0001606366-22-000050 | 10-Q | XBRL Viewer | EL Pollo Loco Holdings INC

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Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Jun. 29, 2022	Jul. 29, 2022
Document And Entity Information [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 29, 2022
Document Transition Report	false
Entity File Number	001-36556
Entity Registrant Name	EL POLLO LOCO HOLDINGS, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	20-3563182
Entity Address, Address Line One	3535 Harbor Blvd.
Entity Address, Address Line Two	Suite 100
Entity Address, City or Town	Costa Mesa
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	92626
City Area Code	714
Local Phone Number	599-5000
Title of 12(b) Security	Common Stock, par value $0.01 per share
Trading Symbol	LOCO
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Emerging Growth Company	false
Small Business Entity	false
Shell Company	false
Entity Common Stock, Shares Outstanding		37,002,513
Current Fiscal Year End Date	--12-28
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q2
Entity Central Index Key	0001606366
Amendment Flag	false

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 29, 2022	Dec. 29, 2021
Current assets:
Cash and cash equivalents	$ 34,311	$ 30,046
Accounts and other receivables, net	13,999	13,407
Inventories	2,250	2,318
Prepaid expenses and other current assets	3,470	3,732
Income tax receivable	1,428
Total current assets	55,458	49,503
Property and equipment, net	76,073	75,668
Property and equipment held under finance lease, net	1,598	1,635
Property and equipment held under operating leases, net ("ROU asset")	170,816	171,981
Goodwill	248,674	248,674
Trademarks	61,888	61,888
Deferred tax assets	2,017	2,245
Other assets	2,879	2,192
Total assets	619,403	613,786
Current liabilities:
Current portion of obligations under finance leases	109	143
Current portion of obligations under operating leases	20,154	19,959
Accounts payable	9,288	10,626
Accrued salaries and vacation	9,648	11,539
Accrued insurance	11,474	11,193
Accrued income taxes payable		889
Current portion of income tax receivable agreement payable	440	437
Other accrued expenses and current liabilities	19,020	19,796
Total current liabilities	70,133	74,582
Revolver loan	40,000	40,000
Obligations under finance leases, net of current portion	1,681	1,712
Obligations under operating leases, net of current portion	170,354	171,651
Deferred taxes	6,712	5,464
Income tax receivable agreement payable, net of current portion	782	1,101
Other noncurrent liabilities	5,898	8,653
Total liabilities	295,560	303,163
Commitments and contingencies (Note 7)
Stockholders' equity
Preferred stock, $0.01 par value, 100,000,000 shares authorized; none issued or outstanding
Common stock, $0.01 par value, 200,000,000 shares authorized; 37,002,513 and 36,601,648 shares issued and outstanding as June 29, 2022 and December 29, 2021, respectively	369	365
Additional paid-in-capital	346,095	342,941
Accumulated deficit	(23,137)	(32,393)
Accumulated other comprehensive income (loss)	516	(290)
Total stockholders' equity	323,843	310,623
Total liabilities and stockholders' equity	$ 619,403	$ 613,786

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 29, 2022	Dec. 29, 2021
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)	37,002,513	36,601,648
Common stock, shares outstanding (shares)	37,002,513	36,601,648

Condensed Consolidated Statements of Income - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 29, 2022	Jun. 30, 2021	Jun. 29, 2022	Jun. 30, 2021
Revenue
Total revenue	$ 124,111	$ 121,985	$ 234,159	$ 229,706
Cost of operations
Food and paper cost	31,691	27,882	59,423	52,273
Labor and related expenses	33,015	31,526	65,687	62,258
Occupancy and other operating expenses	25,832	25,336	49,677	49,180
Company restaurant expenses	90,538	84,744	174,787	163,711
General and administrative expenses	9,679	10,523	19,633	20,997
Franchise expenses	9,557	8,161	18,288	15,912
Depreciation and amortization	3,618	3,917	7,215	7,855
Loss on disposal of assets	42	85	108	111
Loss on assets held for sale		1,524		1,524
Impairment and closed-store reserves	248	360	379	924
Total expenses	113,682	109,314	220,410	211,034
Income from operations	10,429	12,671	13,749	18,672
Interest expense, net	419	433	849	950
Income tax receivable agreement income	(186)	27	(316)	(50)
Income before provision for income taxes	10,196	12,211	13,216	17,772
Provision for income taxes	3,055	3,393	3,960	4,990
Net income	$ 7,141	$ 8,818	$ 9,256	$ 12,782
Net income per share
Basic (usd per share)	$ 0.20	$ 0.25	$ 0.26	$ 0.36
Diluted (usd per share)	$ 0.20	$ 0.24	$ 0.25	$ 0.35
Weighted-average shares used in computing net income per share
Basic (shares)	36,331,099	35,927,781	36,278,423	35,861,493
Diluted (shares)	36,473,960	36,416,686	36,478,808	36,423,394
Company-operated restaurant revenue
Revenue
Total revenue	$ 106,454	$ 106,970	$ 200,411	$ 201,131
Franchise revenue
Revenue
Total revenue	10,064	8,389	19,319	16,001
Franchise advertising fee revenue
Revenue
Total revenue	$ 7,593	$ 6,626	$ 14,429	$ 12,574

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 29, 2022	Jun. 30, 2021	Jun. 29, 2022	Jun. 30, 2021
Statements of Other Comprehensive Income [Abstract]
Net income	$ 7,141	$ 8,818	$ 9,256	$ 12,782
Unrealized net gains arising during the period from interest rate swap	347	(2)	931	76
Reclassifications of losses into net income	55	119	172	234
Income tax expense	(108)	(32)	(297)	(84)
Other comprehensive income, net of taxes	294	85	806	226
Comprehensive income	$ 7,435	$ 8,903	$ 10,062	$ 13,008

- Definition

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

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+ Details

Condensed Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Accumulated Other Comprehensive Income (Loss)	Total
Beginning balance (shares) at Dec. 30, 2020	36,423,505
Beginning balance at Dec. 30, 2020	$ 364	$ 339,561	$ (61,514)	$ (833)	$ 277,578
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation		1,894			1,894
Issuance of common stock related to restricted shares	$ 2	(2)
Issuance of common stock related to restricted shares (shares)	206,098
Issuance of common stock upon exercise of stock options	$ 1	565			566
Issuance of common stock upon exercise of stock options (shares)	91,544
Shares repurchased for employee tax withholdings		(660)			(660)
Shares repurchased for employee tax withholdings (shares)	(37,938)
Forfeiture of common stock related to restricted shares (shares)	(45,448)
Other comprehensive (loss) income, net of tax				226	226
Net income			12,782		12,782
Ending balance (shares) at Jun. 30, 2021	36,637,761
Ending balance at Jun. 30, 2021	$ 367	341,358	(48,732)	(607)	292,386
Beginning balance (shares) at Mar. 31, 2021	36,478,683
Beginning balance at Mar. 31, 2021	$ 365	340,739	(57,550)	(692)	282,862
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation		1,041			1,041
Issuance of common stock related to restricted shares	$ 2	(2)
Issuance of common stock related to restricted shares (shares)	206,098
Issuance of common stock upon exercise of stock options		240			240
Issuance of common stock upon exercise of stock options (shares)	30,125
Shares repurchased for employee tax withholdings		(660)			(660)
Shares repurchased for employee tax withholdings (shares)	(37,938)
Forfeiture of common stock related to restricted shares (shares)	(39,207)
Other comprehensive (loss) income, net of tax				85	85
Net income			8,818		8,818
Ending balance (shares) at Jun. 30, 2021	36,637,761
Ending balance at Jun. 30, 2021	$ 367	341,358	(48,732)	(607)	292,386
Beginning balance (shares) at Dec. 29, 2021	36,601,648
Beginning balance at Dec. 29, 2021	$ 365	342,941	(32,393)	(290)	310,623
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation		1,796			1,796
Issuance of common stock related to restricted shares	$ 3	(3)
Issuance of common stock related to restricted shares (shares)	298,638
Issuance of common stock upon exercise of stock options	$ 1	1,579			$ 1,580
Issuance of common stock upon exercise of stock options (shares)	150,475				150,475
Shares repurchased for employee tax withholdings		(218)			$ (218)
Shares repurchased for employee tax withholdings (shares)	(20,317)
Forfeiture of common stock related to restricted shares (shares)	(27,931)				(27,931)
Other comprehensive (loss) income, net of tax				806	$ 806
Net income			9,256		9,256
Ending balance (shares) at Jun. 29, 2022	37,002,513
Ending balance at Jun. 29, 2022	$ 369	346,095	(23,137)	516	323,843
Beginning balance (shares) at Mar. 30, 2022	36,743,496
Beginning balance at Mar. 30, 2022	$ 366	345,296	(30,278)	222	315,606
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation		970			970
Issuance of common stock related to restricted shares	$ 3	(3)
Issuance of common stock related to restricted shares (shares)	298,638
Issuance of common stock upon exercise of stock options		50			50
Issuance of common stock upon exercise of stock options (shares)	8,627
Shares repurchased for employee tax withholdings		(218)			(218)
Shares repurchased for employee tax withholdings (shares)	(20,317)
Forfeiture of common stock related to restricted shares (shares)	(27,931)
Other comprehensive (loss) income, net of tax				294	294
Net income			7,141		7,141
Ending balance (shares) at Jun. 29, 2022	37,002,513
Ending balance at Jun. 29, 2022	$ 369	$ 346,095	$ (23,137)	$ 516	$ 323,843

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 29, 2022	Jun. 30, 2021	Jun. 29, 2022	Jun. 30, 2021
Cash flows from operating activities:
Net income	$ 7,141	$ 8,818	$ 9,256	$ 12,782
Adjustments to reconcile net income to net cash flows provided by provided by operating activities:
Depreciation and amortization	3,618	3,917	7,215	7,855
Stock-based compensation expense	1,000	1,000	1,796	1,894
Income tax receivable agreement income	(186)	27	(316)	(50)
Loss on assets held for sale		1,524		1,524
Loss on disposal of assets	42	85	108	111
Impairment of property and equipment	200	400	253	666
Amortization of deferred financing costs			126	126
Deferred income taxes, net			1,180	881
Changes in operating assets and liabilities:
Accounts and other receivables			(592)	(507)
Inventories			68	73
Prepaid expenses and other current assets			262	558
Income taxes receivable			(2,316)	2,014
Other assets			(812)	(312)
Accounts payable			(454)	(557)
Accrued salaries and vacation			(1,891)	279
Accrued insurance			281	362
Other accrued expenses and liabilities			(2,344)	(1,075)
Net cash flows provided by operating activities			11,820	26,624
Cash flows from investing activities:
Proceeds from disposition of restaurants				4,556
Purchase of property and equipment			(8,831)	(8,828)
Net cash flows used in investing activities			(8,831)	(4,272)
Cash flows from financing activities:
Payments on revolver and swingline loan				(22,800)
Minimum tax withholdings related to net share settlements			(218)	(660)
Proceeds from issuance of common stock upon exercise of stock options, net of expenses			1,580	566
Payment of obligations under finance leases			(86)	(53)
Net cash flows provided by (used in) financing activities			1,276	(22,947)
Increase (decrease) in cash and cash equivalents			4,265	(595)
Cash and cash equivalents, beginning of period			30,046	13,219
Cash and cash equivalents, end of period	$ 34,311	$ 12,624	34,311	12,624
Supplemental cash flow information
Cash paid during the period for interest			531	598
Cash paid during the period for income taxes			5,097	2,094
Unpaid purchases of property and equipment			$ 1,388	$ 1,038

Basis of Presentation and Summary of Significant Accounting Policies

6 Months Ended

Jun. 29, 2022

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 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 29, 2022, the Company operated 188 and franchised 293 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 statement of the Company’s condensed 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 29, 2021.

