable and deferred income taxes is determined using the asset and liability method. Deferred tax assets and liabilities are determined based on temporary differences between the financial carrying amounts and the tax bases of assets and liabilities using enacted tax rates in effect in the years in which the temporary differences are expected to reverse. On a periodic basis, the Company assesses the probability that its net deferred tax assets, if any, will be recovered. If, after evaluating all of the positive and negative evidence, a conclusion is made that it is more likely than not that some portion or all of the net deferred tax assets will not be recovered, a valuation allowance is provided by charging to tax expense to reserve the portion of deferred tax assets which are not expected to be realized.

The Company reviews its filing positions for all open tax years in all U.S. federal and state jurisdictions where the Company is required to file.

When there are uncertainties related to potential income tax benefits, in order to qualify for recognition, the position the Company takes has to have at least a “more likely than not” chance of being sustained (based on the position’s technical merits) upon challenge by the respective authorities. The term “more likely than not” means a likelihood of more than 50 percent. Otherwise, the Company may not recognize any of the potential tax benefit associated with the position. The

Company recognizes a benefit for a tax position that meets the “more likely than not” criterion at the largest amount of tax benefit that is greater than 50 percent likely of being realized upon its effective resolution. Unrecognized tax benefits involve management’s judgment regarding the likelihood of the benefit being sustained. The final resolution of uncertain tax positions could result in adjustments to recorded amounts and may affect the Company’s consolidated financial position, results of operations, and cash flows.

The Company’s policy is to recognize interest and penalties related to income tax matters in income tax expense. The Company had no accrual for interest or penalties at June 24, 2020 or at December 25, 2019, and did not recognize interest or penalties during the thirteen and twenty-six weeks ended June 24, 2020 or June 26, 2019, since there were no material unrecognized tax benefits. Management believes no material changes to the amount of unrecognized tax benefits will occur within the next twelve months.

On July 30, 2014, the Company entered into the income tax receivable agreement (the "TRA"), which calls for the Company to pay to its pre-IPO stockholders 85% of the savings in cash that the Company realizes in its income taxes as a result of utilizing its net operating losses and other tax attributes attributable to preceding periods. For the thirteen and twenty-six weeks ended June 24, 2020, the Company recorded income tax receivable agreement expense of $0.3 million and $0.2 million, respectively, and for the thirteen and twenty-six weeks ended June 26, 2019, the Company recorded income tax receivable agreement income of $0.1 million and income tax receivable expense of $0.1 million, respectively, related to the amortization of interest expense related to our total expected TRA payments and changes in estimates for actual tax returns filed and future forecasted taxable income.

On March 27, 2020, President Trump signed into a law a stimulus package, the Coronavirus Aid, Relief and Economic Security ("CARES") Act, which contains several tax provisions and deferral of employer Social Security taxes that are otherwise owed for wage payments. The tax provisions include a correction of a previous drafting error related to quality improvement property ("QIP") and immediate refundability of all remaining alternative minimum tax ("AMT") credits. The new provisions did not have a material impact on the Company’s condensed consolidated financial statements.

During the twenty-six weeks ended June 24, 2020 the Company received a Notice of Proposed Adjustment ("NOPA"), for the years ended December 27, 2017 and December 28, 2016, related to the Company’s methodology regarding its ordering of utilization of AMT net operating losses ("NOL”). This resulted in payment of $0.4 million, and the audit is closed. As a result of the CARES Act, discussed above, this amount is immediately refundable upon filing of a Form 1139, which the Company filed during the thirteen and twenty-six weeks ended June 24, 2020 and recognized a receivable, included in Accounts and other receivables within the condensed consolidated balance sheet as of June 24, 2020.

Long-Term Debt

6 Months Ended

Jun. 24, 2020

Debt Disclosure [Abstract]

Long-Term Debt

4. LONG-TERM DEBT

On July 13, 2018, the Company refinanced a credit agreement with Bank of America, N.A., initially entered into on December 11, 2014 (the “2014 Revolver”), pursuant to a credit agreement (the “2018 Credit Agreement”) among EPL, as borrower, and the Company and Intermediate, as guarantors, Bank of America, N.A., as administrative agent, swingline lender, and letter of credit issuer, the lenders party thereto, and the other parties thereto, which provides for a $150.0 million five-year senior secured revolving credit facility (the “2018 Revolver”). The 2018 Revolver includes a sub limit of $15.0 million for letters of credit and a sub limit of $15.0 million for swingline loans. The 2018 Revolver and 2018 Credit Agreement will mature on July 13, 2023. The obligations under the 2018 Credit Agreement and related

loan documents are guaranteed by the Company and Intermediate. The obligations of the Company, EPL and Intermediate under the 2018 Credit Agreement and related loan documents are secured by a first priority lien on substantially all of their respective assets.

Under the 2018 Revolver, Holdings may not make certain payments such as cash dividends, except that it may, inter alia, (i) pay up to $1.0 million per year to repurchase or redeem qualified equity interests of Holdings held by past or present officers, directors, or employees (or their estates) of the Company upon death, disability, or termination of employment, (ii) pay under its TRA, and, (iii) so long as no default or event of default has occurred and is continuing, (a) make non-cash repurchases of equity interests in connection with the exercise of stock options by directors, officers and management, provided that those equity interests represent a portion of the consideration of the exercise price of those stock options, (b) pay up to $0.5 million in any 12 month consecutive period to redeem, repurchase or otherwise acquire equity interests of any subsidiary that is not a wholly-owned subsidiary from any holder of equity interest in such subsidiary, (c) pay up to $2.5 million per year pursuant to stock option plans, employment agreements, or incentive plans, (d) make up to $5.0 million in other restricted payments per year, and (e) make other restricted payments, subject to its compliance, on a pro forma basis, with (x) a lease-adjusted consolidated leverage ratio not to exceed 4.25 times and (y) the financial covenants applicable to the 2018 Revolver.

Borrowings under the 2018 Credit Agreement (other than any swingline loans) bear interest, at the borrower’s option, at rates based upon either LIBOR or a base rate, plus, for each rate, a margin determined in accordance with a lease-adjusted consolidated leverage ratio-based pricing grid. The base rate is calculated as the highest of (a) the federal funds rate plus 0.50%, (b) the published Bank of America prime rate, or (c) LIBOR plus 1.00%. For LIBOR loans, the margin is in the range of 1.25% to 2.25%, and for base rate loans the margin is in a range of 0.25% to 1.25%. Borrowings under the 2018 Revolver may be repaid and reborrowed. The interest rate range was 1.67% to 3.11% and 1.67% to 3.29% for the thirteen and twenty-six weeks ended June 24, 2020, respectively, and 3.90% to 6.00% for both the thirteen and twenty-six weeks ended June 26, 2019.

The 2018 Credit Agreement contains certain financial covenants. The Company was in compliance with the financial covenants as of June 24, 2020. However, depending on the severity and longevity of the COVID-19 pandemic, the Company’s financial performance and liquidity could be further impacted and could impact the Company’s ability to comply with certain financial covenants required in the 2018 Credit Agreement, specifically the lease-adjusted coverage ratio and fixed-charge coverage ratio.

At June 24, 2020, $11.1 million of letters of credit and $138.8 million in borrowings under the 2018 Revolver were outstanding. The Company had $0.1 million in borrowing availability under the 2018 Revolver at June 24, 2020.

Maturities

During the thirteen weeks ended June 24, 2020, the Company elected to pay down $2.7 million on its 2018 Revolver. During the twenty-six weeks ended June 24, 2020, the Company borrowed $41.8 million, net of pay downs of $10.7 million on its 2018 Revolver, primarily as a precautionary measure to bolster its existing cash position, related to the uncertainty regarding the current COVID-19 pandemic, as well as to fund litigation settlement payments. See Note 1 under "COVID-19" for further details regarding the Company’s actions related to the COVID-19 pandemic and Note 7 for further details regarding the litigation settlement payments. During the thirteen and twenty-six weeks ended June 26, 2019, the Company borrowed $14.0 million and $11.0 million, respectively, net of pay downs of $12.0 and $15.0 million of outstanding borrowings on the Company’s 2018 Revolver, primarily to fund settlement payments. There are no required principal payments prior to maturity for the 2018 Revolver.

Interest Rate Swap

During the year ended December 25, 2019, the Company entered into a variable-to-fixed interest rate swap agreement with a notional amount of $40.0 million that matures in June 2023. The objective of the interest rate swap was to reduce the Company’s exposure to interest rate risk for a portion of its variable-rate interest payments on its borrowings under the 2018 Revolver. Under the terms of the swap agreement, the variable LIBOR-based component of interest payments was converted to a fixed rate of 1.31%, plus applicable margin, which is currently 1.5%. The interest rate swap was designated as a cash flow hedge, as the changes in the future cash flows of the swap were expected to offset changes in expected future interest payments on the related variable-rate debt, in accordance with Accounting Standards Codification (“ASC”) 815 “Derivatives and Hedging.”

The changes in the fair value of the interest rate swap are not included in earnings, but are included in other comprehensive (loss) income (“OCI”). These changes in fair value are subsequently reclassified into net earnings as a component of interest expense as the hedged interest payments are made on the variable rate borrowings.

For the thirteen and twenty-six weeks ended June 24, 2020, the swap was a highly effective cash flow hedge.

As of June 24, 2020, the estimated net loss included in AOCI related to the Company’s cash flow hedge that will be reclassified into earnings in the next 12 months is $0.5 million, based on current LIBOR interest rates.

The following table shows the financial statement line item and amount of the Company’s cash flow hedge accounting on the condensed consolidated balance sheet (in thousands):


	June 24, 2020				December 25, 2019
	Notional		Fair value		Notional		Fair value
Other assets - Interest rate swap		—		—	$	40,000	$	360
Other liabilities - Interest rate swap	$	40,000	$	1,408		—		—

The following table summarizes the effect of the Company’s cash flow hedge accounting on the condensed consolidated statements of income (in thousands):


	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 24, 2020		June 26, 2019		June 24, 2020		June 26, 2019
Interest expense on hedged portion of debt	$	212		—	$	641		—
Interest expense on interest rate swap		81		—		42		—
Interest expense on debt and derivatives, net	$	293	$	—	$	683	$	—

The following table summarizes the effect of the Company’s cash flow hedge accounting on AOCI for the thirteen and twenty-six weeks ended June 24, 2020 and June 26, 2019 (in thousands):


	Thirteen Weeks Ended						Twenty-Six Weeks Ended
				Loss Reclassified from						Loss Reclassified from
	Net Loss Recognized in OCI			AOCI into Interest expense			Net Loss Recognized in OCI			AOCI into Interest expense
	June 24, 2020		June 26, 2019	June 24, 2020		June 26, 2019	June 24, 2020		June 26, 2019	June 24, 2020		June 26, 2019
Interest rate swap	$	296	—	$	81	—	$	1,755	—	$	42	—

See Note 1 for the fair value of our derivative asset.