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 2022 and 2021 are both 52-week years, ending on December 28, 2022 and December 29, 2021, respectively. 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, “Long-Term Debt”), 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

While all of the Company’s restaurants had dining rooms open as of June 29, 2022, the Company continues to experience staffing challenges, which resulted in reduced operating hours and service channels at some of the Company restaurants, as well as higher wage inflation, overtime costs and other labor related costs. Further, the Company experienced inflationary pressures and supply chain disruptions that resulted in increased commodity prices and impacted the Company’s business and results of operations during the thirteen and twenty-six weeks ended June 29, 2022. The Company expects these pressures to continue during the rest of fiscal 2022. During the thirteen and twenty-six weeks ended June 29, 2022, the Company incurred $0.3 million and $2.6 million, respectively, in COVID-19 related expenses, primarily due to leaves of absence and overtime pay. During the thirteen and twenty-six weeks ended June 30, 2021, the Company incurred $0.2 million and $3.0 million, respectively, in COVID-19 related expenses, primarily due to leaves of absence and overtime pay.

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 condensed 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 condensed consolidated financial condition, liquidity, and future results of operations is uncertain.

Cash and Cash Equivalents

The Company considers all 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 its debt, lease obligations and working capital and general corporate needs. At June 29, 2022, the Company’s total debt was $40.0 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 $34.3 million at June 29, 2022 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.

Recently Adopted Accounting Pronouncements

None.

Subsequent Events

2022 Credit Agreement

On July 27, 2022, the Company refinanced the 2018 Revolver, pursuant to a credit agreement (the “2022 Credit Agreement”) among EPL, as borrower, 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 million five-year senior secured revolving facility (the “2022 Revolver”). In connection with the refinancing, the 2018 Credit Agreement (as defined below) was terminated. The 2022 Revolver includes a sub limit of $15.0 million for letters of credit and a sub limit of $15.0 million for swingline loans. On July 29, 2022, the Company made a $20.0 million payment to the 2022 Revolver and the outstanding balance as of August 4, 2022 was $20.0 million. The proceeds of the 2022 Revolver were used to refinance and terminate the 2018 Revolver and may also be used from time to time for general corporate purposes. The 2022 Revolver will mature on July 27, 2027. The obligations of EPL under the 2022 Credit Agreement and related loan documents are guaranteed by the Company and Intermediate and the obligations of each of the Company, EPL and Intermediate under the 2022 Credit Agreement and related loan documents are secured by a first priority (subject to permitted liens) lien on substantially all of their respective assets (subject to customary exceptions).

Borrowings under the 2022 Credit Agreement (other than any swingline loans) bear interest, at the borrower’s option, at rates based upon either the secured overnight financing rate (“SOFR”) 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 of Bank of America prime rate, or (c) Term SOFR with a term of one-month plus 1.00%. For Term SOFR 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 2022 Revolver may be repaid and reborrowed.

The 2022 Credit Agreement includes negative covenants and financial covenants, including, among others, the following (all subject to certain exceptions): a maximum lease-adjusted consolidated leverage ratio covenant, a minimum consolidated fixed charge coverage ratio, and limitations on (among others) indebtedness, liens, investments, asset sales, mergers, consolidations, liquidations, dispositions, restricted payments, negative pledges, transactions with affiliates, sale-leaseback transactions and prepayments of certain debt. The 2022 Credit Agreement also includes certain affirmative covenants and events of default.

In connection with the Company’s entry into the 2022 Credit Agreement, it terminated the interest rate swap previously used to hedge interest rate risk. In settlement of this swap, the Company received approximately $0.6 million. The remaining amount in accumulated other comprehensive income (“AOCI”) related to the hedging relationship will be reclassified into earnings when the hedged forecasted transaction is reported in earnings.

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 to whom amounts due totaled 24.1% and 26.1% of the Company’s accounts payable at June 29, 2022 and December 29, 2021, respectively. Purchases from the Company’s largest supplier totaled 27.4% and 28.5% of total expenses for the thirteen and twenty-six weeks ended June 29, 2022 and 26.2% and 26.6% of total expenses for the thirteen and twenty-six weeks ended June 30, 2021.

Company -operated and franchised restaurants in the greater Los Angeles area generated, in the aggregate, approximately 70.9% of total revenue for both the thirteen and twenty-six weeks ended June 29, 2022 and 70.6% and 70.4% for the thirteen and twenty-six weeks ended June 30, 2021, respectively.

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 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.

The Company determined that there were no indicators of potential impairment of its goodwill and indefinite-lived intangible assets during the thirteen and twenty-six weeks ended June 29, 2022. 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 29, 2022.

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 the Company’s interest rate swap.

The following table presents fair value for the interest rate swap at June 29, 2022 (in thousands):


			Fair Value Measurements Using
	Fair Value		Level 1		Level 2		Level 3
Other assets - Interest rate swap	$	706	$	—	$	706	$	—

The following table presents fair value for the interest rate swap at December 29, 2021 (in thousands):


			Fair Value Measurements Using
	Fair Value		Level 1		Level 2		Level 3
Other non-current liabilities - Interest rate swap	$	396	$	—	$	396	$	—

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 29, 2022, reflecting certain property and equipment assets and right-of-use (“ROU”) assets for which an impairment loss was recognized during the corresponding periods, as discussed under Note 2,

“Property and Equipment” and immediately below under “Impairment of Long-Lived Assets and ROU Assets” (in thousands):


									Thirteen Weeks		Twenty-Six Weeks
			Fair Value Measurements at June 29, 2022 Using						Ended June 29, 2022		Ended June 29, 2022
	Total		Level 1		Level 2		Level 3		Impairment Losses		Impairment Losses
Certain property and equipment, net	$	—	$	—	$	—	$	—	$	164	$	253

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 30, 2021, reflecting certain property and equipment assets and ROU assets for which an impairment loss was recognized during the corresponding periods, as discussed immediately below under “Impairment of Long-Lived Assets and ROU Assets” (in thousands):


									Thirteen Weeks		Twenty-Six Weeks
			Fair Value Measurements at June 30, 2021 Using						Ended June 30, 2021		Ended June 30, 2021
	Total		Level 1		Level 2		Level 3		Impairment Losses		Impairment Losses
Certain property and equipment, net	$	—	$	—	$	—	$	—	$	18	$	259
Certain property and equipment, held for sale		3,772		—		—		3,772		1,524		1,524
Certain ROU assets, net	$	1,898	$	—	$	—	$	1,898	$	344	$	407

Impairment of Long-Lived Assets and ROU Assets

The Company reviews its long-lived and 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 average unit volume for the last twelve months is 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 lease payments under the head lease. 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 for certain restaurants during the thirteen and twenty-six weeks ended June 29, 2022 that required an impairment review of certain of the Company’s long-lived and ROU assets. Based on the results of the analysis, the Company recorded non-cash impairment charges of $0.2 million and $0.3 million for the thirteen and twenty-six weeks ended June 29, 2022, respectively, primarily related to the long-lived assets of one restaurant in California.

The Company recorded a non-cash impairment charge of $0.4 million and $0.7 million for the thirteen and twenty-six weeks ended June 30, 2021, respectively, primarily related to the carrying value of the ROU assets of one restaurant in Texas closed in 2019, the carrying value of the ROU assets of one restaurant in California and the long-lived assets of three restaurants 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 29, 2022, the Company recognized less than $0.1 million and $0.1 million, respectively, of closed-store reserve expense related to the amortization of ROU assets, property taxes and CAM payments for its closed locations. During the thirteen and twenty-six weeks ended June 30, 2021, the Company recognized $0.1 million and $0.3 million of closed-store reserve expense, 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 sheets 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 its 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 29, 2022, 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 a reserve for 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 condensed 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 29, 2022 or at December 29, 2021. The Company did not recognize interest or penalties during the thirteen and twenty-six weeks ended June 29, 2022 and June 30, 2021, respectively, since there were no material unrecognized tax benefits. Management believes no significant 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-initial public offering (“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 (“NOLs”) and other tax attributes attributable to preceding periods. For the thirteen and twenty-six weeks ended June 29, 2022, the Company recorded income tax receivable agreement income of $0.2 million and $0.3 million, respectively, and for the thirteen and twenty-six weeks ended June 30, 2021, the Company recorded income tax receivable agreement expense of less than $0.1 million and income tax receivable agreement income of less than $0.1 million, respectively, in each case, related to the amortization of interest expense related to the total expected TRA payments and changes in estimates for actual tax returns filed and future forecasted taxable income.

The Coronavirus Aid, Relief and Economic Security Act provides for the deferral of employer Social Security taxes that are otherwise owed for wage payment and the creation of refundable employee retention credits. The total amount deferred as of December 30, 2020 was $4.9 million, of which 50% was paid at the end of 2021 and the remaining 50% is due by December 31, 2022.

Property and Equipment

6 Months Ended

Jun. 29, 2022

Property, Plant and Equipment [Abstract]

Property and Equipment

2. PROPERTY AND EQUIPMENT

The costs and related accumulated depreciation and amortization of major classes of property and equipment are as follows (in thousands):


	June 29, 2022		December 29, 2021
Land	$	12,323	$	12,323
Buildings and improvements		147,169		144,631
Other property and equipment		79,719		78,383
Construction in progress		7,156		5,333
		246,367		240,670
Less: accumulated depreciation and amortization		(170,294)		(165,002)
	$	76,073	$	75,668

Depreciation expense was $3.6 million and $3.9 million for the thirteen weeks ended June 29, 2022 and June 30, 2021, respectively, and $7.2 million and $7.9 million for the twenty-six weeks ended June 29, 2022 and June 30, 2021, respectively.

Based on the Company’s review of its long-lived assets for impairment, the Company recorded non-cash impairment charges of $0.2 million and $0.3 million for the thirteen and twenty-six weeks ended June 29, 2022, respectively, primarily related to the carrying value of the long-lived assets of one restaurant in California.

During the thirteen and twenty-six weeks ended June 30, 2021, the Company recorded non-cash impairment charges of less than $0.1 million and $0.3 million, respectively, primarily related to the carrying value of the assets of three restaurants in California. See Note 1, “Basis of Presentation and Summary of Significant Accounting Policies – Impairment of Long-Lived Assets and ROU Assets” for additional information.

Stock-Based Compensation

6 Months Ended

Jun. 29, 2022

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-Based Compensation

3. STOCK-BASED COMPENSATION

At June 29, 2022, options to purchase 1,183,873 shares of common stock were outstanding, including 628,053 vested and 555,820 unvested. Unvested options vest over time; however, upon a change in control, the Board of Directors may accelerate vesting. At June 29, 2022, 203,569 premium options, which are options granted above the stock price at date

of grant, remained outstanding. A summary of stock option activity as of June 29, 2022 and changes during the twenty-six weeks ended June 29, 2022 is as follows:


				Weighted-Average		Aggregate
		Weighted-Average		Contractual Life		Intrinsic Value
	Shares	Exercise Price		Life (Years)		(in thousands)
Outstanding - December 29, 2021	978,078	$	11.45
Grants	372,958		10.54
Exercised	(150,475)		10.50
Forfeited, cancelled or expired	(16,688)	$	15.67
Outstanding - June 29, 2022	1,183,873	$	11.22		6.28	$	873
Vested and expected to vest at June 29, 2022	1,172,691	$	11.22		6.24	$	873
Exercisable at June 29, 2022	628,053	$	10.48		3.65	$	873

The fair value of each stock option was estimated on the grant date using an exercise price of the closing stock price on the day prior to date of grant and the Black-Scholes option-pricing model with the following weighted average assumptions:


	June 29, 2022		June 30, 2021
Expected volatility	43.0	%	46.9	%
Risk-free interest rate	2.9	%	1.1	%
Expected term (years)	6.25		6.25
Expected dividends	—		—

At June 29, 2022, the Company had total unrecognized compensation expense of $2.7 million related to unvested stock options, which it expects to recognize over a weighted-average period of 3.39 years.

A summary of restricted share activity as of June 29, 2022 and changes during the twenty-six weeks ended June 29, 2022 is as follows:


		Weighted-Average
	Shares	Fair Value
Unvested shares at December 29, 2021	495,780	$	13.92
Granted	298,638	$	10.54
Released	(153,103)	$	13.38
Forfeited, cancelled, or expired	(27,931)	$	14.01
Unvested shares at June 29, 2022	613,384	$	12.41

At June 29, 2022, the Company had unrecognized compensation expense of $6.6 million related to unvested restricted shares, which it expects to recognize over a weighted-average period of 2.83 years.

Total stock-based compensation expense was $1.0 million and $1.8 million for the thirteen and twenty-six weeks ended June 29, 2022, respectively, and $1.0 million and $1.9 million for the thirteen and twenty-six weeks ended June 30, 2021.

Long-Term Debt

6 Months Ended

Jun. 29, 2022

Debt Disclosure [Abstract]

Long-Term Debt

4. LONG-TERM DEBT

The Company, as a guarantor, is a party to a credit agreement (the “2018 Credit Agreement”) among EPL, as borrower, Intermediate, as a guarantor, 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 Holdings and Intermediate. The obligations of Holdings, 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 1.70% to 2.87% and 1.35% to 2.87% for the thirteen and twenty-six weeks ended June 29, 2022, respectively, and 1.35% to 1.36% and 1.35% to 1.65% for the thirteen and twenty-six weeks ended June 30, 2021.

The 2018 Credit Agreement contains certain financial covenants. The Company was in compliance with the financial covenants as of June 29, 2022.

At June 29, 2022, $10.0 million of letters of credit and $40.0 million in borrowings under the 2018 Revolver were outstanding. The Company had $100.0 million in borrowing availability under the 2018 Revolver at June 29, 2022.

On July 27, 2022, the 2018 Revolver was refinanced pursuant to a new 2022 Credit Agreement among EPL, as borrower, the Company and Intermediate, as guarantors, the lenders and other parties party thereto and Bank of America, N.A., as administrative agent, swingline lender and letters of credit issuer, which provides for a $150.0 million five-year senior secured revolving facility. In connection with the refinancing, the 2018 Credit Agreement was terminated. On July 29, 2022, the Company made a $20.0 million payment to the 2022 Revolver and the outstanding balance as of August 4, 2022 was $20.0 million. For more information regarding the 2022 Credit Agreement, see Note 1, “Subsequent Events ― 2022 Credit Agreement.”

Maturities

No amounts were paid on the 2018 Revolver during the thirteen and twenty-six weeks ended June 29, 2022. During the thirteen and twenty-six weeks ended June 30, 2021, the Company paid down $13.8 million and $22.8 million on the 2018 Revolver, respectively. On July 27, 2022, the Company refinanced and terminated the 2018 Revolver pursuant to the 2022 Credit Agreement.

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 was 1.5% for the twenty-six weeks ended June 29, 2022. 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 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.

Subsequent to the quartet-end, in connection with the Company’s entry into the 2022 Credit Agreement, it terminated the interest rate swap previously used to hedge interest rate risk. In settlement of this swap, the Company received approximately $0.6 million. The remaining amount in AOCI related to the hedging relationship will be reclassified into earnings when the hedged forecasted transaction is reported in earnings.

For the twenty-six weeks ended June 29, 2022, the swap was a highly effective cash flow hedge.

As of June 29, 2022, the estimated net losses included in AOCI related to the Company’s cash flow hedge that will be reclassified into earnings in the next 12 months is $0.1 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 sheets (in thousands):


	June 29, 2022				December 29, 2021
	Notional		Fair value		Notional		Fair value
Other assets - Interest rate swap	$	40,000	$	706		—		—
Other liabilities - Interest rate swap	$	—	$	—	$	40,000	$	396

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 29, 2022		June 30, 2021		June 29, 2022		June 30, 2021
Interest expense on hedged portion of debt	$	204	$	136	$	347		336
Interest expense on interest rate swap		55		119		172		234
Interest expense on debt and derivatives, net	$	259	$	255	$	519	$	570

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 29, 2022 and June 30, 2021 (in thousands):


	Thirteen Weeks Ended								Twenty-Six Weeks Ended
					Loss Reclassified from								Loss Reclassified from
	Net Gain (Loss) Recognized in OCI				AOCI into Interest expense				Net Gain Recognized in OCI				AOCI into Interest expense
	June 29, 2022		June 30, 2021		June 29, 2022		June 30, 2021		June 29, 2022			June 30, 2021	June 29, 2022			June 30, 2021
Interest rate swap	$	347	$	(2)	$	55	$	119	$	931	$	76	$	172	$	234

See Note 1, “Basis of Presentation and Summary of Significant Accounting Policies” for information about the fair value of the Company’s derivative asset.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Topic 470
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-Section 50
-Paragraph 1I
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-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (i)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

+ Details

Other Accrued Expenses and Current Liabilities

6 Months Ended

Jun. 29, 2022

Payables And Accruals [Abstract]

Other Accrued Expenses and Current Liabilities

5. OTHER ACCRUED EXPENSES AND CURRENT LIABILITIES

Other accrued expenses and current liabilities consist of the following (in thousands):


	June 29, 2022		December 29, 2021
Accrued sales and property taxes	$	3,766	$	4,726
Gift card liability		4,133		4,622
Loyalty rewards program liability		564		687
Accrued advertising		3,233		3,635
Accrued legal settlements and professional fees		660		771
Deferred franchise and development fees		651		637
Employer social security tax deferral		2,543		—
Other		3,470		4,718
Total other accrued expenses and current liabilities	$	19,020	$	19,796

Other Noncurrent Liabilities

6 Months Ended

Jun. 29, 2022

Payables And Accruals [Abstract]

Other Noncurrent Liabilities

6. OTHER NONCURRENT LIABILITIES

Other noncurrent liabilities consist of the following (in thousands):


	June 29, 2022		December 29, 2021
Deferred franchise and development fees	$	5,789	$	5,691
Derivative liability		—		396
Employer social security tax deferral		—		2,426
Other		109		140
Total other noncurrent liabilities	$	5,898	$	8,653

Commitments and Contingencies

6 Months Ended

Jun. 29, 2022

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

7. COMMITMENTS AND CONTINGENCIES

Legal Matters

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 Holdings shareholder voluntarily dismissed the action on October 7, 2020. 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 September 25, 2020, after concluding its investigation, the SLC filed a motion to dismiss the Diep action and filed its investigative report under seal as an exhibit to the motion to dismiss.

On May 21, 2021, while the SLC’s motion to dismiss the Diep action was pending, the Company filed a notice of proposed partial settlement of the Diep action with respect to defendants Kay Bogeajis, Laurance Roberts, Stephen J. Sather, Edward J. Valle, Douglas K. Ammerman, and Samuel N. Borgese (collectively, the “Settling Defendants”). Defendant Trimaran Pollo Partners, LLC (“Trimaran”) was not a party to the settlement. The court approved the settlement of $625,000, less Plaintiffs’ fees of $156,250, on September 10, 2021, and dismissed all claims brought, or

that could have been brought, against Settling Defendants. In connection with this settlement, the Company received $469,000 in insurance proceeds, which was recorded within general and administrative expenses in the Company’s statement of income for the year ended December 29, 2021.

On July 30, 2021, the court granted the SLC’s motion to dismiss with respect to the claims asserted against remaining defendant Trimaran. On October 4, 2021, Plaintiffs filed a notice of appeal of the court’s granting of the motion to dismiss against defendant Trimaran. Plaintiff filed its opening brief on December 6, 2021. SLC filed its answering brief on December 20, 2021 and the public version of the brief was filed on January 7, 2022. Plaintiffs filed the reply brief on January 4, 2022. The hearing on the appeal took place on March 30, 2022. On June 28, 2022, the court’s granting of the motion to dismiss against Trimaran was affirmed.

The Company is also involved in various other claims such as wage and hour and other legal actions that arise in the ordinary course of business. The outcomes of these actions are not predictable but 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, condensed 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 29, 2022, the Company’s total estimated commitment to purchase chicken was $26.0 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 29, 2022, the potential amount of undiscounted payments the Company could be required to make in the event of non-payment by the primary lessee was $2.5 million. The present value of these potential payments discounted at the Company’s estimated pre-tax cost of debt at June 29, 2022 was $2.1 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.

Employment Agreements

As of June 29, 2022, the Company had 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.

Earnings Per Share

6 Months Ended

Jun. 29, 2022

Earnings Per Share [Abstract]

Earnings Per Share

8. EARNINGS PER SHARE

Basic earnings per share (“EPS”) is calculated using the weighted-average number of shares of common stock outstanding during the thirteen and twenty-six weeks ended June 29, 2022 and June 30, 2021. Diluted EPS is calculated using the weighted-average number of shares of common stock outstanding and potentially dilutive during the period, using the treasury stock method.

Below are basic and diluted EPS data for the periods indicated (in thousands except for share and per share data):



	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 29, 2022		June 30, 2021		June 29, 2022		June 30, 2021
Numerator:
Net income	$	7,141	$	8,818	$	9,256	$	12,782
Denominator:
Weighted-average shares outstanding—basic		36,331,099		35,927,781		36,278,423		35,861,493
Weighted-average shares outstanding—diluted		36,473,960		36,416,686		36,478,808		36,423,394
Net income per share—basic	$	0.20	$	0.25	$	0.26	$	0.36
Net income per share—diluted	$	0.20	$	0.24	$	0.25	$	0.35
Anti-dilutive securities not considered in diluted EPS calculation		952,517		138,117		597,201		65,798

Below is a reconciliation of basic and diluted share counts:



	Thirteen Weeks Ended		Twenty-Six Weeks Ended
	June 29, 2022	June 30, 2021	June 29, 2022	June 30, 2021
Weighted-average shares outstanding—basic	36,331,099	35,927,781	36,278,423	35,861,493
Dilutive effect of stock options and restricted shares	142,861	488,905	200,385	561,901
Weighted-average shares outstanding—diluted	36,473,960	36,416,686	36,478,808	36,423,394

Related Party Transactions

6 Months Ended

Jun. 29, 2022

Related Party Transactions

9. RELATED PARTY TRANSACTIONS

Trimaran Pollo Partners, L.L.C. (“LLC”) owns approximately 45.3% of the Company’s outstanding common stock as of June 29, 2022. This large position means that LLC and its majority owners—predecessors and affiliates of, and certain funds managed by, Trimaran Capital Partners and Freeman Spogli & Co. (collectively, “Trimaran” and “Freeman Spogli,” respectively)—possess significant influence when stockholders vote on matters such as election of directors, mergers, consolidations and acquisitions, the sale of all or substantially all of the Company’s assets, decisions affecting the Company’s capital structure, amendments to the Company’s amended and restated certificate of incorporation or amended and restated by-laws, and the Company’s winding up and dissolution. The Company’s amended and restated certificate of incorporation provides that (i) so long as LLC beneficially owns, directly or indirectly, more than 40% of the Company’s common stock, any member of the Board of Directors or the entire Board of Directors may be removed from office at any time with or without cause by the affirmative vote of a majority of the Company’s common stock, and (ii) prior to the date the LLC ceases to beneficially own, directly or indirectly, 40% or more of the Company’s common stock, stockholders representing at least 40% of the Company’s common stock may call a special meeting of the Company’s stockholders.

Revenue from Contracts with Customers

6 Months Ended

Jun. 29, 2022

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. Customers earn points for each dollar spent and 50 points can be redeemed for a $5 reward to be used for a future purchase. 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 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 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 points terms. As of June 29, 2022 and December 29, 2021, the revenue allocated to loyalty points that have not been redeemed was $0.6 million and $0.7 million, respectively, 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 29, 2022, there were no performance obligations related to hardware services that were unsatisfied or partially satisfied.