Commitments and Contingencies

6 Months Ended

Jun. 24, 2020

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

7. COMMITMENTS AND CONTINGENCIES

Legal Matters

On or about February 24, 2014, a former employee filed a class action in the Superior Court of the State of California, County of Orange, under the caption Elliott Olvera, et al v. El Pollo Loco, Inc., et al (Case No. 30-2014-00707367-CU-OE-CXC) on behalf of all putative class members (all hourly employees from 2010 to the present) alleging certain violations of California labor laws, including failure to pay overtime compensation, failure to provide meal periods and rest breaks, and failure to provide itemized wage statements. The putative lead plaintiff’s requested remedies include compensatory and punitive damages, injunctive relief, disgorgement of profits, and reasonable attorneys’ fees and costs. No specific amount of damages sought was specified in the complaint. The court recently certified two classes of plaintiffs - one class encompasses restaurant employees who were not provided proper rest breaks because they were not allowed to leave the premises during their breaks and the other class encompasses restaurant employees who were required to wait at the restaurant after they finished working for the night until the manager set the alarm for safety purposes. The parties reached a settlement in principle on January 24, 2019 of all claims brought on behalf of the 32,000+ putative class members in the Olvera, as well as all claims for failure to pay overtime compensation, failure to provide meal periods and rest breaks, and failure to provide itemized wage statements brought in the class actions captioned Martha Perez v. El Pollo Loco, Inc. (Los Angeles Superior Court Case No. BC624001), Maria Vega, et al. v. El Pollo Loco, Inc. (Los Angeles Superior Court Case No. BC649719), and Gonzalez v. El Pollo Loco, Inc. (Los Angeles Superior Court Case No. BC712867). The settlement reached in principle in the Olvera, Perez, Vega, and Gonzalez actions resolves all potential claims from April 12, 2010 through April 1, 2019 that El Pollo Loco restaurant employees may have against El Pollo Loco for failure to pay for all compensation owed, failure to pay overtime compensation, failure to provide meal periods and rest breaks and failure to provide itemized wage statements, among other wage and hour related claims. A $16.3 million accrual of an expected settlement amount related to this matter was recorded as of December 26, 2018, and the court formally approved the settlement on January 31, 2020. The settlement payment was made on February 28, 2020. Purported class actions alleging wage and hour violations are commonly filed against California employers. The Company fully expects to have to defend against similar lawsuits in the future.

Daniel Turocy, et al. v. El Pollo Loco Holdings, Inc., et al. (Case No. 8:15-cv-01343) was filed in the United States District Court for the Central District of California on August 24, 2015, and Ron Huston, et al. v. El Pollo Loco Holdings, Inc., et al. (Case No. 8:15-cv-01710) was filed in the United States District Court for the Central District of California on October 22, 2015. The two lawsuits have been consolidated, with co-lead plaintiffs and class counsel. A consolidated complaint was filed on January 29, 2016, on behalf of co-lead plaintiffs and others similarly situated, alleging violations of federal securities laws in connection with Holdings common stock purchased or otherwise acquired and the purchase of call options or the sale of put options, between May 1, 2015 and August 13, 2015 (the “Class Period”). The named defendants are Holdings; Stephen J. Sather, Laurance Roberts, and Edward J. Valle (collectively, the “Individual Defendants”); and Trimaran Pollo Partners, LLC, Trimaran Capital Partners, and Freeman Spogli & Co. (collectively, the “Controlling Shareholder Defendants”). Among other things, Plaintiffs allege that, in 2014 and early 2015, Holdings suffered losses due to rising labor costs in California and, in an attempt to mitigate the effects of such rising costs, removed a $5 value option from the Company’s menu, which resulted in a decrease in traffic from value-conscious consumers. Plaintiffs further allege that during the Class Period, Holdings and the Individual Defendants made a series of materially false and misleading statements that concealed the effect that these factors were having on store sales growth, resulting in Holdings stock continuing to be traded at artificially inflated prices. As a result, Plaintiffs and other members of the putative class allegedly suffered damages in connection with their purchase of Holdings’ stock during the Class Period. In addition, Plaintiffs allege that the Individual Defendants and Controlling Shareholder Defendants had direct involvement in, and responsibility over, the operations of Holdings, and are presumed

to have had, among other things, the power to control or influence the transactions giving rise to the alleged securities law violations. In both cases, Plaintiffs seek an unspecified amount of damages, as well as costs and expenses (including attorneys’ fees).

On July 25, 2016, the Court issued an order granting, without prejudice, Defendants’ Motion to Dismiss plaintiff’s complaint for failure to state a claim. Plaintiffs were granted leave to amend their complaint, and filed an amended complaint on August 22, 2016. Defendants moved to dismiss the amended complaint, and on March 20, 2017, the Court dismissed the amended complaint and granted Plaintiffs leave to file another amended complaint. Plaintiffs filed another amended complaint on April 17, 2017. Defendants filed a motion to dismiss the amended complaint on or about May 17, 2017. The Court denied Defendants’ motion to dismiss the third amended complaint on August 4, 2017. On December 8, 2017, Plaintiffs filed a motion for class certification, and on July 3, 2018, the Court granted Plaintiffs’ motion and certified a class as to all of Plaintiffs’ claims. Defendants filed a petition for appellate review of a portion of the Court’s July 3, 2018 class certification order. On October 19, 2018 the Ninth Circuit Court of Appeals denied the petition.

On January 23, 2019, the parties filed a Notice of Settlement and Joint Request for Order to Stay Proceedings, stating the parties have reached an agreement in principle to settle the claims and allegations in the action and are negotiating the terms of a Stipulation of Settlement. On January 24, 2019, the Court ordered that all proceedings in the action be stayed until April 3, 2019, on or before which the parties were to file and did so file a Stipulation of Settlement and a motion for preliminary approval of the settlement. The court granted preliminary approval of the settlement on May 13, 2019. Defendants maintain that the Plaintiffs’ claims are without merit, and entered into the settlement with Plaintiffs to eliminate the uncertainties, burden and expense of further protracted litigation. A $20.0 million accrual of an expected settlement amount related to this matter was recorded as of December 26, 2018 and all settlement payments were made during the year ended December 25, 2019.

On or about November 5, 2015, a purported Holdings shareholder filed a derivative complaint on behalf of Holdings in the Court of Chancery of the State of Delaware against certain Holdings officers, directors and Trimaran Pollo Partners, L.L.C., under the caption Armen Galustyan v. Sather, et al. (Case No. 11676-VCL). The derivative complaint alleges that these defendants breached their fiduciary duties to Holdings and were unjustly enriched when they sold shares of Holdings at artificially inflated prices due to alleged misrepresentations and omissions regarding EPL’s comparable store sales in the second quarter of 2015. The Holdings shareholder’s requested remedies include an award of compensatory damages to Holdings, as well as a court order to improve corporate governance by putting forward for stockholder vote certain resolutions for amendments to Holdings’ Bylaws or Certificate of Incorporation. The parties have stipulated to, which the court has ordered, a stay of these proceedings pending the outcome of Turocy v. El Pollo Loco Holdings, Inc., discussed above. A second purported Holdings shareholder filed a derivative complaint on or about September 23, 2016, under the caption Diep v. Sather, CA 12760-VCL in the Delaware Court of Chancery. The Diep action is also purportedly brought on behalf of Holdings, names the same defendants and asserts substantially the same claims on substantially the same alleged facts as does Galustyan. Defendants moved to stay or dismiss the Diep action.

On March 17, 2017, the Delaware court granted in part, and denied in part, the motion to stay the Diep action. The court denied defendants’ motion to dismiss the complaint for failure to state a claim. On January 17, 2018, the court entered an order granting the parties’ stipulation staying all proceedings in the Diep action for five months or until the completion of an investigation of the allegations in the action by a special litigation committee of the Holdings board of directors (the "SLC"). On February 13, 2019, after concluding its investigation, the SLC filed a motion to dismiss the Diep action. The SLC filed its investigative report under seal as an exhibit to the motion to dismiss. Discovery related to the SLC’s motion is ongoing.

Janice P. Handlers-Bryman and Michael D. Bryman v. El Pollo Loco, Inc., Los Angeles Superior Court (Case No. MC026045) (the “Lancaster Lawsuit”) was filed on February 9, 2016. Existing El Pollo Loco franchisees, Janice P. Handlers-Bryman and Michael D. Bryman, as individuals and in their capacities as trustees of the Handlers Bryman Trust (collectively, “Plaintiffs”), filed suit against us alleging, among other things, that we “imposed unreasonable time limitations” on their development of additional restaurant locations in Lancaster, California, and that we thereafter developed company-operated El Pollo Loco restaurants in the “market area” of Plaintiffs’ existing El Pollo Loco restaurant in Lancaster. Plaintiffs asserted claims against us for, among other things, (i) breach of the implied covenant of good faith and fair dealing, (ii) intentional interference with prospective business, and (iii) unfair business practices. In addition to an unspecified amount of damages and costs of the lawsuit, Plaintiffs sought reformation of the contract, declaratory relief, disgorgement of alleged revenues and profits, injunctive relief, and a judicial mandate requiring us to either transfer the company-operated locations to Plaintiffs or to continuously disgorge to Plaintiffs the unjust

enrichment allegedly obtained by us through the operation of the company-operated restaurants in Lancaster. We denied Plaintiffs’ allegations as the franchise agreement did not grant Plaintiffs any exclusive territorial rights and, instead, expressly reserved for us the right to open and operate - and the right to grant others the right to open and operate - El Pollo Loco restaurants “in the immediate vicinity of or adjacent to” Plaintiffs’ restaurant in Lancaster. On April 24, 2017, four days before the commencement of trial, Plaintiffs filed a voluntary dismissal, without prejudice, of the Lancaster Lawsuit without any payment or other concession by us. The corresponding dismissal was entered by the court on April 25, 2017. On May 22, 2017, Plaintiffs filed a motion for relief from the dismissal which was granted by the court on June 29, 2017. The trial in the case was bifurcated between the liability and damages phases. The liability phase commenced on November 16, 2017. The only cause of action that the court allowed to go to the jury was the cause of action for breach of the covenant of good faith and fair dealing. The court elected not to present the cause of action for intentional interference with prospective business to the jury. (The causes of action for reformation due to mistake and unconscionability, unfair business practices under California Business & Professions Code §17200 et seq., and declaratory relief were not presented to the jury as these types of equitable claims are to be decided by the court as a matter of law.) On December 11, 2017, the jury returned a verdict in favor of Plaintiffs finding that the Company breached the implied covenant of good faith and fair dealing by (1) constructing the two new company-operated El Pollo Loco restaurants in Lancaster, and (2) not offering the two new company-operated El Pollo Loco restaurants in Lancaster to Plaintiffs. Because the trial was bifurcated, the December 11, 2017 verdict did not include a determination of damages.