Disaggregated revenue

The following table presents the Company’s revenues disaggregated by revenue source and market (in thousands):


	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 29,		June 30,			June 29,		June 30,
	2022		2021			2022		2021
Core Market⁽¹⁾:
Company-operated restaurant revenue	$	101,440	$	99,429	$	191,066	$	186,652
Franchise revenue		4,708		4,086		9,058		7,773
Franchise advertising fee revenue		3,474		3,084		6,671		5,861
Total core market	$	109,622	$	106,599	$	206,795	$	200,286
Non-Core Market⁽²⁾:
Company-operated restaurant revenue	$	5,015	$	7,541	$	9,345	$	14,478
Franchise revenue		5,357		4,304		10,262		8,229
Franchise advertising fee revenue		4,117		3,541		7,757		6,713
Total non-core market	$	14,489	$	15,386	$	27,364	$	29,420
Total revenue	$	124,111	$	121,985	$	234,159	$	229,706

(1)	Core Market includes markets with existing company-operated restaurants at the time of the Company’s 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 the Company’s revenues disaggregated by geographic market:


	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 29, 2022		June 30, 2021		June 29, 2022		June 30, 2021
Greater Los Angeles area market	70.9	%	70.6	%	70.9	%	70.4	%
Other markets	29.1	%	29.4	%	29.1	%	29.6	%
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 29, 2022 and June 30, 2021 (in thousands):


December 29, 2021	$	6,328
Revenue recognized - beginning balance		(383)
Additional contract liability		495
June 29, 2022	$	6,440

December 30, 2020	$	5,628
Revenue recognized - beginning balance		(349)
Additional contract liability		384
June 30, 2021	$	5,663

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 29, 2022 (in thousands):


Franchise revenues:
2022	$	328
2023		601
2024		508
2025		464
2026		441
Thereafter		4,098
Total	$	6,440

Changes in the loyalty rewards program liability included in deferred revenue within other accrued expenses and current liabilities on the condensed consolidated balance sheets were as follows (in thousands):


	June 29,		December 29,
	2022		2021
Loyalty rewards liability, beginning balance	$	687	$	900
Revenue deferred		1,333		2,677
Revenue recognized		(1,456)		(2,890)
Loyalty rewards liability, ending balance	$	564	$	687

The Company expects all loyalty points revenue related to performance obligations unsatisfied as of June 29, 2022 to be recognized within one year.

Gift Cards

The gift card liability included in other accrued expenses and current liabilities on the condensed consolidated balance sheets was as follows (in thousands):


	June 29,		December 29,
	2022		2021
Gift card liability	$	4,133	$	4,622

Revenue recognized from the redemption of gift cards that was included in other accrued expenses and current liabilities at the beginning of the year was as follows (in thousands):


	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 29, 2022		June 30, 2021		June 29, 2022		June 30, 2021

Revenue recognized from gift card liability balance at the beginning of the year	$	313	$	286	$	732	$	689

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 https://asc.fasb.org/topic&trid=49130388

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-Publisher FASB
-Name Accounting Standards Codification
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-URI https://asc.fasb.org/extlink&oid=126920106&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 https://asc.fasb.org/extlink&oid=126920106&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 https://asc.fasb.org/extlink&oid=126920106&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 https://asc.fasb.org/extlink&oid=126920106&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 https://asc.fasb.org/extlink&oid=126920106&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 https://asc.fasb.org/extlink&oid=126920106&loc=SL49130554-203045

+ Details

Leases

6 Months Ended

Jun. 29, 2022

Leases [Abstract]

Leases

11. LEASES

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 29, 2022, the Company had three 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 and ten equipment leases that are classified as finance leases.

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 that 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 CAM, 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 29, 2022, the Company reassessed the lease terms on nine and thirteen restaurants, respectively, due to certain triggering events, such as the addition of significant leasehold improvements with useful lives that extend past the current lease expiration, the decision to terminate a lease, or the decision to renew. As a result of the reassessment, an additional $6.0 million and $8.5 million of ROU asset and lease liabilities for the thirteen and twenty-six weeks ended June 29, 2022, respectively, were recognized and will be amortized over the new lease term. During the thirteen and twenty-six weeks ended June 30, 2021, the Company reassessed the lease terms on five and twelve restaurants, respectively, due to certain triggering events, such as the addition of significant leasehold improvements with useful lives that extend past the current lease expiration, the decision to terminate a lease, or the decision to renew. This reassessment resulted in an additional $6.5 million and $11.2 million of ROU asset and lease liabilities for the thirteen and twenty-six weeks ended June 30, 2021, respectively, which were recognized and will be amortized over the new lease term. The reassessments had an impact on the original lease classification of one property during the thirteen weeks ended June 29, 2022 which represented $0.7 million of the $6.0 million total additional ROU asset and lease liabilities for the period. 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 29, 2022, the Company did not record any non-cash impairment charges. The Company recorded a $0.4 million non-cash impairment charge for the twenty-six weeks ended June 30, 2021 related to one restaurant closed in Texas in 2019 and one restaurant in California. See Note 1, “Basis of Presentation and Summary of Significant Accounting Policies – Impairment of Long-Lived Assets and ROU Assets” for additional information.

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 29, 2022						June 30, 2021
	Property		Equipment				Property		Equipment
	Leases		Leases		Total		Leases		Leases		Total
Finance lease cost:
Amortization of right-of-use assets	$	18	$	1	$	19	$	22	$	1	$	23
Interest on lease liabilities		10		1		11		15		1		16
Operating lease cost		6,585		258		6,843		6,626		293		6,919
Short-term lease cost		—		4		4		—		5		5
Variable lease cost		171		149		320		153		83		236
Sublease income		(1,129)		—		(1,129)		(798)		—		(798)
Total lease cost	$	5,655	$	413	$	6,068	$	6,018	$	383	$	6,401


	Twenty-Six Weeks Ended
	June 29, 2022						June 30, 2021
	Property		Equipment				Property		Equipment
	Leases		Leases		Total		Leases		Leases		Total
Finance lease cost:
Amortization of right-of-use assets	$	37	$	1	$	38	$	42	$	1	$	43
Interest on lease liabilities		22		2		24		30		1		31
Operating lease cost		13,149		521		13,670		13,383		594		13,977
Short-term lease cost		—		8		8		—		10		10
Variable lease cost		307		267		574		275		190		465
Sublease income		(2,257)		—		(2,257)		(1,594)		—		(1,594)
Total lease cost	$	11,258	$	799	$	12,057	$	12,136	$	796	$	12,932

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 29, 2022		June 30, 2021		June 29, 2022		June 30, 2021
Lease cost – Occupancy and other operating expenses	$	5,912	$	6,149	$	11,742	$	12,380
Lease cost – General & administrative		105		103		210		219
Lease cost – Depreciation and amortization		18		22		37		42
Lease cost – Interest expense		11		15		24		30
Lease cost – Closed-store reserve		22		112		44		261
Total lease cost	$	6,068	$	6,401	$	12,057	$	12,932

During the thirteen and twenty-six weeks ended June 29, 2022 and June 30, 2021, the Company had the following cash and non-cash activities associated with its leases (dollars in thousands):


	Twenty-Six Weeks Ended June 29, 2022								Twenty-Six Weeks Ended June 30, 2021
	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	$	13,543		$	495		$	14,038	$	12,357		$	575		$	12,932
Financing cash flows used for finance leases	$	58		$	28		$	86	$	33		$	20		$	53

Non-cash investing and financing activities:
Operating lease ROU assets obtained in exchange for lease liabilities:
Operating lease ROU assets	$	8,485		$	—		$	8,485	$	11,260		$	—		$	11,260
Finance lease ROU assets obtained in exchange for lease liabilities:
Finance lease ROU assets	$	—		$	28		$	28	$	—		$	196		$	196
Derecognition of ROU assets due to terminations, impairment or modifications	$	—		$	(24)		$	(24)	$	(4,513)		$	(39)		$	(4,552)

Other Information
Weighted-average remaining years in lease term—finance leases		18.37			3.68					17.61			4.44
Weighted-average remaining years in lease term—operating leases		11.01			1.19					11.51			1.87
Weighted-average discount rate—finance leases		2.57	%		1.53	%				2.75	%		1.57	%
Weighted-average discount rate—operating leases		4.47	%		3.82	%				4.42	%		3.92	%

Information regarding the Company’s minimum future lease obligations as of June 29, 2022 is as follows (in thousands):


	Finance		Operating Leases
	Minimum		Minimum		Minimum
	Lease		Lease		Sublease
For the Years Ending	Payments		Payments		Income
December 28, 2022	$	76	$	14,130	$	1,869
December 27, 2023		151		27,654		3,698
December 25, 2024		151		25,313		3,510
December 31, 2025		147		23,073		3,115
December 30, 2026		114		20,846		2,789
Thereafter		1,583		133,169		23,165
Total	$	2,222	$	244,185	$	38,146
Less: imputed interest (1.53% - 4.47%)		(432)		(53,677)
Present value of lease obligations		1,790		190,508
Less: current maturities		(109)		(20,154)
Noncurrent portion	$	1,681	$	170,354

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 condensed consolidated statements of income on a straight-line basis over the lease term and variable lease payments in the period in which the obligation for those payments was 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 of lease income from company-owned locations for each of the thirteen weeks ended June 29, 2022 and June 30, 2021. The Company received $0.2 million of lease income from company-owned locations for each of the twenty-six weeks ended June 29, 2022 and June 30, 2021.

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

6 Months Ended

Jun. 29, 2022

Accounting Policies [Abstract]

Basis of Presentation

Principles of Consolidation

Use of Estimates

Covid 19

COVID-19

Cash and Cash Equivalents

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

Liquidity

Recently Adopted Accounting Pronouncements

None.

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.

exceeds the reporting unit’s fair value; however, the loss recognized cannot exceed the total amount of goodwill allocated to that reporting unit.

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.

The following table presents fair value for the interest rate swap at June 29, 2022 (in thousands):


			Fair Value Measurements Using
	Fair Value		Level 1		Level 2		Level 3
Other assets - Interest rate swap	$	706	$	—	$	706	$	—

The following table presents fair value for the interest rate swap at December 29, 2021 (in thousands):


			Fair Value Measurements Using
	Fair Value		Level 1		Level 2		Level 3
Other non-current liabilities - Interest rate swap	$	396	$	—	$	396	$	—

“Property and Equipment” and immediately below under “Impairment of Long-Lived Assets and ROU Assets” (in thousands):


									Thirteen Weeks		Twenty-Six Weeks
			Fair Value Measurements at June 29, 2022 Using						Ended June 29, 2022		Ended June 29, 2022
	Total		Level 1		Level 2		Level 3		Impairment Losses		Impairment Losses
Certain property and equipment, net	$	—	$	—	$	—	$	—	$	164	$	253


									Thirteen Weeks		Twenty-Six Weeks
			Fair Value Measurements at June 30, 2021 Using						Ended June 30, 2021		Ended June 30, 2021
	Total		Level 1		Level 2		Level 3		Impairment Losses		Impairment Losses
Certain property and equipment, net	$	—	$	—	$	—	$	—	$	18	$	259
Certain property and equipment, held for sale		3,772		—		—		3,772		1,524		1,524
Certain ROU assets, net	$	1,898	$	—	$	—	$	1,898	$	344	$	407

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.

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

6 Months Ended

Jun. 29, 2022

Accounting Policies [Abstract]

Schedule of fair value measurement

The following table presents fair value for the interest rate swap at June 29, 2022 (in thousands):


			Fair Value Measurements Using
	Fair Value		Level 1		Level 2		Level 3
Other assets - Interest rate swap	$	706	$	—	$	706	$	—

The following table presents fair value for the interest rate swap at December 29, 2021 (in thousands):


			Fair Value Measurements Using
	Fair Value		Level 1		Level 2		Level 3
Other non-current liabilities - Interest rate swap	$	396	$	—	$	396	$	—

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

“Property and Equipment” and immediately below under “Impairment of Long-Lived Assets and ROU Assets” (in thousands):


									Thirteen Weeks		Twenty-Six Weeks
			Fair Value Measurements at June 29, 2022 Using						Ended June 29, 2022		Ended June 29, 2022
	Total		Level 1		Level 2		Level 3		Impairment Losses		Impairment Losses
Certain property and equipment, net	$	—	$	—	$	—	$	—	$	164	$	253


									Thirteen Weeks		Twenty-Six Weeks
			Fair Value Measurements at June 30, 2021 Using						Ended June 30, 2021		Ended June 30, 2021
	Total		Level 1		Level 2		Level 3		Impairment Losses		Impairment Losses
Certain property and equipment, net	$	—	$	—	$	—	$	—	$	18	$	259
Certain property and equipment, held for sale		3,772		—		—		3,772		1,524		1,524
Certain ROU assets, net	$	1,898	$	—	$	—	$	1,898	$	344	$	407

Property and Equipment (Tables)

6 Months Ended

Jun. 29, 2022

Property, Plant and Equipment [Abstract]

Schedule of Costs and Related Accumulated Depreciation and Amortization of Major Classes of Property and Equipment

The costs and related accumulated depreciation and amortization of major classes of property and equipment are as follows (in thousands):


	June 29, 2022		December 29, 2021
Land	$	12,323	$	12,323
Buildings and improvements		147,169		144,631
Other property and equipment		79,719		78,383
Construction in progress		7,156		5,333
		246,367		240,670
Less: accumulated depreciation and amortization		(170,294)		(165,002)
	$	76,073	$	75,668

Stock-Based Compensation (Tables)

6 Months Ended

Jun. 29, 2022

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Changes in Stock Options


				Weighted-Average		Aggregate
		Weighted-Average		Contractual Life		Intrinsic Value
	Shares	Exercise Price		Life (Years)		(in thousands)
Outstanding - December 29, 2021	978,078	$	11.45
Grants	372,958		10.54
Exercised	(150,475)		10.50
Forfeited, cancelled or expired	(16,688)	$	15.67
Outstanding - June 29, 2022	1,183,873	$	11.22		6.28	$	873
Vested and expected to vest at June 29, 2022	1,172,691	$	11.22		6.24	$	873
Exercisable at June 29, 2022	628,053	$	10.48		3.65	$	873

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions


	June 29, 2022		June 30, 2021
Expected volatility	43.0	%	46.9	%
Risk-free interest rate	2.9	%	1.1	%
Expected term (years)	6.25		6.25
Expected dividends	—		—

Schedule of Changes in Restricted Shares


		Weighted-Average
	Shares	Fair Value
Unvested shares at December 29, 2021	495,780	$	13.92
Granted	298,638	$	10.54
Released	(153,103)	$	13.38
Forfeited, cancelled, or expired	(27,931)	$	14.01
Unvested shares at June 29, 2022	613,384	$	12.41

Long-Term Debt (Tables)

6 Months Ended

Jun. 29, 2022

Debt Disclosure [Abstract]

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value

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


	June 29, 2022				December 29, 2021
	Notional		Fair value		Notional		Fair value
Other assets - Interest rate swap	$	40,000	$	706		—		—
Other liabilities - Interest rate swap	$	—	$	—	$	40,000	$	396

Schedule of Derivatives Instruments Statements of Financial Performance and Financial Position, Location

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 29, 2022		June 30, 2021		June 29, 2022		June 30, 2021
Interest expense on hedged portion of debt	$	204	$	136	$	347		336
Interest expense on interest rate swap		55		119		172		234
Interest expense on debt and derivatives, net	$	259	$	255	$	519	$	570

Schedule of Derivative Instruments, Effect on Other Comprehensive Income (Loss)

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 29, 2022 and June 30, 2021 (in thousands):


	Thirteen Weeks Ended								Twenty-Six Weeks Ended
					Loss Reclassified from								Loss Reclassified from
	Net Gain (Loss) Recognized in OCI				AOCI into Interest expense				Net Gain Recognized in OCI				AOCI into Interest expense
	June 29, 2022		June 30, 2021		June 29, 2022		June 30, 2021		June 29, 2022			June 30, 2021	June 29, 2022			June 30, 2021
Interest rate swap	$	347	$	(2)	$	55	$	119	$	931	$	76	$	172	$	234

Other Accrued Expenses and Current Liabilities (Tables)

6 Months Ended

Jun. 29, 2022

Payables And Accruals [Abstract]

Schedule of Other Accrued Expenses and Current Liabilities

Other accrued expenses and current liabilities consist of the following (in thousands):


	June 29, 2022		December 29, 2021
Accrued sales and property taxes	$	3,766	$	4,726
Gift card liability		4,133		4,622
Loyalty rewards program liability		564		687
Accrued advertising		3,233		3,635
Accrued legal settlements and professional fees		660		771
Deferred franchise and development fees		651		637
Employer social security tax deferral		2,543		—
Other		3,470		4,718
Total other accrued expenses and current liabilities	$	19,020	$	19,796

Other Noncurrent Liabilities (Tables)

6 Months Ended

Jun. 29, 2022

Payables And Accruals [Abstract]

Schedule of Other Noncurrent Liabilities

Other noncurrent liabilities consist of the following (in thousands):


	June 29, 2022		December 29, 2021
Deferred franchise and development fees	$	5,789	$	5,691
Derivative liability		—		396
Employer social security tax deferral		—		2,426
Other		109		140
Total other noncurrent liabilities	$	5,898	$	8,653

Earnings Per Share (Tables)

6 Months Ended

Jun. 29, 2022

Earnings Per Share [Abstract]

Computation of Basic and Diluted Net Income per Share

Below are basic and diluted EPS data for the periods indicated (in thousands except for share and per share data):



	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 29, 2022		June 30, 2021		June 29, 2022		June 30, 2021
Numerator:
Net income	$	7,141	$	8,818	$	9,256	$	12,782
Denominator:
Weighted-average shares outstanding—basic		36,331,099		35,927,781		36,278,423		35,861,493
Weighted-average shares outstanding—diluted		36,473,960		36,416,686		36,478,808		36,423,394
Net income per share—basic	$	0.20	$	0.25	$	0.26	$	0.36
Net income per share—diluted	$	0.20	$	0.24	$	0.25	$	0.35
Anti-dilutive securities not considered in diluted EPS calculation		952,517		138,117		597,201		65,798

Schedule of Reconciliation of Basic and Diluted Share Counts

Below is a reconciliation of basic and diluted share counts:



	Thirteen Weeks Ended		Twenty-Six Weeks Ended
	June 29, 2022	June 30, 2021	June 29, 2022	June 30, 2021
Weighted-average shares outstanding—basic	36,331,099	35,927,781	36,278,423	35,861,493
Dilutive effect of stock options and restricted shares	142,861	488,905	200,385	561,901
Weighted-average shares outstanding—diluted	36,473,960	36,416,686	36,478,808	36,423,394

Revenue from Contracts with Customers (Tables)

6 Months Ended

Jun. 29, 2022

Disaggregation of Revenue [Line Items]

Disaggregation of Revenue

The following table presents the Company’s revenues disaggregated by revenue source and market (in thousands):


	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 29,		June 30,			June 29,		June 30,
	2022		2021			2022		2021
Core Market⁽¹⁾:
Company-operated restaurant revenue	$	101,440	$	99,429	$	191,066	$	186,652
Franchise revenue		4,708		4,086		9,058		7,773
Franchise advertising fee revenue		3,474		3,084		6,671		5,861
Total core market	$	109,622	$	106,599	$	206,795	$	200,286
Non-Core Market⁽²⁾:
Company-operated restaurant revenue	$	5,015	$	7,541	$	9,345	$	14,478
Franchise revenue		5,357		4,304		10,262		8,229
Franchise advertising fee revenue		4,117		3,541		7,757		6,713
Total non-core market	$	14,489	$	15,386	$	27,364	$	29,420
Total revenue	$	124,111	$	121,985	$	234,159	$	229,706

(1)	Core Market includes markets with existing company-operated restaurants at the time of the Company’s 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 the Company’s revenues disaggregated by geographic market:


	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 29, 2022		June 30, 2021		June 29, 2022		June 30, 2021
Greater Los Angeles area market	70.9	%	70.6	%	70.9	%	70.4	%
Other markets	29.1	%	29.4	%	29.1	%	29.6	%
Total	100	%	100	%	100	%	100	%

Schedule of Estimated Revenue to be Recognized Related to Performance Obligations


Franchise revenues:
2022	$	328
2023		601
2024		508
2025		464
2026		441
Thereafter		4,098
Total	$	6,440

Loyalty reward program

Disaggregation of Revenue [Line Items]

Schedule of Change in Franchise Contract Liability Balances


	June 29,		December 29,
	2022		2021
Loyalty rewards liability, beginning balance	$	687	$	900
Revenue deferred		1,333		2,677
Revenue recognized		(1,456)		(2,890)
Loyalty rewards liability, ending balance	$	564	$	687

Gift card liability

Disaggregation of Revenue [Line Items]

Schedule of Change in Franchise Contract Liability Balances

The gift card liability included in other accrued expenses and current liabilities on the condensed consolidated balance sheets was as follows (in thousands):


	June 29,		December 29,
	2022		2021
Gift card liability	$	4,133	$	4,622

Revenue recognized from the redemption of gift cards that was included in other accrued expenses and current liabilities at the beginning of the year was as follows (in thousands):


	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 29, 2022		June 30, 2021		June 29, 2022		June 30, 2021

Revenue recognized from gift card liability balance at the beginning of the year	$	313	$	286	$	732	$	689

Franchise revenue

Disaggregation of Revenue [Line Items]

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 29, 2022 and June 30, 2021 (in thousands):


December 29, 2021	$	6,328
Revenue recognized - beginning balance		(383)
Additional contract liability		495
June 29, 2022	$	6,440

December 30, 2020	$	5,628
Revenue recognized - beginning balance		(349)
Additional contract liability		384
June 30, 2021	$	5,663

Leases (Tables)

6 Months Ended

Jun. 29, 2022

Leases [Abstract]

Schedule of lease cost

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


	Thirteen Weeks Ended
	June 29, 2022						June 30, 2021
	Property		Equipment				Property		Equipment
	Leases		Leases		Total		Leases		Leases		Total
Finance lease cost:
Amortization of right-of-use assets	$	18	$	1	$	19	$	22	$	1	$	23
Interest on lease liabilities		10		1		11		15		1		16
Operating lease cost		6,585		258		6,843		6,626		293		6,919
Short-term lease cost		—		4		4		—		5		5
Variable lease cost		171		149		320		153		83		236
Sublease income		(1,129)		—		(1,129)		(798)		—		(798)
Total lease cost	$	5,655	$	413	$	6,068	$	6,018	$	383	$	6,401


	Twenty-Six Weeks Ended
	June 29, 2022						June 30, 2021
	Property		Equipment				Property		Equipment
	Leases		Leases		Total		Leases		Leases		Total
Finance lease cost:
Amortization of right-of-use assets	$	37	$	1	$	38	$	42	$	1	$	43
Interest on lease liabilities		22		2		24		30		1		31
Operating lease cost		13,149		521		13,670		13,383		594		13,977
Short-term lease cost		—		8		8		—		10		10
Variable lease cost		307		267		574		275		190		465
Sublease income		(2,257)		—		(2,257)		(1,594)		—		(1,594)
Total lease cost	$	11,258	$	799	$	12,057	$	12,136	$	796	$	12,932

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 29, 2022		June 30, 2021		June 29, 2022		June 30, 2021
Lease cost – Occupancy and other operating expenses	$	5,912	$	6,149	$	11,742	$	12,380
Lease cost – General & administrative		105		103		210		219
Lease cost – Depreciation and amortization		18		22		37		42
Lease cost – Interest expense		11		15		24		30
Lease cost – Closed-store reserve		22		112		44		261
Total lease cost	$	6,068	$	6,401	$	12,057	$	12,932

During the thirteen and twenty-six weeks ended June 29, 2022 and June 30, 2021, the Company had the following cash and non-cash activities associated with its leases (dollars in thousands):