The damages phase of the trial commenced on April 20, 2018. On May 1, 2018, the jury returned a verdict on damages in favor of Plaintiffs in the following amounts: (1) $4,356,600 in “impact damages” arising out of our construction of the two new company-owned El Pollo Loco restaurants in Lancaster, and (2) $4,481,206 in “lost opportunity damages” arising out of our failure to offer the two new company-operated El Pollo Loco restaurants in Lancaster to Plaintiffs. On August 1, 2018, the court issued a final judgment and decision on the unfair business practices claim under California Business & Professions Code § 17200 et seq. As part of the final judgment, the court found El Pollo Loco liable and issued injunctive relief requiring El Pollo Loco to revise its franchise disclosure document and franchise agreement. The court also awarded Plaintiffs restitution of $4,356,600 for “impact damages” arising out of our construction of the two new company-operated El Pollo Loco restaurants in Lancaster. The court, reversing its previous position, held that these damages could be awarded in addition to the "lost opportunity damages" awarded by the jury. Thus, the court entered a total monetary judgment of $8,837,806. There was no ruling on the causes of action for reformation due to mistake and declaratory relief, and on January 27, 2020, the court entered an amended judgment dismissing these claims. The trial court subsequently awarded the Plaintiffs $249,728 in costs and $1,391,703 in attorney fees. Post judgment interest is running at 10% simple interest per year on the total amount of the monetary judgment, costs, and attorney fees.

On August 27, 2018, the Company filed a notice of appeal as to the entire judgment. As required by California law, on or about August 16, 2018, the Company obtained an appeal bond through a Surety company to secure the trial court’s judgment during the pendency of the appeal. The appeal on the merits is currently pending, but has been stayed pending the Parties’ agreement in principle to settle the matter, discussed immediately below.

On March 19, 2020, the Surety, One Beacon, from whom the Company procured the appeal bond to secure the judgment against the Company in the matter of Janice P. Handlers-Bryman and Michael D. Bryman v. El Pollo Loco, Inc., issued a collateral demand to the Company. On April 17, 2020, the Company provided to One Beacon a Letter of Credit in the amount of $2,651,342 to satisfy the Surety’s collateral demand. On July 13, 2020, One Beacon agreed to release its collateral demand and returned the Letter of Credit to the Company. Subsequent to June 24, 2020, the Company reached an agreement in principle with the Plaintiffs to resolve the lawsuit for a payment by the Company of $2.5 million, which was recorded within operating expenses in the Company’s condensed consolidated statement of income for the thirteen and twenty-six weeks ended June 24, 2020, contingent upon approval by the court of appeal of the terms of the parties’ proposed settlement.

The Company is also involved in various other claims and legal actions that arise in the ordinary course of business. The Company does not believe that the ultimate resolution of these other actions will have a material adverse effect on its financial position, results of operations, liquidity, or capital resources. A significant increase in the number of claims, or an increase in amounts owing under successful claims, could materially and adversely affect its business, consolidated financial condition, results of operations, and cash flows.

Purchasing Commitments

The Company has long-term beverage supply agreements with certain major beverage vendors. Pursuant to the terms of these arrangements, marketing rebates are provided to the Company and its franchisees from the beverage vendors based upon the dollar volume of purchases for system-wide restaurants which will vary according to their demand for beverage syrup and fluctuations in the market rates for beverage syrup. These contracts have terms extending through the end of 2024.

At June 24, 2020, the Company’s total estimated commitment to purchase chicken was $11.1 million.

Contingent Lease Obligations

As a result of assigning the Company’s interest in obligations under real estate leases in connection with the sale of company-operated restaurants to some of the Company’s franchisees, the Company is contingently liable on four lease agreements. These leases have various terms, the latest of which expires in 2036. As of June 24, 2020, the potential amount of undiscounted payments the Company could be required to make in the event of non-payment by the primary lessee was $2.8 million. The present value of these potential payments discounted at the Company’s estimated pre-tax cost of debt at June 24, 2020 was $2.6 million. The Company’s franchisees are primarily liable on the leases. The Company has cross-default provisions with these franchisees that would put them in default of their franchise agreements in the event of non-payment under the leases. The Company believes that these cross-default provisions reduce the risk that payments will be required to be made under these leases. Due to the current uncertainty related to the COVID-19 pandemic and impact it has had on the ability of the Company’s franchisees to make their lease payments, the Company has recorded a $0.1 million liability in the Company’s condensed consolidated financial statements related to these contingent liabilities.

Employment Agreements

The Company has employment agreements with three of the officers of the Company. These agreements provide for minimum salary levels, possible annual adjustments for cost-of-living changes, and incentive bonuses that are payable under certain business conditions.

Indemnification Agreements

The Company has entered into indemnification agreements with each of its current directors and officers. These agreements require the Company to indemnify these individuals to the fullest extent permitted under Delaware law against liabilities that may arise by reason of their service to the Company and to advance expenses incurred as a result of any proceeding against them as to which they could be indemnified. The Company also intends to enter into indemnification agreements with future directors and officers.

Revenue from Contracts with Customers

6 Months Ended

Jun. 24, 2020

Revenue from Contract with Customer [Abstract]

Revenue from Contracts with Customers

10. REVENUE FROM CONTRACTS WITH CUSTOMERS

Revenue Recognition

Nature of products and services

The Company has two revenue streams, company-operated restaurant revenue and franchise related revenue.

Company-operated restaurant revenue

Revenues from the operation of company-operated restaurants are recognized as food and beverage products are delivered to customers and payment is tendered at the time of sale. The Company presents sales, net of sales-related taxes and promotional allowances.

The Company offers a loyalty rewards program, which awards a customer points for dollars spent. When 100 points are accumulated a $10 reward to be used on future purchases is earned. If a customer does not earn or use points within a one-year period, their account is deactivated and all points expire. Additionally, if a $10 reward is not used within six months it expires. When a customer is part of the rewards program, the obligation to provide future discounts related to points earned is considered a separate performance obligation, to which a portion of the transaction price is allocated. The performance obligation related to loyalty points is deemed to have been satisfied, and the amount deferred in the balance sheet is recognized as revenue, when the points are transferred to a $10 reward and redeemed, the reward or points have expired, or the likelihood of redemption is remote. A portion of the transaction price is allocated to loyalty points, if necessary, on a pro-rata basis, based on stand-alone selling price, as determined by menu pricing and loyalty point’s terms. As of both June 24, 2020 and December 25, 2019, the revenue allocated to loyalty points that have not been redeemed was $1.1 million, which is reflected in the Company’s accompanying condensed consolidated balance sheets within other accrued expenses and current liabilities. The Company expects the loyalty points to be redeemed and recognized over a one-year period.

The Company sells gift cards to its customers in the restaurants and through selected third parties. The gift cards sold to customers have no stated expiration dates and are subject to actual and/or potential escheatment rights in several of the jurisdictions in which the Company operates. Furthermore, due to these escheatment rights, the Company does not recognize breakage related to the sale of gift cards due to the immateriality of the amount remaining after escheatment. The Company recognizes income from gift cards when redeemed by the customer. Unredeemed gift card balances are deferred and recorded as other accrued expenses on the accompanying condensed consolidated balance sheets.

Franchise and franchise advertising revenue

Franchise revenue consists of franchise royalties, initial franchise fees, license fees due from franchisees, IT support services, and rental income for subleases to franchisees. Franchise advertising revenue consists of advertising contributions received from franchisees. These revenue streams are made up of the following performance obligations:

●

Franchise license - inclusive of advertising services, development agreements, training, access to plans and help desk services.

●

Discounted renewal option.

●

Hardware services.

The Company satisfies the performance obligation related to the franchise license over the term of the franchise agreement, which is typically 20 years. Payment for the franchise license consists of three components, a fixed-fee related to the franchise/development agreement, a sales-based royalty fee and a sales-based advertising fee. The fixed fee, as determined by the signed development and/or franchise agreement, is due at the time the development agreement is entered into, and/or when the franchise agreement is signed, and does not include a finance component.

The sales-based royalty fee and sales-based advertising fee are considered variable consideration and will continue to be recognized as revenue as such sales are earned by the franchisees. Both sales-based fees qualify under the royalty constraint exception, and do not require an estimate of future transaction price. Additionally, the Company is utilizing the practical expedient available under ASC Topic 606, “Revenue from Contracts with Customers” (“Topic 606”) regarding disclosure of the aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied for sales-based royalties.

In certain franchise agreements, the Company offers a discounted renewal to incentivize future renewals after the end of the initial franchise term. As this is considered a separate performance obligation, the Company allocates a portion of the initial franchise fee to this discounted renewal, on a pro-rata basis, assuming a 20-year renewal. This performance obligation is satisfied over the renewal term, typically 10 or 20 years, while payment is fixed and due at the time the renewal is signed.

The Company purchases hardware, such as scanners, printers, cash registers and tablets, from third party vendors, which it then sells to franchisees. As the Company is considered the principal in this relationship, payment for the hardware is considered revenue, and is received upon transfer of the goods from the Company to the franchisee. As of June 24, 2020, there were no performance obligations related to hardware services that were unsatisfied or partially satisfied.

Disaggregated revenue

The following table presents our revenues disaggregated by revenue source and market (in thousands):


	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 24,		June 26,		June 24,		June 26,
	2020		2019		2020		2019
Core Market⁽¹⁾:
Company-operated restaurant revenue	$	81,370	$	88,808	$	167,285	$	174,114
Franchise revenue		3,208		4,174		6,716		7,673
Franchise advertising fee revenue		2,384		2,806		5,025		5,523
Total core market	$	86,962	$	95,788	$	179,026	$	187,310
Non-Core Market⁽²⁾:
Company-operated restaurant revenue	$	6,337	$	11,331	$	13,056	$	23,175
Franchise revenue		3,511		3,744		7,065		6,689
Franchise advertising fee revenue		2,794		2,877		5,620		5,543
Total non-core market	$	12,642	$	17,952	$	25,741	$	35,407
Total revenue	$	99,604	$	113,740	$	204,767	$	222,717

(1)	Core Market includes markets with existing company-operated restaurants at the time of the Company’s Initial Public Offering ("IPO") on July 28, 2014.

(2)	Non-Core Market includes markets entered into by the Company subsequent to the IPO date.

The following table presents our revenues disaggregated by geographic market:


	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 24, 2020		June 26, 2019		June 24, 2020		June 26, 2019
Greater Los Angeles area market	71.1	%	69.3	%	71.7	%	69.3	%
Other markets	28.9	%	30.7	%	28.3	%	30.7	%
Total	100	%	100	%	100	%	100	%

Contract balances

The following table provides information about the change in the franchise contract liability balances during the twenty-six weeks ended June 24, 2020 and June 26, 2019 (in thousands):


December 25, 2019	$	6,317
Revenue recognized - beginning balance		(544)
June 24, 2020	$	5,773

December 26, 2018	$	5,593
Revenue recognized - beginning balance		(203)
Additional contract liability		1,257
Revenue recognized - additional contract liability		(88)
June 26, 2019	$	6,559

The Company’s franchise contract liability includes development fees, initial franchise and license fees, franchise renewal fees, lease subsidies and royalty discounts and is included within other accrued expenses and current liabilities and other noncurrent liabilities within the accompanying condensed consolidated balance sheets. The Company receives area development fees from franchisees when they execute multi-unit area development agreements. Initial franchise and license fees, or franchise renewal fees, are received from franchisees upon the execution of, or renewal of, a franchise

agreement. Revenue is recognized from these agreements as the underlying performance obligation is satisfied, which is over the term of the agreement.

The following table illustrates the estimated revenue to be recognized in future periods related to performance obligations under the applicable contracts that are unsatisfied as of June 24, 2020 (in thousands):


Franchise revenues:
2020	$	323
2021		491
2022		410
2023		395
2024		381
Thereafter		3,773
Total	$	5,773

Contract Costs

The Company does not currently incur costs to obtain or fulfill a contract that would be considered contract assets under Topic 606.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-URI http://asc.fasb.org/topic&trid=49130388

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130551-203045

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130556-203045

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 9
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130550-203045

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (e)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 15
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130558-203045

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

+ Details

Leases

6 Months Ended

Jun. 24, 2020

Leases [Abstract]

Leases

11. LEASES

Adoption of Topic 842 "Leases"

On December 27, 2018, the Company adopted Topic 842, using the effective date method, recognizing and measuring all leases that existed as of December 27, 2018. The Company recorded a cumulative-effect adjustment as of December 27, 2018. All leases that either (1) commenced, or (2) were modified or re-measured after December 27, 2018 are accounted for under Topic 842.

As a result of Topic 842, the Company recognized a ROU asset of $205.2 million and a lease liability of $222.3 million on its consolidated balance sheet as of December 27, 2018. However, the adoption of Topic 842 did not result in a material impact on the Company’s consolidated statement of operations or consolidated statement of cash flows.

Nature of leases

The Company’s operations utilize property, facilities, equipment and vehicles leased from others. Additionally, the Company has various contracts with vendors that have been determined to contain an embedded lease in accordance with Topic 842.

As of June 24, 2020, the Company had no leases that it had entered into, but had not yet commenced. The Company does not have control of the property until lease commencement.

Building and facility leases

The majority of the Company’s building and facilities leases are classified as operating leases; however, the Company currently has one facility lease that is classified as a finance lease.

Restaurants are operated under lease arrangements that generally provide for a fixed base rent and, in some instances, contingent rent based on a percentage of gross operating profit or net revenues in excess of a defined amount. Additionally, a number of the Company’s leases have payments, which increase at pre-determined dates based on the change in the consumer price index. For all leases, the Company also reimburses the landlord for non-lease components, or items that are not considered components of a contract, such as common area maintenance, property tax and insurance costs. While the Company determined not to separate lease and non-lease components, these payments are based on actual costs, making them variable consideration and excluding them from the calculations of the ROU asset and lease liability.

The initial terms of land and restaurant building leases are generally 20 years, exclusive of options to renew. These leases typically have four 5-year renewal options, which have generally been excluded in the calculation of the ROU asset and lease liability, as they are not considered reasonably certain to be exercised, unless (1) the renewal had already occurred as of the time of adoption of Topic 842, or (2) there have been significant leasehold improvements that have a useful life that extend past the original lease term. Furthermore, there are no residual value guarantees and no restrictions imposed by the lease.

During the thirteen and twenty-six weeks ended June 24, 2020, the Company reassessed the lease terms on four and seven restaurants, respectively, due to certain triggering events, such as the addition of significant leasehold improvements, the decision to terminate a lease, or the decision to renew. As a result of the reassessment, an additional $1.4 million and $1.7 million of ROU asset and lease liabilities for the thirteen and twenty-six weeks ended June 24, 2020, respectively, were recognized and will be amortized over the new lease term. During the thirteen and twenty-six weeks ended June 26, 2019, the Company reassessed the lease terms on three restaurants due to the addition of significant leasehold improvements with useful lives that extend past the current lease expiration. This resulted in an additional $1.2 million of ROU asset and lease liability, which will be recognized over the new lease term. The reassessments did not have any impact on the original lease classification. Additionally, as the Company adopted all practical expedients available under Topic 842, no reallocation between lease and non-lease components was necessary.

The Company also subleases facilities to certain franchisees and other non-related parties which are also considered operating leases. Sublease income also includes contingent rental income based on net revenues. The vast majority of these leases have rights to extend terms via fixed rental increases. However, none of these leases have early termination rights, the right to purchase the premises or any residual value guarantees. The Company does not have any related party leases.

During the twenty-six weeks ended June 24, 2020, the Company determined that the carrying value of ROU assets at one restaurant was not recoverable. As a result, the Company recorded a $0.5 million impairment expense for the twenty-six weeks ended June 24, 2020, related to one restaurant in Texas, sold to franchisees in the prior year. The Company did not recognize any impairment related to ROU assets during the thirteen and twenty-six ended June 26, 2019.

Equipment

Leases of equipment primarily consist of restaurant equipment, copiers and vehicles. These leases are fixed payments with no variable component. Additionally, no optional renewal periods have been included in the calculation of the ROU asset, there are no residual value guarantees and no restrictions imposed.

Significant Assumptions and Judgments

In applying the requirements of Topic 842 the Company made significant assumptions and judgments related to determination of whether a contract contains a lease and the discount rate used for the lease.

In determining if any of the Company’s contracts contain a lease the Company made assumptions and judgments related to its ability to direct the use of any assets stated in the contract and the likelihood of renewing any short-term contracts for a period extending past twelve months.

The Company also made significant assumptions and judgments in determining an appropriate discount rate for property leases. These included using a consistent discount rate for a portfolio of leases entered into at varying dates, using the full 20-year term of the lease, excluding any options, and using the total minimum lease payments. The Company utilizes a third-party valuation firm in determining the discount rate, based on the above assumptions. For all other leases, the Company uses the discount rate implicit in the lease, or the Company’s incremental borrowing rate.

As the Company has adopted the practical expedient not to separate lease and non-lease components, no significant assumptions or judgments were necessary in allocating consideration between these components, for all classes of underlying assets.

The following table presents the Company’s total lease cost, disaggregated by underlying asset (in thousands):


	Thirteen Weeks Ended
	June 24, 2020						June 26, 2019
	Property		Equipment				Property		Equipment
	Leases		Leases		Total		Leases		Leases		Total
Finance lease cost:
Amortization of right-of-use assets	$	—	$	—	$	—	$	3	$	—	$	3
Interest on lease liabilities		5		—		5		7		—		7
Operating lease cost		6,545		307		6,852		6,585		327		6,912
Short-term lease cost		—		5		5		—		9		9
Variable lease cost		105		45		150		127		27		154
Sublease income		(763)		—		(763)		(511)		—		(511)
Total lease cost	$	5,892	$	357	$	6,249	$	6,211	$	363	$	6,574


	Twenty-Six Weeks Ended
	June 24, 2020						June 26, 2019
	Property		Equipment				Property		Equipment
	Leases		Leases		Total		Leases		Leases		Total
Finance lease cost:
Amortization of right-of-use assets	$	—	$	—	$	—	$	9	$	—	$	9
Interest on lease liabilities		11		—		11		15		—		15
Operating lease cost		13,075		614		13,689		13,187		654		13,841
Short-term lease cost		—		12		12		—		17		17
Variable lease cost		209		70		279		224		98		322
Sublease income		(1,541)		—		(1,541)		(901)		—		(901)
Total lease cost	$	11,754	$	696	$	12,450	$	12,534	$	769	$	13,303

The following table presents the Company’s total lease cost on the condensed consolidated statements of income (in thousands):


	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 24, 2020		June 26, 2019		June 24, 2020		June 26, 2019
Lease cost – Occupancy and other operating expenses	$	5,917	$	6,256	$	11,796	$	12,659
Lease cost – General & administrative		119		114		230		233
Lease cost – Depreciation and amortization		6		3		11		9
Lease cost – Interest expense				7		—		15
Lease cost - Closed-store reserve		207		194		413		387
Total lease cost	$	6,249	$	6,574	$	12,450	$	13,303

During the twenty-six weeks ended June 24, 2020 and June 26, 2019, the Company had the following cash and non-cash activities associated with its leases (in thousands):


	Twenty-Six Weeks Ended June 24, 2020								Twenty-Six Weeks Ended June 26, 2019
	Property			Equipment					Property			Equipment
	Leases			Leases			Total		Leases			Leases			Total
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows used for operating leases	$	9,269		$	619		$	9,888	$	12,361		$	654		$	13,015
Financing cash flows used for finance leases	$	16		$	—		$	16	$	53		$	—		$	53

Non-cash investing and financing activities:
Operating lease ROU assets obtained in exchange for lease liabilities:
Operating lease ROU assets	$	1,650		$	12		$	1,662		4,995			—			4,995
Derecognition of ROU assets due to terminations, impairment or modifications	$	(543)		$	(15)		$	(558)		—			—			—

Other Information
Weighted-average remaining lease term—finance leases		2.33			—					3.33			—
Weighted-average remaining lease term—operating leases		11.73			2.74					12.23			3.55
Weighted-average discount rate—finance leases		11.10	%		—					11.10	%		—
Weighted-average discount rate—operating leases		4.34	%		3.93	%				4.38	%		3.98	%

Information regarding the Company’s minimum future lease obligations as of June 24, 2020 is as follows (in thousands):


	Finance		Operating Leases
	Minimum		Minimum		Minimum
	Lease		Lease		Sublease
For the Years Ending	Payments		Payments		Income
December 30, 2020	$	27	$	14,838	$	1,393
December 29, 2021		54		28,909		2,887
December 28, 2022		45		25,975		3,284
December 27, 2023		—		23,627		3,318
December 25, 2024		—		21,333		3,203
Thereafter		—		141,408		27,265
Total	$	126	$	256,090	$	41,350
Less: imputed interest (2.33% - 11.10%)		(26)		(49,051)
Present value of lease obligations		100		207,039
Less: current maturities		(37)		(17,979)
Noncurrent portion	$	63	$	189,060

Information regarding the Company’s minimum future lease obligations as of December 25, 2019 is as follows (in thousands):


	Finance Leases		Operating Leases
	Minimum		Minimum		Minimum
	Lease		Lease		Sublease
For the Years Ending	Payments		Payments		Income
December 30, 2020	$	54	$	26,808	$	2,754
December 29, 2021		54		25,978		2,887
December 28, 2022		45		24,871		3,284
December 27, 2023		—		22,309		3,318
December 25, 2024		—		19,751		3,203
Thereafter		—		139,454		27,265
Total	$	153	$	259,171	$	42,711
Less: imputed interest (3.96% to 11.10%)		(36)		(45,273)
Present value of capital lease obligations		117		213,898
Less: current maturities		(34)		(16,406)
Noncurrent portion	$	83		197,492

Short-Term Leases

The Company has multiple short-term leases, which have terms of less than 12 months, and thus were excluded from the recognition requirements of Topic 842. The Company has recognized these lease payments in its consolidated statements of operations on a straight-line basis over the lease term and variable lease payments in the period in which the obligation for those payments is incurred.

Lessor

The Company is a lessor for certain property, facilities and equipment owned by the Company and leased to others, principally franchisees, under non-cancelable leases with initial terms ranging from three to 20 years. These lease agreements generally provide for a fixed base rent and, in some instances, contingent rent based on a percentage of gross operating profit or net revenues. All leases are considered operating leases.

For the leases in which the Company is the lessor, there are options to extend the lease. However, there are no terms and conditions to terminate the lease, no right to purchase premises and no residual value guarantees. Additionally, there are no related party leases.

The Company received $0.1 million and $0.2 million, respectively, of lease income from company-owned locations for the thirteen weeks ended June 24, 2020 and June 26, 2019. For each of the twenty-six weeks ended June 24, 2020 and June 26, 2019, the Company received $0.3 million of lease income from company-owned locations.