	Twenty-Six Weeks Ended June 29, 2022								Twenty-Six Weeks Ended June 30, 2021
	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	$	13,543		$	495		$	14,038	$	12,357		$	575		$	12,932
Financing cash flows used for finance leases	$	58		$	28		$	86	$	33		$	20		$	53

Non-cash investing and financing activities:
Operating lease ROU assets obtained in exchange for lease liabilities:
Operating lease ROU assets	$	8,485		$	—		$	8,485	$	11,260		$	—		$	11,260
Finance lease ROU assets obtained in exchange for lease liabilities:
Finance lease ROU assets	$	—		$	28		$	28	$	—		$	196		$	196
Derecognition of ROU assets due to terminations, impairment or modifications	$	—		$	(24)		$	(24)	$	(4,513)		$	(39)		$	(4,552)

Other Information
Weighted-average remaining years in lease term—finance leases		18.37			3.68					17.61			4.44
Weighted-average remaining years in lease term—operating leases		11.01			1.19					11.51			1.87
Weighted-average discount rate—finance leases		2.57	%		1.53	%				2.75	%		1.57	%
Weighted-average discount rate—operating leases		4.47	%		3.82	%				4.42	%		3.92	%

Schedule of Financing Leases

Information regarding the Company’s minimum future lease obligations as of June 29, 2022 is as follows (in thousands):


	Finance		Operating Leases
	Minimum		Minimum		Minimum
	Lease		Lease		Sublease
For the Years Ending	Payments		Payments		Income
December 28, 2022	$	76	$	14,130	$	1,869
December 27, 2023		151		27,654		3,698
December 25, 2024		151		25,313		3,510
December 31, 2025		147		23,073		3,115
December 30, 2026		114		20,846		2,789
Thereafter		1,583		133,169		23,165
Total	$	2,222	$	244,185	$	38,146
Less: imputed interest (1.53% - 4.47%)		(432)		(53,677)
Present value of lease obligations		1,790		190,508
Less: current maturities		(109)		(20,154)
Noncurrent portion	$	1,681	$	170,354

Schedule of Operating Leases

Information regarding the Company’s minimum future lease obligations as of June 29, 2022 is as follows (in thousands):


	Finance		Operating Leases
	Minimum		Minimum		Minimum
	Lease		Lease		Sublease
For the Years Ending	Payments		Payments		Income
December 28, 2022	$	76	$	14,130	$	1,869
December 27, 2023		151		27,654		3,698
December 25, 2024		151		25,313		3,510
December 31, 2025		147		23,073		3,115
December 30, 2026		114		20,846		2,789
Thereafter		1,583		133,169		23,165
Total	$	2,222	$	244,185	$	38,146
Less: imputed interest (1.53% - 4.47%)		(432)		(53,677)
Present value of lease obligations		1,790		190,508
Less: current maturities		(109)		(20,154)
Noncurrent portion	$	1,681	$	170,354

Basis Of Presentation And Summary of Significant Accounting Policies - Additional Information (Details) $ in Thousands					3 Months Ended		6 Months Ended		12 Months Ended
	Jul. 29, 2022 USD ($)	Jul. 27, 2022 USD ($)	Jul. 13, 2018 USD ($)	Jul. 30, 2014	Jun. 29, 2022 USD ($) restaurant	Jun. 30, 2021 USD ($) restaurant	Jun. 29, 2022 USD ($) segment item restaurant	Jun. 30, 2021 USD ($) restaurant	Dec. 29, 2021 USD ($)	Aug. 04, 2022 USD ($)	Dec. 30, 2020 USD ($)
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Number of operating segments \| segment							1
Leaves of absence and overtime pay due to COVID 19					$ 300	$ 200	$ 2,600	$ 3,000
Revolver loan					40,000		40,000		$ 40,000
Total amount of outstanding debt					40,000		40,000
Cash available					34,311		34,311		30,046
Proceeds from disposition of restaurants								4,556
Impairment losses						1,524		1,524
Impairment of property and equipment					200	400	253	666
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%
Income tax receivable agreement (income) expense					(186)	27	$ (316)	(50)
Total deferred amount											$ 4,900
Percentage of deferred amount due by current fiscal year											50.00%
Percentage of deferred amount due by next fiscal year											50.00%
Minimum
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Income tax receivable agreement (income) expense					$ (200)
Maximum
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Income tax receivable agreement (income) expense						$ 100		$ 100
Supplier Concentration Risk \| Supplier One \| Accounts Payable
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Number Of Suppliers \| item							1
Percentage of concentration							24.10%		26.10%
Supplier Concentration Risk \| Largest Supplier One \| Purchased
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Percentage of concentration					27.40%	26.20%	28.50%	26.60%
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
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Settlement of interest rate swap		$ 600
Revolving Credit Facility \| Subsequent Event
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Revolver loan										$ 20,000
Prepayment for long-term line of credit	$ 20,000
2018 Credit Agreement \| Revolving Credit Facility
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Senior secured revolving facility			$ 150,000
Senior secured revolving facility term			5 years
Debt Instrument, Maturity Date							Jul. 13, 2023
Revolver loan					$ 40,000		$ 40,000
2018 Credit Agreement \| Revolving Credit Facility \| Federal Funds Rate
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Debt instrument basis percentage							0.50%
2018 Credit Agreement \| Revolving Credit Facility \| Minimum \| Base Rate
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Debt instrument basis percentage							0.25%
2018 Credit Agreement \| Revolving Credit Facility \| Maximum \| Base Rate
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Debt instrument basis percentage							1.25%
2018 Credit Agreement \| Letter of Credit
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Sub limit of revolving facility			$ 15,000
2018 Credit Agreement \| Swing Line Loans
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Sub limit of revolving facility			$ 15,000
2022 Credit Agreement \| Revolving Credit Facility
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Debt Instrument, Maturity Date							Jul. 27, 2027
2022 Credit Agreement \| Revolving Credit Facility \| Subsequent Event
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Senior secured revolving facility		$ 150,000
Senior secured revolving facility term		5 years
2022 Credit Agreement \| Revolving Credit Facility \| Subsequent Event \| SOFR
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Debt instrument basis percentage		1.00%
2022 Credit Agreement \| Revolving Credit Facility \| Subsequent Event \| Federal Funds Rate
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Debt instrument basis percentage		0.50%
2022 Credit Agreement \| Revolving Credit Facility \| Subsequent Event \| Minimum \| SOFR
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Debt instrument basis percentage		1.25%
2022 Credit Agreement \| Revolving Credit Facility \| Subsequent Event \| Minimum \| Base Rate
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Debt instrument basis percentage		0.25%
2022 Credit Agreement \| Revolving Credit Facility \| Subsequent Event \| Maximum \| SOFR
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Debt instrument basis percentage		2.25%
2022 Credit Agreement \| Revolving Credit Facility \| Subsequent Event \| Maximum \| Base Rate
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Debt instrument basis percentage		1.25%
2022 Credit Agreement \| Letter of Credit \| Subsequent Event
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Sub limit of revolving facility		$ 15,000
2022 Credit Agreement \| Swing Line Loans \| Subsequent Event
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Sub limit of revolving facility		$ 15,000
Texas
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Number of restaurants with ROU asset impairment charges \| restaurant						1		1
California
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Number of restaurants \| restaurant					1	3	1	3
Number of restaurants with ROU asset impairment charges \| 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					70.90%	70.60%	70.90%	70.40%
Closed Store
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Closed-store reserve expense						$ 100	$ 100	$ 300
Closed Store \| Maximum
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Closed-store reserve expense					$ 100
Company-operated
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Number of restaurants \| restaurant					188		188
Franchised
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Number of restaurants \| restaurant					293		293

Basis Of Presentation And Summary of Significant Accounting Policies - Fair Value Measurements (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 29, 2022	Jun. 30, 2021	Jun. 29, 2022	Jun. 30, 2021	Dec. 29, 2021
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Property and equipment, net	$ 76,073		$ 76,073		$ 75,668
Impairment of property and equipment	164	$ 18	$ 253	$ 259
Impairment, Long-Lived Asset, Held-for-Use, Statement of Income or Comprehensive Income [Extensible Enumeration]			Restructuring Costs and Asset Impairment Charges
Loss on assets held for sale		1,524		1,524
Impairment of Right-of-Use Assets		344	$ 0	407
Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Liability, Fair Value, Gross Liability					396
Derivative Asset, Fair Value, Gross Asset	706		706
Fair Value, Measurements, Recurring [Member] \| Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Asset, Fair Value, Gross Asset	0		0
Fair Value, Measurements, Recurring [Member] \| Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Liability, Fair Value, Gross Liability					$ 396
Derivative Asset, Fair Value, Gross Asset	706		706
Fair Value, Measurements, Recurring [Member] \| Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Asset, Fair Value, Gross Asset	0		0
Fair Value, Measurements, Nonrecurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Property and equipment, net	0	0	0	0
Certain property and equipment, held for sale		3,772		3,772
Right-of-Use Assets, Net		1,898		1,898
Fair Value, Measurements, Nonrecurring \| Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Property and equipment, net	0	0	0	0
Certain property and equipment, held for sale		0		0
Right-of-Use Assets, Net		0		0
Fair Value, Measurements, Nonrecurring \| Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Property and equipment, net	0	0	0	0
Certain property and equipment, held for sale		0		0
Right-of-Use Assets, Net		0		0
Fair Value, Measurements, Nonrecurring \| Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Property and equipment, net	$ 0	0	$ 0	0
Certain property and equipment, held for sale		3,772		3,772
Right-of-Use Assets, Net		$ 1,898		$ 1,898

Property and Equipment - Schedule of Costs and Related Accumulated Depreciation and Amortization of Major Classes of Property (Details) - USD ($) $ in Thousands	Jun. 29, 2022	Dec. 29, 2021
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 246,367	$ 240,670
Less: accumulated depreciation and amortization	(170,294)	(165,002)
Property and equipment, net	76,073	75,668
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	147,169	144,631
Other property and equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	79,719	78,383
Construction in progress
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 7,156	$ 5,333

Property and Equipment - Additional Information (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 29, 2022 USD ($) restaurant	Jun. 30, 2021 USD ($) restaurant	Jun. 29, 2022 USD ($) restaurant	Jun. 30, 2021 USD ($) restaurant
Property, Plant and Equipment [Line Items]
Depreciation expense	$ 3,600	$ 3,900	$ 7,200	$ 7,900
Impairment of property and equipment	164	18	253	259
California
Property, Plant and Equipment [Line Items]
Impairment of property and equipment	$ 200	$ 100	$ 300	$ 300
Number of restaurants primarily responsible for impairment \| restaurant	1	3	1	3

Stock-Based Compensation - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 29, 2022	Jun. 30, 2021	Jun. 29, 2022	Jun. 30, 2021	Dec. 29, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock, options outstanding (shares)	1,183,873		1,183,873		978,078
Common stock, options vested (shares)			628,053
Common stock, options unvested (shares)	555,820		555,820
Options to purchase common stock granted (shares)			372,958
Aggregate intrinsic value of options outstanding	$ 873		$ 873
Expected volatility			43.00%	46.90%
Risk-free interest rate			2.90%	1.10%
Expected term (years)			6 years 3 months	6 years 3 months
Unrecognized compensation expense, recognition period			3 years 4 months 20 days
Granted (shares)			298,638
Stock-based compensation expense	1,000	$ 1,000	$ 1,796	$ 1,894
Unrecognized compensation expense	$ 2,700		$ 2,700
Premium Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock, options outstanding (shares)	203,569		203,569
Restricted Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense	$ 6,600		$ 6,600
Unrecognized compensation expense, recognition period			2 years 9 months 29 days