Basis of Presentation and Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 24, 2020

Accounting Policies [Abstract]

Basis of Presentation

Principles of Consolidation

Use of Estimates

Subsequent Events

subsequent to June 24, 2020, the Company reached an agreement in principle with the plaintiffs to resolve the lawsuit. See Note 7, “Commitments and Contingencies, Legal Matters” for more details.

Cash and Cash Equivalents

The Company considers all highly-liquid instruments with an original maturity of three months or less at the date of purchase to be cash equivalents.

Liquidity

Recovery of Securities Class Action Legal Expenses and Other Insurance Claims

Loss on Disposition of Restaurants

Concentration of Risk

Goodwill and Indefinite-Lived Intangible Assets

Goodwill and Indefinite Lived Intangible Assets

The Company performs an annual impairment test for goodwill during the fourth fiscal quarter of each year, or more frequently if impairment indicators arise.

Fair Value Measurements

●

Level 1: Quoted prices for identical instruments in active markets.

●

Level 3: Unobservable inputs used when little or no market data is available.

Long-Term Debt" for further discussion regarding our interest rate swaps. The following table presents fair value for the interest rate swap at June 24, 2020 (in thousands):


			Fair Value Measurements Using
	Fair Value		Level 1		Level 2		Level 3
Other non-current liabilities - Interest rate swap	$	1,408	$	—	$	1,408	$	—

The following table presents fair value for the interest rate swap at December 25, 2019 (in thousands):


			Fair Value Measurements Using
	Fair Value		Level 1		Level 2		Level 3
Other assets - Interest rate swap	$	360	$	—	$	360	$	—

The following non-financial instruments were measured at fair value, on a nonrecurring basis, as of and for the thirteen and twenty-six weeks ended June 24, 2020 (in thousands):


									Thirteen Weeks		Twenty-Six Weeks
			Fair Value Measurements at June 24, 2020 Using						Ended June 24, 2020		Ended June 24, 2020
	Total		Level 1		Level 2		Level 3		Impairment Losses		Impairment Losses
Certain property and equipment owned, net	$	—	$	—	$	—	$	—	$	52	$	1,429
Certain ROU assets, net	$	918	$	—	$	—	$	918	$	—	$	543

The following non-financial instruments were measured at fair value on a nonrecurring basis as of and for the thirteen and twenty-six weeks ended June 26, 2019 (in thousands):


									Thirteen Weeks		Twenty-Six Weeks
			Fair Value Measurements at June 26, 2019 Using						Ended June 26, 2019		Ended June 26, 2019
	Total		Level 1		Level 2		Level 3		Impairment Losses		Impairment Losses
Certain property and equipment owned, net	$	—	$	—	$	—	$	—	$	227	$	227

Impairment of Long-Lived Assets

Impairment of Long-Lived Assets and ROU Assets

Closed-Store Reserves

Derivative Financial Instruments

The Company uses an interest rate swap, a derivative instrument, to hedge interest rate risk and not for trading purposes. The derivative contract is entered into with a financial institution.

Income Taxes

The Company reviews its filing positions for all open tax years in all U.S. federal and state jurisdictions where the Company is required to file.

Recent Accounting Pronouncements

Recently Adopted Accounting Pronouncements

Recent Accounting Pronouncements Not Yet Adopted

Basis of Presentation and Summary of Significant Accounting Policies (Tables)

6 Months Ended

Jun. 24, 2020

Accounting Policies [Abstract]

Fair Value, Assets Measured on Recurring Basis [Table Text Block]

The following table presents fair value for the interest rate swap at June 24, 2020 (in thousands):


			Fair Value Measurements Using
	Fair Value		Level 1		Level 2		Level 3
Other non-current liabilities - Interest rate swap	$	1,408	$	—	$	1,408	$	—

The following table presents fair value for the interest rate swap at December 25, 2019 (in thousands):


			Fair Value Measurements Using
	Fair Value		Level 1		Level 2		Level 3
Other assets - Interest rate swap	$	360	$	—	$	360	$	—

Summary of Non-Financial Instruments Measured at Fair Value on Nonrecurring Basis

The following non-financial instruments were measured at fair value, on a nonrecurring basis, as of and for the thirteen and twenty-six weeks ended June 24, 2020 (in thousands):


									Thirteen Weeks		Twenty-Six Weeks
			Fair Value Measurements at June 24, 2020 Using						Ended June 24, 2020		Ended June 24, 2020
	Total		Level 1		Level 2		Level 3		Impairment Losses		Impairment Losses
Certain property and equipment owned, net	$	—	$	—	$	—	$	—	$	52	$	1,429
Certain ROU assets, net	$	918	$	—	$	—	$	918	$	—	$	543

The following non-financial instruments were measured at fair value on a nonrecurring basis as of and for the thirteen and twenty-six weeks ended June 26, 2019 (in thousands):


									Thirteen Weeks		Twenty-Six Weeks
			Fair Value Measurements at June 26, 2019 Using						Ended June 26, 2019		Ended June 26, 2019
	Total		Level 1		Level 2		Level 3		Impairment Losses		Impairment Losses
Certain property and equipment owned, net	$	—	$	—	$	—	$	—	$	227	$	227

Revenue from Contracts with Customers (Tables)

6 Months Ended

Jun. 24, 2020

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue

The following table presents our revenues disaggregated by revenue source and market (in thousands):


	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 24,		June 26,		June 24,		June 26,
	2020		2019		2020		2019
Core Market⁽¹⁾:
Company-operated restaurant revenue	$	81,370	$	88,808	$	167,285	$	174,114
Franchise revenue		3,208		4,174		6,716		7,673
Franchise advertising fee revenue		2,384		2,806		5,025		5,523
Total core market	$	86,962	$	95,788	$	179,026	$	187,310
Non-Core Market⁽²⁾:
Company-operated restaurant revenue	$	6,337	$	11,331	$	13,056	$	23,175
Franchise revenue		3,511		3,744		7,065		6,689
Franchise advertising fee revenue		2,794		2,877		5,620		5,543
Total non-core market	$	12,642	$	17,952	$	25,741	$	35,407
Total revenue	$	99,604	$	113,740	$	204,767	$	222,717

(1)	Core Market includes markets with existing company-operated restaurants at the time of the Company’s Initial Public Offering ("IPO") on July 28, 2014.

(2)	Non-Core Market includes markets entered into by the Company subsequent to the IPO date.

The following table presents our revenues disaggregated by geographic market:


	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 24, 2020		June 26, 2019		June 24, 2020		June 26, 2019
Greater Los Angeles area market	71.1	%	69.3	%	71.7	%	69.3	%
Other markets	28.9	%	30.7	%	28.3	%	30.7	%
Total	100	%	100	%	100	%	100	%

Schedule of Change in Franchise Contract Liability Balances

The following table provides information about the change in the franchise contract liability balances during the twenty-six weeks ended June 24, 2020 and June 26, 2019 (in thousands):


December 25, 2019	$	6,317
Revenue recognized - beginning balance		(544)
June 24, 2020	$	5,773

December 26, 2018	$	5,593
Revenue recognized - beginning balance		(203)
Additional contract liability		1,257
Revenue recognized - additional contract liability		(88)
June 26, 2019	$	6,559

Schedule of Estimated Revenue to be Recognized Related to Performance Obligations


Franchise revenues:
2020	$	323
2021		491
2022		410
2023		395
2024		381
Thereafter		3,773
Total	$	5,773

Leases Leases (Tables)

6 Months Ended

Jun. 24, 2020

Leases [Abstract]

Lease, Cost [Table Text Block]

The following table presents the Company’s total lease cost, disaggregated by underlying asset (in thousands):


	Thirteen Weeks Ended
	June 24, 2020						June 26, 2019
	Property		Equipment				Property		Equipment
	Leases		Leases		Total		Leases		Leases		Total
Finance lease cost:
Amortization of right-of-use assets	$	—	$	—	$	—	$	3	$	—	$	3
Interest on lease liabilities		5		—		5		7		—		7
Operating lease cost		6,545		307		6,852		6,585		327		6,912
Short-term lease cost		—		5		5		—		9		9
Variable lease cost		105		45		150		127		27		154
Sublease income		(763)		—		(763)		(511)		—		(511)
Total lease cost	$	5,892	$	357	$	6,249	$	6,211	$	363	$	6,574


	Twenty-Six Weeks Ended
	June 24, 2020						June 26, 2019
	Property		Equipment				Property		Equipment
	Leases		Leases		Total		Leases		Leases		Total
Finance lease cost:
Amortization of right-of-use assets	$	—	$	—	$	—	$	9	$	—	$	9
Interest on lease liabilities		11		—		11		15		—		15
Operating lease cost		13,075		614		13,689		13,187		654		13,841
Short-term lease cost		—		12		12		—		17		17
Variable lease cost		209		70		279		224		98		322
Sublease income		(1,541)		—		(1,541)		(901)		—		(901)
Total lease cost	$	11,754	$	696	$	12,450	$	12,534	$	769	$	13,303

The following table presents the Company’s total lease cost on the condensed consolidated statements of income (in thousands):


	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 24, 2020		June 26, 2019		June 24, 2020		June 26, 2019
Lease cost – Occupancy and other operating expenses	$	5,917	$	6,256	$	11,796	$	12,659
Lease cost – General & administrative		119		114		230		233
Lease cost – Depreciation and amortization		6		3		11		9
Lease cost – Interest expense				7		—		15
Lease cost - Closed-store reserve		207		194		413		387
Total lease cost	$	6,249	$	6,574	$	12,450	$	13,303

During the twenty-six weeks ended June 24, 2020 and June 26, 2019, the Company had the following cash and non-cash activities associated with its leases (in thousands):


	Twenty-Six Weeks Ended June 24, 2020								Twenty-Six Weeks Ended June 26, 2019
	Property			Equipment					Property			Equipment
	Leases			Leases			Total		Leases			Leases			Total
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows used for operating leases	$	9,269		$	619		$	9,888	$	12,361		$	654		$	13,015
Financing cash flows used for finance leases	$	16		$	—		$	16	$	53		$	—		$	53

Non-cash investing and financing activities:
Operating lease ROU assets obtained in exchange for lease liabilities:
Operating lease ROU assets	$	1,650		$	12		$	1,662		4,995			—			4,995
Derecognition of ROU assets due to terminations, impairment or modifications	$	(543)		$	(15)		$	(558)		—			—			—

Other Information
Weighted-average remaining lease term—finance leases		2.33			—					3.33			—
Weighted-average remaining lease term—operating leases		11.73			2.74					12.23			3.55
Weighted-average discount rate—finance leases		11.10	%		—					11.10	%		—
Weighted-average discount rate—operating leases		4.34	%		3.93	%				4.38	%		3.98	%

Schedule of Capital Leases

Information regarding the Company’s minimum future lease obligations as of June 24, 2020 is as follows (in thousands):


	Finance		Operating Leases
	Minimum		Minimum		Minimum
	Lease		Lease		Sublease
For the Years Ending	Payments		Payments		Income
December 30, 2020	$	27	$	14,838	$	1,393
December 29, 2021		54		28,909		2,887
December 28, 2022		45		25,975		3,284
December 27, 2023		—		23,627		3,318
December 25, 2024		—		21,333		3,203
Thereafter		—		141,408		27,265
Total	$	126	$	256,090	$	41,350
Less: imputed interest (2.33% - 11.10%)		(26)		(49,051)
Present value of lease obligations		100		207,039
Less: current maturities		(37)		(17,979)
Noncurrent portion	$	63	$	189,060

Information regarding the Company’s minimum future lease obligations as of December 25, 2019 is as follows (in thousands):


	Finance Leases		Operating Leases
	Minimum		Minimum		Minimum
	Lease		Lease		Sublease
For the Years Ending	Payments		Payments		Income
December 30, 2020	$	54	$	26,808	$	2,754
December 29, 2021		54		25,978		2,887
December 28, 2022		45		24,871		3,284
December 27, 2023		—		22,309		3,318
December 25, 2024		—		19,751		3,203
Thereafter		—		139,454		27,265
Total	$	153	$	259,171	$	42,711
Less: imputed interest (3.96% to 11.10%)		(36)		(45,273)
Present value of capital lease obligations		117		213,898
Less: current maturities		(34)		(16,406)
Noncurrent portion	$	83		197,492

Schedule of Operating Leases


	Finance		Operating Leases
	Minimum		Minimum		Minimum
	Lease		Lease		Sublease
For the Years Ending	Payments		Payments		Income
December 30, 2020	$	27	$	14,838	$	1,393
December 29, 2021		54		28,909		2,887
December 28, 2022		45		25,975		3,284
December 27, 2023		—		23,627		3,318
December 25, 2024		—		21,333		3,203
Thereafter		—		141,408		27,265
Total	$	126	$	256,090	$	41,350
Less: imputed interest (2.33% - 11.10%)		(26)		(49,051)
Present value of lease obligations		100		207,039
Less: current maturities		(37)		(17,979)
Noncurrent portion	$	63	$	189,060

Information regarding the Company’s minimum future lease obligations as of December 25, 2019 is as follows (in thousands):


	Finance Leases		Operating Leases
	Minimum		Minimum		Minimum
	Lease		Lease		Sublease
For the Years Ending	Payments		Payments		Income
December 30, 2020	$	54	$	26,808	$	2,754
December 29, 2021		54		25,978		2,887
December 28, 2022		45		24,871		3,284
December 27, 2023		—		22,309		3,318
December 25, 2024		—		19,751		3,203
Thereafter		—		139,454		27,265
Total	$	153	$	259,171	$	42,711
Less: imputed interest (3.96% to 11.10%)		(36)		(45,273)
Present value of capital lease obligations		117		213,898
Less: current maturities		(34)		(16,406)
Noncurrent portion	$	83		197,492

Basis of Presentation and Summary of Significant Accounting Policies - Additional Information (Details)			3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 25, 2020 USD ($) restaurant	Jul. 30, 2014	Jun. 24, 2020 USD ($) restaurant	Jun. 26, 2019 USD ($) restaurant	Jun. 24, 2020 USD ($) item segment restaurant	Jun. 26, 2019 USD ($) restaurant	Dec. 25, 2019 USD ($)
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Historical dine-in percentage					20.00%
Number of Restaurants Permanently Closed \| restaurant			0		0
Deferred April royalties percentage					50.00%
Deferred 2020 remodel and new restaurant build requirements percentage					100.00%
Repayments of Lines of Credit					$ 10,700,000	$ 15,000,000
Property and equipment owned, net			$ 84,262,000		$ 84,262,000		$ 91,778,000
Number of operating segments \| segment					1
Impairment of property and equipment			52,000	$ 227,000	$ 1,429,000	227,000
Impairment of Right-of-Use Assets					543,000
Asset Impairment Charges			100,000	200,000	1,972,000	227,000
Total amount of outstanding debt			138,800,000		138,800,000
Cash available			60,342,000		60,342,000		8,070,000
Insurance proceeds			100,000	10,000,000.0	100,000	10,000,000.0
Assets Held-for-sale, Not Part of Disposal Group, Current			0		0
Unrecognized tax benefits, accrual of interest or penalties			0		0		$ 0
Unrecognized tax benefits, interest or penalties expenses			0	0	0	0
Percentage of cash savings in taxes realized as a result of utilizing net operating losses payable to pre-IPO stockholders		85.00%
Tax Receivable Agreement (Income) Expenses			290,000	(94,000)	170,000	77,000
AMT Credits, CARES Act			$ 400,000		$ 400,000
Proceeds from disposition of restaurants						4,770,000
Loss on disposition of restaurants				$ (927,000)		$ (5,051,000)
Supplier Concentration Risk
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Number Of Suppliers \| item					1
Supplier Concentration Risk \| Supplier One \| Accounts Payable
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Percentage of concentration					44.50%		11.70%
Supplier Concentration Risk \| Largest Supplier One \| Purchased
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Percentage of concentration			26.40%	30.30%	27.00%	28.80%
Geographic Concentration Risk \| Revenue
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Percentage of concentration			100.00%	100.00%	100.00%	100.00%
Subsequent Event \| Letter of Credit
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Letter of credit released	$ 2,700,000
Fair Value, Measurements, Recurring [Member]
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Derivative Liability, Fair Value, Gross Liability			$ 1,408,000		$ 1,408,000
Derivative Liability, Fair Value, Gross Asset							$ 360,000
Fair Value, Measurements, Nonrecurring
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Property and equipment owned, net				$ 0		$ 0
Right-of-Use Assets, Net			918,000		918,000
Level 1 \| Fair Value, Measurements, Recurring [Member]
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Derivative Liability, Fair Value, Gross Liability			0		0
Derivative Liability, Fair Value, Gross Asset							0
Level 1 \| Fair Value, Measurements, Nonrecurring
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Property and equipment owned, net			0	0	0	0
Right-of-Use Assets, Net			0		0
Level 2 \| Fair Value, Measurements, Recurring [Member]
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Derivative Liability, Fair Value, Gross Liability			1,408,000		1,408,000
Derivative Liability, Fair Value, Gross Asset							360,000
Level 2 \| Fair Value, Measurements, Nonrecurring
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Property and equipment owned, net			0	0	0	0
Right-of-Use Assets, Net			0		0
Level 3 \| Fair Value, Measurements, Recurring [Member]
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Derivative Liability, Fair Value, Gross Liability			0		0
Derivative Liability, Fair Value, Gross Asset							$ 0
Level 3 \| Fair Value, Measurements, Nonrecurring
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Property and equipment owned, net				$ 0		$ 0
Right-of-Use Assets, Net			$ 918,000		$ 918,000
Texas
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Number of restaurants \| restaurant			1		1
Number of restaurants closed \| restaurant				1		1
Houston
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Number of restaurants fully open \| restaurant					9
Utah
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Number of restaurants fully open \| restaurant					1
California
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Number of restaurants \| restaurant			3	1	3	1
Impairment of property and equipment			$ 100,000	$ 200,000	$ 1,400,000	$ 200,000
Number of restaurants closed \| restaurant				1		1
Greater Los Angeles area market \| Geographic Concentration Risk \| Revenue
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Percentage of concentration			71.10%	69.30%	71.70%	69.30%
Closed Store
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Closed-store reserve expense			$ 400,000	$ 300,000	$ 900,000	$ 600,000
Company-operated
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Number of Restaurants Temporary Closed \| restaurant			31		31
Number of Restaurants Reopened \| restaurant			30		30
Number of Restaurants Remain Closed \| restaurant			1		1
Number of restaurants \| restaurant			196		196
Proceeds from disposition of restaurants						4,800,000
Loss on disposition of restaurants				$ (900,000)		$ (5,100,000)
Company-operated \| Minimum
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Temporary closure period					1 day
Company-operated \| Maximum
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Temporary closure period					3 days
Company-operated \| Subsequent Event
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Number of Restaurants Temporary Closed \| restaurant	36
Number of Restaurants Remain Closed \| restaurant	4
Company-operated \| Subsequent Event \| Minimum
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Temporary closure period	1 day
Company-operated \| Subsequent Event \| Maximum
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Temporary closure period	3 days
Company-operated \| San Francisco
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Number of Restaurants Sold \| restaurant				4		4
Company-operated \| Phoenix
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Number of Restaurants Sold \| restaurant				7		7
Franchised
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Number of Restaurants Temporary Closed \| restaurant			21		21
Number of Restaurants Reopened \| restaurant			17		17
Number of Restaurants Remain Closed \| restaurant			4		4
Number of restaurants \| restaurant			283		283
Franchised \| Subsequent Event
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Number of Restaurants Temporary Closed \| restaurant	11
Number of Restaurants Remain Closed \| restaurant	3

Long-Term Debt - Additional Information (Details) $ in Thousands		3 Months Ended		6 Months Ended
	Jul. 13, 2018 USD ($)	Jun. 24, 2020 USD ($)	Jun. 26, 2019 USD ($)	Jun. 24, 2020 USD ($)	Jun. 26, 2019 USD ($)	Dec. 25, 2019 USD ($)
Debt Instrument [Line Items]
Interest Expense, Debt		$ 293		$ 683	$ 0
Revolving line of credit		138,800		138,800		$ 97,000
Repayments of Lines of Credit				10,700	15,000
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months				(500)
Unrealized net losses arising during the period from interest rate swap		(296)		(1,755)
Reclassifications of losses into net income		81		42
Derivative liabilities fair value		1,367		$ 1,367		0
Revolving Credit Facility \| 2018 Credit Agreement
Debt Instrument [Line Items]
Senior secured revolving facility	$ 150,000
Senior secured revolving facility term	5 years
Debt Instrument, Maturity Date				Jul. 13, 2023
Revolving line of credit		138,800		$ 138,800
Amount of borrowings available		100		100
Proceeds from (Repayments of) Lines of Credit			$ 14,000	41,800	11,000
Repayments of Lines of Credit		$ 2,700	$ 12,000	10,700	$ 15,000
Principal payments prior to maturity				$ 0
Debt Instrument, Restrictive Covenants, Maximum Annual Repurchase or Redemption of Qualified Entity Interests	$ 1,000
Debt Instrument, Restrictive Covenants, Maximum Annual Redemption, Repurchase, Acquired Equity Interests	500
Debt Instrument, Restrictive Covenants, Maximum Annual Payment For Stock Option Plans, Employment Agreements and Incentive Plans	2,500
Debt Instrument, Restrictive Covenants, Maximum Annual Payment For Other Restricted Payments	$ 5,000
Debt Instrument, Covenant Description, Maximum Leverage Ratio	4.25
Revolving Credit Facility \| 2018 Credit Agreement \| Minimum
Debt Instrument [Line Items]
Debt instrument, interest rate		1.67%	3.90%	1.67%	3.90%
Revolving Credit Facility \| 2018 Credit Agreement \| Maximum
Debt Instrument [Line Items]
Debt instrument, interest rate		3.11%	6.00%	3.29%	6.00%
Revolving Credit Facility \| 2018 Credit Agreement \| Federal Funds Rate
Debt Instrument [Line Items]
Debt instrument basis percentage				0.50%
Revolving Credit Facility \| 2018 Credit Agreement \| LIBOR
Debt Instrument [Line Items]
Debt instrument basis percentage				1.00%
Revolving Credit Facility \| 2018 Credit Agreement \| LIBOR \| Minimum
Debt Instrument [Line Items]
Debt instrument basis percentage				1.25%
Revolving Credit Facility \| 2018 Credit Agreement \| LIBOR \| Maximum
Debt Instrument [Line Items]
Debt instrument basis percentage				2.25%
Revolving Credit Facility \| 2018 Credit Agreement \| Base Rate \| Minimum
Debt Instrument [Line Items]
Debt instrument basis percentage				0.25%
Revolving Credit Facility \| 2018 Credit Agreement \| Base Rate \| Maximum
Debt Instrument [Line Items]
Debt instrument basis percentage				1.25%
Revolving Credit Facility \| 2018 Credit Agreement \| Letter of Credit
Debt Instrument [Line Items]
Sub limit of revolving facility	$ 15,000
Letters of credit outstanding		$ 11,100		$ 11,100
Revolving Credit Facility \| 2018 Credit Agreement \| Swing Line Loans
Debt Instrument [Line Items]
Sub limit of revolving facility	$ 15,000
Interest Rate Swap [Member]
Debt Instrument [Line Items]
Derivative, Fixed Interest Rate		1.31%		1.31%
Derivative, Variable Interest Rate		1.50%		1.50%
Interest Expense, Debt		$ 81		$ 42	$ 0
Unrealized net losses arising during the period from interest rate swap		296		1,755	0
Reclassifications of losses into net income		81		42	0
Derivative Asset, Notional Amount						40,000
Derivative Liability, Notional Amount		40,000		40,000
Derivative assets fair value						$ 360
Derivative liabilities fair value		1,408		1,408
Hedged Debt Instrument [Member]
Debt Instrument [Line Items]
Interest Expense, Debt		$ 212		$ 641	$ 0