Stock-Based Compensation - Changes in Stock Options (Details) - USD ($) $ / shares in Units, $ in Thousands	6 Months Ended
	Jun. 29, 2022
Shares
Outstanding-beginning balance (shares)	978,078
Grants (shares)	372,958
Exercised (shares)	(150,475)
Forfeited, cancelled or expired (shares)	(16,688)
Outstanding-ending balance (shares)	1,183,873
Vested and expected to vest at end of period (shares)	1,172,691
Exercisable at end of period (shares)	628,053
Weighted-Average Exercise Price
Outstanding-beginning balance (usd per share)	$ 11.45
Grants (usd per share)	10.54
Exercised (usd per share)	10.50
Forfeited, cancelled or expired (usd per share)	15.67
Outstanding-ending balance (usd per share)	11.22
Vested and expected to vest at end of period (usd per share)	11.22
Exercisable at end of period (usd per share)	$ 10.48
Weighted-Average Contractual Life (Years)
Outstanding contractual life (years)	6 years 3 months 10 days
Vested and expected to vest contractual life (years)	6 years 2 months 26 days
Exercisable contractual life (years)	3 years 7 months 24 days
Aggregate Intrinsic Value
Outstanding	$ 873
Vested and expected to vest	873
Exercisable	$ 873

Stock-Based Compensation - Schedule of Changes in Restricted Shares (Details)	6 Months Ended
	Jun. 29, 2022 $ / shares shares
Shares
Unvested shares, beginning balance (shares) \| shares	495,780
Granted (shares) \| shares	298,638
Released (shares) \| shares	(153,103)
Forfeited, cancelled, or expired (shares) \| shares	(27,931)
Unvested shares, ending balance (shares) \| shares	613,384
Weighted-Average Fair Value
Unvested shares Weighted-Average Fair Value, beginning balance (usd per share) \| $ / shares	$ 13.92
Granted, Weighted-Average Fair Value (usd per share) \| $ / shares	10.54
Released, Weighted-Average Fair Value (usd per share) \| $ / shares	13.38
Forfeited, cancelled, or expired, Weighted-Average Fair Value (usd per share) \| $ / shares	14.01
Unvested shares Weighted-Average Fair Value, ending balance (usd per share) \| $ / shares	$ 12.41

Long-Term Debt - Additional Information (Details) $ in Thousands					3 Months Ended		6 Months Ended
	Jul. 29, 2022 USD ($)	Jul. 27, 2022 USD ($)	Jun. 30, 2022 USD ($)	Jul. 13, 2018 USD ($)	Jun. 29, 2022 USD ($)	Jun. 30, 2021 USD ($)	Jun. 29, 2022 USD ($)	Jun. 30, 2021 USD ($)	Aug. 04, 2022 USD ($)	Dec. 29, 2021 USD ($)	Dec. 25, 2019 USD ($)
Debt Instrument [Line Items]
Revolving line of credit					$ 40,000		$ 40,000			$ 40,000
Repayments of Lines of Credit								$ 22,800
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months							(100)
Net Gain (Loss) recognized in OCI					347	$ (2)	931	76
Interest expense (income) on interest rate swap					259	255	519	570
Gain (Loss) Reclassified from AOCI into Interest expense					(55)	(119)	(172)	(234)
Derivative liabilities fair value										396
Subsequent Event
Debt Instrument [Line Items]
Proceeds from swap			$ 600
2018 Credit Agreement \| Letter of Credit
Debt Instrument [Line Items]
Letters of credit outstanding					10,000		$ 10,000
Revolving Credit Facility \| Subsequent Event
Debt Instrument [Line Items]
Revolving line of credit									$ 20,000
Prepayment for long-term line of credit	$ 20,000
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					40,000		$ 40,000
Amount of borrowings available					100,000		100,000
Repayments of Lines of Credit					$ 0	$ 13,800	$ 0	$ 22,800
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					1.70%	1.35%	1.35%	1.35%
Revolving Credit Facility \| 2018 Credit Agreement \| Maximum
Debt Instrument [Line Items]
Debt instrument, interest rate					2.87%	1.36%	2.87%	1.65%
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 \| 2022 Credit Agreement
Debt Instrument [Line Items]
Debt Instrument, Maturity Date							Jul. 27, 2027
Revolving Credit Facility \| 2022 Credit Agreement \| Subsequent Event
Debt Instrument [Line Items]
Senior secured revolving facility		$ 150,000
Senior secured revolving facility term		5 years
Revolving Credit Facility \| 2022 Credit Agreement \| Federal Funds Rate \| Subsequent Event
Debt Instrument [Line Items]
Debt instrument basis percentage		0.50%
Revolving Credit Facility \| 2022 Credit Agreement \| Base Rate \| Minimum \| Subsequent Event
Debt Instrument [Line Items]
Debt instrument basis percentage		0.25%
Revolving Credit Facility \| 2022 Credit Agreement \| Base Rate \| Maximum \| Subsequent Event
Debt Instrument [Line Items]
Debt instrument basis percentage		1.25%
Letter of Credit \| 2018 Credit Agreement
Debt Instrument [Line Items]
Sub limit of revolving facility				$ 15,000
Letter of Credit \| 2022 Credit Agreement \| Subsequent Event
Debt Instrument [Line Items]
Sub limit of revolving facility		$ 15,000
Swing Line Loans \| 2018 Credit Agreement
Debt Instrument [Line Items]
Sub limit of revolving facility				$ 15,000
Swing Line Loans \| 2022 Credit Agreement \| Subsequent Event
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, effective interest rate					1.5		1.5
Net Gain (Loss) recognized in OCI					$ 347	$ (2)	$ 931	$ 76
Interest expense (income) on interest rate swap					55	119	172	234
Gain (Loss) Reclassified from AOCI into Interest expense					55	119	172	234
Derivative Asset, Notional Amount					40,000		40,000				$ 40,000
Derivative Liability, Notional Amount										$ 40,000
Derivative assets fair value					$ 706		$ 706
Derivative Asset, Statement of Financial Position [Extensible Enumeration]					Other Assets, Noncurrent		Other Assets, Noncurrent			Other Assets, Noncurrent
Derivative liabilities fair value										$ 396
Derivative Liability, Statement of Financial Position [Extensible Enumeration]					Other Liabilities, Noncurrent		Other Liabilities, Noncurrent			Other Liabilities, Noncurrent
Hedged Debt Instrument [Member]
Debt Instrument [Line Items]
Interest expense (income) on interest rate swap					$ 204	$ 136	$ 347	$ 336

Other Accrued Expenses and Current Liabilities - Schedule of Other Accrued Expenses and Current Liabilities (Detail) - USD ($) $ in Thousands	Jun. 29, 2022	Dec. 29, 2021
Payables And Accruals [Abstract]
Accrued sales and property taxes	$ 3,766	$ 4,726
Gift card liability	4,133	4,622
Loyalty rewards program liability	564	687
Accrued advertising	3,233	3,635
Accrued legal settlements and professional fees	660	771
Deferred franchise and development fees	651	637
Employer social security tax deferral	2,543
Other	3,470	4,718
Total other accrued expenses and current liabilities	$ 19,020	$ 19,796

Other Noncurrent Liabilities - Schedule of Other Noncurrent Liabilities (Detail) - USD ($) $ in Thousands	Jun. 29, 2022	Dec. 29, 2021
Payables And Accruals [Abstract]
Deferred franchise and development fees	$ 5,789	$ 5,691
Derivative liability		396
Employer social security tax deferral		2,426
Other	109	140
Total other noncurrent liabilities	$ 5,898	$ 8,653

Commitments and Contingencies - Additional Information (Details)			6 Months Ended
	Dec. 29, 2021 USD ($)	Sep. 10, 2021 USD ($)	Jun. 29, 2022 USD ($) agreement lease
Officers
Other Commitments [Line Items]
Number of at-will employment agreements \| agreement			3
Property Lease Guarantee
Other Commitments [Line Items]
Number of leases assigned to franchisees \| lease			4
Latest lease expiration year			2036
Contingent lease obligations, maximum exposure			$ 2,500,000
Contingent lease obligations, maximum exposure, if discounted at estimated pre-tax cost of debt			2,100,000
Chicken Acquisition Corp
Other Commitments [Line Items]
Purchase commitments, estimated obligations			$ 26,000,000.0
Diep action
Other Commitments [Line Items]
Proposed settlement payment		$ 625,000
Litigation Settlement, Expense		$ 156,250
Insurance proceeds	$ 469,000

Earnings 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. 29, 2022	Jun. 30, 2021	Jun. 29, 2022	Jun. 30, 2021
Numerator:
Net income	$ 7,141	$ 8,818	$ 9,256	$ 12,782
Denominator:
Weighted-average shares outstanding-Basic (shares)	36,331,099	35,927,781	36,278,423	35,861,493
Weighted-average shares outstanding-Diluted (shares)	36,473,960	36,416,686	36,478,808	36,423,394
Net income per share-Basic (usd per share)	$ 0.20	$ 0.25	$ 0.26	$ 0.36
Net income per share-Diluted (usd per share)	$ 0.20	$ 0.24	$ 0.25	$ 0.35
Anti-dilutive securities not considered in diluted EPS calculation (shares)	952,517	138,117	597,201	65,798

- Definition

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

+ References

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- Definition

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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+ Details

- Definition

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

+ References

+ Details

Earnings Per Share- Schedule of Reconciliation of Basic and Diluted Share Counts (Details) - shares	3 Months Ended		6 Months Ended
	Jun. 29, 2022	Jun. 30, 2021	Jun. 29, 2022	Jun. 30, 2021
Earnings Per Share [Abstract]
Weighted-average shares outstanding-Basic (shares)	36,331,099	35,927,781	36,278,423	35,861,493
Dilutive effect of stock options and restricted shares (shares)	142,861	488,905	200,385	561,901
Weighted-average shares outstanding-Diluted (shares)	36,473,960	36,416,686	36,478,808	36,423,394

Related Party Transactions - Additional Information (Details) - Trimaran Pollo Partners, LLC	6 Months Ended
	Jun. 29, 2022
Related Party Transaction [Line Items]
Noncontrolling ownership percentage	45.30%
Ownership percentage to remove board member	40.00%
Ownership percentage to call special meeting of stockholders	40.00%

Revenue from Contracts with Customers - Additional Information (Details)	6 Months Ended
	Jun. 29, 2022 USD ($) item	Dec. 29, 2021 USD ($)
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Number of revenue streams \| item	2
Accrued Loyalty Rewards Program Liability, Current \| $	$ 600,000	$ 700,000
Loyalty Rewards Program, Expected Loyalty Points Redemption Period	1 year
Loyalty Rewards Program, Award Earned \| $	$ 5
Loyalty Rewards Program, Expiration Period For Inactivity	1 year
Loyalty Rewards Program, Points Needed For One Reward \| item	50
Loyalty Reward Program, unused reward expiration period	6 months
Franchise Rights
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Renewal period	20 years
Franchise agreement term	20 years
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 - Revenues Disaggregated by Revenue Source and Market (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 29, 2022	Jun. 30, 2021	Jun. 29, 2022	Jun. 30, 2021
Disaggregation of Revenue [Line Items]
Total revenue	$ 124,111	$ 121,985	$ 234,159	$ 229,706
Core Market
Disaggregation of Revenue [Line Items]
Total revenue	109,622	106,599	206,795	200,286
Non-Core Market
Disaggregation of Revenue [Line Items]
Total revenue	14,489	15,386	27,364	29,420
Company-operated restaurant revenue
Disaggregation of Revenue [Line Items]
Total revenue	106,454	106,970	200,411	201,131
Company-operated restaurant revenue \| Core Market
Disaggregation of Revenue [Line Items]
Total revenue	101,440	99,429	191,066	186,652
Company-operated restaurant revenue \| Non-Core Market
Disaggregation of Revenue [Line Items]
Total revenue	5,015	7,541	9,345	14,478
Franchise revenue
Disaggregation of Revenue [Line Items]
Total revenue	10,064	8,389	19,319	16,001
Franchise revenue \| Core Market
Disaggregation of Revenue [Line Items]
Total revenue	4,708	4,086	9,058	7,773
Franchise revenue \| Non-Core Market
Disaggregation of Revenue [Line Items]
Total revenue	5,357	4,304	10,262	8,229
Franchise advertising fee revenue
Disaggregation of Revenue [Line Items]
Total revenue	7,593	6,626	14,429	12,574
Franchise advertising fee revenue \| Core Market
Disaggregation of Revenue [Line Items]
Total revenue	3,474	3,084	6,671	5,861
Franchise advertising fee revenue \| Non-Core Market
Disaggregation of Revenue [Line Items]
Total revenue	$ 4,117	$ 3,541	$ 7,757	$ 6,713

- Definition

Amount, including tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value-added and excise.