Net Income Per Share - Computation of Basic and Diluted Net Income per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 24, 2020	Jun. 26, 2019	Jun. 24, 2020	Jun. 26, 2019
Numerator:
Net income	$ 5,499	$ 14,087	$ 9,099	$ 15,000
Denominator:
Weighted-average shares outstanding-Basic (shares)	34,836,410	37,939,912	34,747,785	38,296,807
Weighted-average shares outstanding-Diluted (shares)	35,410,198	38,580,722	35,382,607	39,043,477
Net income per share-Basic (usd per share)	$ 0.16	$ 0.37	$ 0.26	$ 0.39
Net income per share-Diluted (usd per share)	$ 0.16	$ 0.37	$ 0.26	$ 0.38
Anti-dilutive securities not considered in diluted EPS calculation (shares)	545,881	733,449	565,118	438,547

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=109234566&loc=d3e22583-107794

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 11
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=109234566&loc=d3e22694-107794

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 45
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=121326447&loc=d3e1448-109256

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 4
-URI http://asc.fasb.org/extlink&oid=109234566&loc=d3e22595-107794

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 11
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=109234566&loc=d3e22694-107794

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 45
-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=121326447&loc=d3e1337-109256

Reference 7: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
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The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

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The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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+ Details

Leases (Details) $ in Thousands	3 Months Ended		6 Months Ended
Leases (Details) $ in Thousands	Jun. 24, 2020 USD ($) lease restaurant	Jun. 26, 2019 USD ($) restaurant	Jun. 24, 2020 USD ($) lease restaurant	Jun. 26, 2019 USD ($) restaurant	Dec. 25, 2019 USD ($)	Dec. 27, 2018 USD ($)
Lessee, Lease, Description [Line Items]
Operating Lease, Payments			$ 9,888	$ 13,015
Property held under operating leases, net ("ROU asset")	$ 184,308		184,308		$ 192,395	$ 205,200
Finance Lease, Right-of-Use Asset, Amortization		$ 3		9
Finance Lease, Interest Expense	5	7	11	15
Operating Lease, Cost	6,852	6,912	13,689	13,841
Short-term Lease, Cost	5	9	12	17
Variable Lease, Cost	150	154	279	322
Sublease Income	(763)	(511)	(1,541)	(901)
Total lease cost	6,249	$ 6,574	12,450	13,303
Operating Lease, Liability	$ 207,039		207,039		$ 213,898	$ 222,300
Finance Lease, Principal Payments			16	53
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability			1,662	$ 4,995
Derecognition of ROU assets due to terminations, impairment or modifications			$ (558)
Number Of Finance Leases \| lease	1		1
Number of Restaurants with lease modification \| restaurant	4	3	7	3
Operating Lease, Lease Income	$ 100	$ 200	$ 300	$ 300
Impairment of Right-of-Use Assets			$ 543
Initial lease term	20 years		20 years
Operating Lease, Impairment Loss	$ 500	0	$ 500	0
Depreciation and amortization [Member]
Lessee, Lease, Description [Line Items]
Total lease cost	6	3	11	9
Operating Expense [Member]
Lessee, Lease, Description [Line Items]
Total lease cost	5,917	6,256	11,796	12,659
General and Administrative Expense
Lessee, Lease, Description [Line Items]
Total lease cost	119	114	230	233
Interest Expense
Lessee, Lease, Description [Line Items]
Total lease cost		7		15
Restructuring Charges [Member]
Lessee, Lease, Description [Line Items]
Total lease cost	$ 207	$ 194	$ 413	$ 387
Minimum
Lessee, Lease, Description [Line Items]
Lessor, Operating Lease, Term of Contract	3 years		3 years
Renewal term	4 years		4 years
Maximum
Lessee, Lease, Description [Line Items]
Lessor, Operating Lease, Term of Contract	20 years		20 years
Renewal term	5 years		5 years
Texas
Lessee, Lease, Description [Line Items]
Number Of Restaurant Closed \| restaurant		1		1
Number of restaurants primarily responsible for impairment \| restaurant			1
Property lease modification [Member]
Lessee, Lease, Description [Line Items]
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability	$ 1,400	$ 1,200	$ 1,700	$ 1,200
Property Lease [Member]
Lessee, Lease, Description [Line Items]
Operating Lease, Payments			9,269	12,361
Finance Lease, Right-of-Use Asset, Amortization		3		9
Finance Lease, Interest Expense	5	7	11	15
Operating Lease, Cost	6,545	6,585	13,075	13,187
Variable Lease, Cost	105	127	209	224
Sublease Income	(763)	(511)	(1,541)	(901)
Total lease cost	$ 5,892	$ 6,211	11,754	12,534
Finance Lease, Principal Payments			16	53
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability			1,650	$ 4,995
Derecognition of ROU assets due to terminations, impairment or modifications			$ (543)
Finance Lease, Weighted Average Remaining Lease Term	2 years 3 months 29 days	3 years 3 months 29 days	2 years 3 months 29 days	3 years 3 months 29 days
Operating Lease, Weighted Average Discount Rate, Percent	4.34%	4.38%	4.34%	4.38%
Operating Lease, Weighted Average Remaining Lease Term	11 years 8 months 23 days	12 years 2 months 23 days	11 years 8 months 23 days	12 years 2 months 23 days
Finance Lease, Weighted Average Discount Rate, Percent	11.10%	11.10%	11.10%	11.10%
Equipment Lease [Member]
Lessee, Lease, Description [Line Items]
Operating Lease, Payments			$ 619	$ 654
Operating Lease, Cost	$ 307	$ 327	614	654
Short-term Lease, Cost	5	9	12	17
Variable Lease, Cost	45	27	70	98
Total lease cost	$ 357	$ 363	696	$ 769
Finance Lease, Principal Payments			0
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability			12
Derecognition of ROU assets due to terminations, impairment or modifications			$ (15)
Finance Lease, Weighted Average Remaining Lease Term	0 years	0 years	0 years	0 years
Operating Lease, Weighted Average Discount Rate, Percent	3.93%	3.98%	3.93%	3.98%
Operating Lease, Weighted Average Remaining Lease Term	2 years 8 months 26 days	3 years 6 months 18 days	2 years 8 months 26 days	3 years 6 months 18 days
Finance Lease, Weighted Average Discount Rate, Percent	0.00%		0.00%
Lease Not Yet Commenced [Member]
Lessee, Lease, Description [Line Items]
Number Of Leases \| lease			0

Leases - Minimum Future Lease Obligations (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 24, 2020	Dec. 25, 2019	Dec. 27, 2018
Lessee, Lease, Description [Line Items]
Finance Lease, Liability, Payments, Remainder of Fiscal Year	$ 27	$ 54
Operating Leases, Future Minimum Payments Due, Remainder of Fiscal Year	14,838	26,808
Operating Leases, Future Minimum Payments Due, Future Minimum Sublease Rentals, Remainder Of Fiscal Year	1,393	2,754
Operating Leases, Future Minimum Payments Due, Future Minimum Sublease Rentals, Next Twelve Months	2,887	2,887
Finance Lease, Liability, Payments Due Year One	54	54
Finance Lease, Liability, Payments, Due Year Two	45	45
Lessee, Operating Lease, Liability, to be Paid, Year One	28,909	25,978
Operating Leases, Future Minimum Payments, Due in Two Years	25,975	24,871
Operating Leases, Future Minimum Payments Due, Future Minimum Sublease Rentals, within Two Years	3,284	3,284
Finance Lease, Liability, Payments, Due Year Three	0	0
Operating Leases, Future Minimum Payments, Due in Three Years	23,627	22,309
Operating Leases, Future Minimum Payments Due, Future Minimum Sublease Rentals, within Three Years	3,318	3,318
Finance Lease, Liability, Payments, Due Year Four	0	0
Operating Leases, Future Minimum Payments, Due in Four Years	21,333	19,751
Operating Leases, Future Minimum Payments Due, Future Minimum Sublease Rentals, within Four Years	3,203	3,203
Thereafter	0	0
Thereafter	141,408	139,454
Thereafter	27,265	27,265
Total	126	153
Total	256,090	259,171
Total	41,350	42,711
Lessee, Operating Lease, Liability, Undiscounted Excess Amount	(49,051)	(45,273)
Present value of lease obligations	100	117
Finance Lease, Liability, Undiscounted Excess Amount	(26)	(36)
Less: current maturities	(37)	(34)
Obligations under finance leases, net of current portion	63	83
Finance Lease, Liability, Current	(37)	(34)
Present value of lease obligations	207,039	213,898	$ 222,300
Obligations under operating leases, net of current portion	189,060	197,492
Less: current maturities	(17,979)	(16,406)
Finance Lease, Liability, Noncurrent	$ 63	$ 83
Minimum
Lessee, Lease, Description [Line Items]
Imputed interest rate	2.33%	3.96%
Maximum
Lessee, Lease, Description [Line Items]
Imputed interest rate	11.10%	11.10%

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares	Jun. 24, 2020	Dec. 25, 2019
Statement of Financial Position [Abstract]
Preferred stock, par value (usd per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (shares)	100,000,000	100,000,000
Preferred stock, shares issued (shares)	0	0
Preferred stock, shares outstanding (shares)	0	0
Common stock, par value (usd per share)	$ 0.01	$ 0.01
Common stock, shares authorized (shares)	200,000,000	200,000,000
Common stock, shares issued (shares)	35,854,122	35,126,582
Common stock, shares outstanding (shares)	35,854,122	35,126,582

Property and Equipment - Schedule of Costs and Related Accumulated Depreciation and Amortization of Major Classes of Property (Details) - USD ($) $ in Thousands	Jun. 24, 2020	Dec. 25, 2019
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 236,418	$ 236,564
Less: accumulated depreciation and amortization	(152,156)	(144,786)
Property and equipment, net	84,262	91,778
Land
Property, Plant and Equipment [Line Items]
Property and equipment, gross	12,323	12,323
Buildings and improvements
Property, Plant and Equipment [Line Items]
Property and equipment, gross	147,048	144,794
Other property and equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	75,604	75,234
Construction in progress
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 1,443	$ 4,213

Stock-Based Compensation - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 24, 2020	Jun. 26, 2019	Jun. 24, 2020	Jun. 26, 2019	Dec. 25, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock, options outstanding (shares)	1,641,851		1,641,851		2,077,570
Common stock, options vested (shares)			1,258,437
Common stock, options unvested (shares)	383,414		383,414
Unvested restricted shares outstanding (shares)	818,021		818,021		588,008
Stock-based compensation expense	$ 700	$ 600	$ 1,261	$ 1,129
Premium Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock, options outstanding (shares)	820,342		820,342
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense, recognition period			2 years 5 months 15 days
Unrecognized compensation expense	$ 1,300		$ 1,300
Restricted Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense, recognition period			3 years 2 months 19 days
Unvested restricted shares outstanding (shares)	733,885		733,885
Unrecognized compensation expense	$ 8,000		$ 8,000
Performance Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense, recognition period			2 years 10 months 13 days
Unvested restricted shares outstanding (shares)	36,058		36,058
Unrecognized compensation expense	$ 100		$ 100
Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense, recognition period			1 year 10 months 13 days
Unrecognized compensation expense	$ 500		$ 500
Unvested restricted shares outstanding (shares)	48,078		48,078

Stock-Based Compensation - Changes in Stock Options (Details) - $ / shares	6 Months Ended
	Jun. 24, 2020
Shares
Outstanding-beginning balance (shares)	2,077,570
Exercised (shares)	(372,556)
Forfeited, cancelled or expired (shares)	(63,163)
Outstanding-ending balance (shares)	1,641,851
Vested and expected to vest at end of period (shares)	1,635,204
Exercisable at end of period (shares)	1,258,437
Weighted-Average Exercise Price
Outstanding-beginning balance (usd per share)	$ 8.14
Exercised (usd per share)	5.81
Forfeited, cancelled or expired (usd per share)	11.56
Outstanding-ending balance (usd per share)	8.53
Vested and expected to vest at end of period (usd per share)	8.52
Exercisable at end of period (usd per share)	$ 7.66

Stock-Based Compensation - Schedule of Changes in Restricted Shares (Details)	6 Months Ended
	Jun. 24, 2020 $ / shares shares
Shares
Unvested shares, beginning balance (shares) \| shares	588,008
Granted (shares) \| shares	412,224
Released (shares) \| shares	(108,714)
Forfeited, cancelled, or expired (shares) \| shares	(73,497)
Unvested shares, ending balance (shares) \| shares	818,021
Weighted-Average Fair Value
Unvested shares Weighted-Average Fair Value, beginning balance (usd per share) \| $ / shares	$ 11.23
Granted, Weighted-Average Fair Value (usd per share) \| $ / shares	12.46
Released, Weighted-Average Fair Value (usd per share) \| $ / shares	11.79
Forfeited, cancelled, or expired, Weighted-Average Fair Value (usd per share) \| $ / shares	12.21
Unvested shares Weighted-Average Fair Value, ending balance (usd per share) \| $ / shares	$ 11.69

Other Accrued Expenses and Current Liabilities - Schedule of Other Accrued Expenses and Current Liabilities (Detail) - USD ($) $ in Thousands	Jun. 24, 2020	Dec. 25, 2019
Payables and Accruals [Abstract]
Accrued sales and property taxes	$ 3,618	$ 4,665
Gift card liability	2,811	3,006
Accrued legal settlements and professional fees	3,326	16,901
Deferred franchise and development fees	592	705
Current portion of lease payment deferrals	2,523
Other	3,506	3,320
Total other accrued expenses and current liabilities	$ 16,376	$ 28,597

Other Noncurrent Liabilities - Schedule of Other Noncurrent Liabilities (Detail) - USD ($) $ in Thousands	Jun. 24, 2020	Dec. 25, 2019
Payables and Accruals [Abstract]
Deferred franchise and development fees	$ 5,181	$ 5,612
Derivative liability	1,367	0
Lease payment deferrals - net of current portion	805	0
Other	1,625	67
Total other noncurrent liabilities	$ 8,978	$ 5,679

Commitments and Contingencies - Additional Information (Details)							6 Months Ended
	Jan. 27, 2020 USD ($)	Jan. 24, 2019 class	Aug. 01, 2018 company	May 01, 2018 company	Dec. 11, 2017 company	Apr. 24, 2017	Jun. 24, 2020 USD ($) agreement lease lawsuit	Apr. 17, 2020 USD ($)	Dec. 25, 2019 USD ($)	Dec. 26, 2018 USD ($)
Officers
Other Commitments [Line Items]
Number of at-will employment agreements \| agreement							3
Property Lease Guarantee
Other Commitments [Line Items]
Accrual associated with loss contingencies							$ 100,000
Number of leases assigned to franchisees \| lease							4
Latest lease expiration year							2036
Contingent lease obligations, maximum exposure							$ 2,800,000
Contingent lease obligations, maximum exposure, if discounted at estimated pre-tax cost of debt							2,600,000
Chicken Acquisition Corp
Other Commitments [Line Items]
Purchase commitments, estimated obligations							$ 11,100,000
Elliott Olvera, et al v. El Pollo Loco, Inc., et al
Other Commitments [Line Items]
Date of class action filed in court							Feb. 24, 2014
Accrual associated with loss contingencies							$ 0			$ 16,300,000
Number of putative class members \| class		32,000
Daniel Turocy, et al. and Ron Huston et al v. El Pollo Loco Holdings, Inc., et al
Other Commitments [Line Items]
Number of lawsuits consolidated \| lawsuit							2
Accrual associated with loss contingencies									$ 20,000,000.0
Amount of option value removed							$ 5
Janice P. Handlers-Bryman and Michael D. Bryman v. El Pollo Loco, Inc
Other Commitments [Line Items]
Value of damages awarded	$ 249,728
Number of days before the commencement of trial, plaintiff filed voluntary dismissal						4 days
Number of new company-operated El Pollo Loco restaurants constructing \| company			2	2	2
Attorney fees	$ 1,391,703						2,500,000
Post judgement interest rate	10.00%
Litigation Settlement, Expense	$ 1,391,703						2,500,000
Janice P. Handlers-Bryman and Michael D. Bryman v. El Pollo Loco, Inc \| Letter of Credit
Other Commitments [Line Items]
Line of credit								$ 2,651,342
Janice P. Handlers-Bryman and Michael D. Bryman v. El Pollo Loco, Inc \| Impact Damages
Other Commitments [Line Items]
Value of damages awarded							4,356,600
Janice P. Handlers-Bryman and Michael D. Bryman v. El Pollo Loco, Inc \| Lost Opportunity Damages
Other Commitments [Line Items]
Value of damages awarded							4,481,206
Janice P. Handlers-Bryman and Michael D. Bryman v. El Pollo Loco, Inc \| Total Damages
Other Commitments [Line Items]
Value of damages awarded							$ 8,837,806

Net Income Per Share - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 26, 2019	Jun. 26, 2019	Apr. 30, 2019	Aug. 02, 2018
Equity, Class of Treasury Stock [Line Items]
Payment for repurchase of shares		$ 18,151
2018 Stock Repurchase Plan
Equity, Class of Treasury Stock [Line Items]
Authorized amount under share repurchase agreement				$ 20,000
Repurchase of shares	1,303,282	1,558,836
Payment for repurchase of shares	$ 14,900	$ 18,300
2019 Stock Repurchase Plan
Equity, Class of Treasury Stock [Line Items]
Authorized amount under share repurchase agreement			$ 30,000

Related Party Transactions - Additional Information (Details)	6 Months Ended
	Jun. 24, 2020
Trimaran Pollo Partners, LLC
Related Party Transaction [Line Items]
Company's outstanding common stock owned by Trimaran Pollo Partners, L.L.C.	46.70%
Trimaran Pollo Partners, LLC \| Minimum
Related Party Transaction [Line Items]
Outstanding membership interest, percentage	40.00%
Trimaran Pollo Partners, LLC \| Noncontrolling Interest [Member] \| Minimum
Related Party Transaction [Line Items]
Ownership percentage by stockholders	40.00%

Revenue from Contracts with Customers - Additional Information (Details)	6 Months Ended
	Jun. 24, 2020 USD ($) item	Dec. 25, 2019 USD ($)
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Number of revenue streams \| item	2
Loyalty Rewards Program, Points Needed For One Reward	$ 100
Loyalty Rewards Program, Award Earned	$ 10
Loyalty Rewards Program, Expiration Period For Inactivity	1 year
Loyalty Reward Program, unused reward expiration period	6 months
Points transferred to reward amount, revenue	$ 10,000
Accrued Loyalty Rewards Program Liability, Current	$ 1,100,000	$ 1,100,000
Loyalty Rewards Program, Expected Loyalty Points Redemption Period	1 year
Unsatisfied performance obligations	$ 5,773,000
Franchise Rights [Member]
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Finite-Lived Intangible Asset, Useful Life	20 years
Finite-Lived Intangible Asset, Useful Life Renewal Period	20 years
Hardware Services [Member]
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Unsatisfied performance obligations	$ 0
Minimum
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Contract with Customer, Liability, Revenue Recognized, Period	10 years
Maximum
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Contract with Customer, Liability, Revenue Recognized, Period	20 years

Revenue from Contracts with Customers - Change in Contract Liabilities (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 24, 2020	Jun. 26, 2019
Change in Contract with Customer, Liability [Roll Forward]
Contract with Customer, Liability	$ 6,317	$ 5,593
Revenue recognized - beginning balance	(544)	(203)
Additional contract liability		1,257
Revenue recognized - additional contract liability		(88)
Contract with Customer, Liability	$ 5,773	$ 6,559

Revenue from Contracts with Customers - Unsatisfied Performance Obligation (Details) $ in Thousands	Jun. 24, 2020 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Unsatisfied performance obligations	$ 5,773
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-01 \| Franchise Contract
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	6 months
Unsatisfied performance obligations	$ 323
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01 \| Franchise Contract
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Unsatisfied performance obligations	$ 491
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 \| Franchise Contract
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Unsatisfied performance obligations	$ 410
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 \| Franchise Contract
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Unsatisfied performance obligations	$ 395
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 \| Franchise Contract
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Unsatisfied performance obligations	$ 381
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 \| Franchise Contract
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Unsatisfied performance obligations	$ 3,773