+ References

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-Name Accounting Standards Codification
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+ Details

Revenue from Contracts with Customers - Revenues Disaggregated by Geographic Market (Details) - Revenue - Geographic Concentration Risk	3 Months Ended		6 Months Ended
	Jun. 29, 2022	Jun. 30, 2021	Jun. 29, 2022	Jun. 30, 2021
Disaggregation of Revenue [Line Items]
Percentage of concentration	100.00%	100.00%	100.00%	100.00%
Greater Los Angeles area market
Disaggregation of Revenue [Line Items]
Percentage of concentration	70.90%	70.60%	70.90%	70.40%
Other markets
Disaggregation of Revenue [Line Items]
Percentage of concentration	29.10%	29.40%	29.10%	29.60%

Revenue from Contracts with Customers - Change in Contract Liabilities (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 29, 2022	Jun. 30, 2021	Jun. 29, 2022	Jun. 30, 2021	Dec. 29, 2021
Gift card liability
Change in Contract with Customer, Liability [Roll Forward]
Revenue recognized - beginning balance	$ 313	$ 286	$ 732	$ 689
Franchise revenue
Change in Contract with Customer, Liability [Roll Forward]
Loyalty rewards liability, beginning balance			6,328	5,628	$ 5,628
Revenue recognized - beginning balance			(383)	(349)
Additional contract liability			495	384
Loyalty rewards liability, ending balance	$ 6,440	$ 5,663	$ 6,440	$ 5,663	$ 6,328

Revenue from Contracts with Customers - Unsatisfied Performance Obligation (Details) $ in Thousands	Jun. 29, 2022 USD ($)
Hardware Services
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Unsatisfied performance obligations	$ 0
Franchise revenue
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Unsatisfied performance obligations	$ 6,440
Franchise revenue \| Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-06-30
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	6 months
Unsatisfied performance obligations	$ 328
Franchise revenue \| Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-12-28
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Unsatisfied performance obligations	$ 601
Franchise revenue \| Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-12-26
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Unsatisfied performance obligations	$ 508
Franchise revenue \| Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-12-25
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Unsatisfied performance obligations	$ 464
Franchise revenue \| Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-12-31
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Unsatisfied performance obligations	$ 441
Franchise revenue \| Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2027-12-30
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Unsatisfied performance obligations	$ 4,098
Loyalty reward program \| Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-06-30
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year

Revenue from Contracts with Customers - Loyalty Reward Liability and Gift Card Liability (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 29, 2022	Jun. 30, 2021	Jun. 29, 2022	Jun. 30, 2021	Dec. 29, 2021
Change in Contract with Customer, Liability [Roll Forward]
Gift card liability	$ 4,133		$ 4,133		$ 4,622
Gift card liability
Change in Contract with Customer, Liability [Roll Forward]
Gift card liability	4,133		4,133		4,622
Revenue recognized - beginning balance	313	$ 286	732	$ 689
Loyalty reward program
Change in Contract with Customer, Liability [Roll Forward]
Loyalty rewards liability, beginning balance			687	$ 900	900
Revenue deferred			1,333		2,677
Revenue recognized			(1,456)		(2,890)
Loyalty rewards liability, ending balance	$ 564		$ 564		$ 687

Leases (Details) $ in Thousands	3 Months Ended		6 Months Ended
Leases (Details) $ in Thousands	Jun. 29, 2022 USD ($) lease restaurant property	Jun. 30, 2021 USD ($) restaurant	Jun. 29, 2022 USD ($) item lease restaurant	Jun. 30, 2021 USD ($) restaurant
Lessee, Lease, Description [Line Items]
Initial lease term	20 years		20 years
Number of renewable options \| item			4
Renewal term	5 years		5 years
Lessee, Operating Lease, Existence of Option to Extend [true false]			true
Number of Restaurants with lease modification \| restaurant		5		12
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability			$ 8,485	$ 11,260
Impairment of Right-of-Use Assets		$ 344	$ 0	407
Texas
Lessee, Lease, Description [Line Items]
Operating Lease, Impairment Loss				$ 400
California
Lessee, Lease, Description [Line Items]
Number of restaurants primarily responsible for impairment \| restaurant	1	3	1	3
Lease Not Yet Commenced [Member]
Lessee, Lease, Description [Line Items]
Number Of Leases \| lease			3
Property Lease [Member]
Lessee, Lease, Description [Line Items]
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability			$ 8,485	$ 11,260
Property Lease [Member] \| Texas
Lessee, Lease, Description [Line Items]
Number of restaurants primarily responsible for impairment \| restaurant				1
Property Lease [Member] \| California
Lessee, Lease, Description [Line Items]
Number of restaurants primarily responsible for impairment \| restaurant				1
Equipment Lease [Member]
Lessee, Lease, Description [Line Items]
Number Of Finance Leases \| lease	10		10
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability			$ 0
Property lease modification [Member]
Lessee, Lease, Description [Line Items]
Number of Restaurants with lease modification \| restaurant	9		13
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability	$ 6,000	$ 6,500	$ 8,500	$ 11,200
Number of properties impacted on original lease classification \| property	1
Original impact of original lease classification	$ 700
Facility Leases [Member]
Lessee, Lease, Description [Line Items]
Number Of Finance Leases \| lease	1		1

Leases - Lease Cost (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Leases - Lease Cost (Details) - USD ($) $ in Thousands	Jun. 29, 2022	Jun. 30, 2021	Jun. 29, 2022	Jun. 30, 2021
Lessee, Lease, Description [Line Items]
Amortization of right-to-use assets	$ 19	$ 23	$ 38	$ 43
Interest on lease liabilities	11	16	24	31
Operating Lease, Cost	6,843	6,919	13,670	13,977
Short-term Lease, Cost	4	5	8	10
Variable Lease, Cost	320	236	574	465
Sublease Income	(1,129)	(798)	(2,257)	(1,594)
Total lease cost	6,068	6,401	12,057	12,932
Operating Expense [Member]
Lessee, Lease, Description [Line Items]
Total lease cost	5,912	6,149	11,742	12,380
General and Administrative Expense
Lessee, Lease, Description [Line Items]
Total lease cost	105	103	210	219
Depreciation and amortization [Member]
Lessee, Lease, Description [Line Items]
Total lease cost	18	22	37	42
Interest Expense
Lessee, Lease, Description [Line Items]
Total lease cost	11	15	24	30
Restructuring Charges [Member]
Lessee, Lease, Description [Line Items]
Total lease cost	22	112	44	261
Property Lease [Member]
Lessee, Lease, Description [Line Items]
Amortization of right-to-use assets	18	22	37	42
Interest on lease liabilities	10	15	22	30
Operating Lease, Cost	6,585	6,626	13,149	13,383
Variable Lease, Cost	171	153	307	275
Sublease Income	(1,129)	(798)	(2,257)	(1,594)
Total lease cost	5,655	6,018	11,258	12,136
Equipment Lease [Member]
Lessee, Lease, Description [Line Items]
Amortization of right-to-use assets	1	1	1	1
Interest on lease liabilities	1	1	2	1
Operating Lease, Cost	258	293	521	594
Short-term Lease, Cost	4	5	8	10
Variable Lease, Cost	149	83	267	190
Total lease cost	$ 413	$ 383	$ 799	$ 796

Leases - Cash and Non-cash Lease Activities (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 29, 2022	Jun. 30, 2021	Dec. 29, 2021
Lessee, Lease, Description [Line Items]
Operating Lease, Payments	$ 14,038	$ 12,932
Finance Lease, Principal Payments	86	53
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability	8,485	11,260
Right-of-Use Asset Obtained in Exchange for Finance Lease Liability	28	196
Derecognition of ROU assets due to terminations, impairment or modifications	(24)	(4,552)
Operating Lease ROU assets	170,816		$ 171,981
Operating lease liabilities	190,508
Property Lease [Member]
Lessee, Lease, Description [Line Items]
Operating Lease, Payments	13,543	12,357
Finance Lease, Principal Payments	58	33
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability	$ 8,485	11,260
Derecognition of ROU assets due to terminations, impairment or modifications		$ (4,513)
Finance Lease, Weighted-average remaining lease term	18 years 4 months 13 days	17 years 7 months 9 days
Operating Lease, Weighted-average remaining lease term	11 years 3 days	11 years 6 months 3 days
Finance Lease, Weighted Average Discount Rate, Percent	2.57%	2.75%
Operating Lease, Weighted Average Discount Rate, Percent	4.47%	4.42%
Equipment Lease [Member]
Lessee, Lease, Description [Line Items]
Operating Lease, Payments	$ 495	$ 575
Finance Lease, Principal Payments	28	20
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability	0
Right-of-Use Asset Obtained in Exchange for Finance Lease Liability	28	196
Derecognition of ROU assets due to terminations, impairment or modifications	$ (24)	$ (39)
Finance Lease, Weighted-average remaining lease term	3 years 8 months 4 days	4 years 5 months 8 days
Operating Lease, Weighted-average remaining lease term	1 year 2 months 8 days	1 year 10 months 13 days
Finance Lease, Weighted Average Discount Rate, Percent	1.53%	1.57%
Operating Lease, Weighted Average Discount Rate, Percent	3.82%	3.92%

Leases - Minimum Future Lease Obligations (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 29, 2022	Dec. 29, 2021
Lessee, Lease, Description [Line Items]
Finance Lease, Liability, Payments, Remainder of Fiscal Year	$ 76
Finance Lease, Liability, Payments Due Year One	151
Finance Lease, Liability, Payments, Due Year Two	151
Finance Lease, Liability, Payments, Due Year Three	147
Finance Lease, Liability, Payments, Due Year Four	114
Thereafter	1,583
Total	2,222
Finance Lease, Liability, Undiscounted Excess Amount	(432)
Present value of lease obligations	$ 1,790
Finance Lease, Liability, Statement of Financial Position [Extensible Enumeration]	Less: current maturities, Obligations under finance leases, net of current portion
Less: current maturities	$ (109)	$ (143)
Obligations under finance leases, net of current portion	1,681	1,712
Operating Leases, Future Minimum Payments Due, Remainder of Fiscal Year	14,130
Operating Leases, Future Minimum Payments, Due in One Year	27,654
Operating Leases, Future Minimum Payments, Due in Two Years	25,313
Operating Leases, Future Minimum Payments, Due in Three Years	23,073
Operating Leases, Future Minimum Payments, Due in Four Years	20,846
Thereafter	133,169
Total	244,185
Lessee, Operating Lease, Liability, Undiscounted Excess Amount	(53,677)
Present value of lease obligations	$ 190,508
Operating Lease, Liability, Statement of Financial Position [Extensible Enumeration]	Less: current maturities, Noncurrent portion
Less: current maturities	$ (20,154)	(19,959)
Noncurrent portion	170,354	$ 171,651
Operating Leases, Future Minimum Payments Due, Future Minimum Sublease Rentals, Remainder Of Fiscal Year	1,869
Operating Leases, Future Minimum Payments Due, Future Minimum Sublease Rentals, Next Twelve Months	3,698
Operating Leases, Future Minimum Payments Due, Future Minimum Sublease Rentals, within Two Years	3,510
Operating Leases, Future Minimum Payments Due, Future Minimum Sublease Rentals, within Three Years	3,115
Operating Leases, Future Minimum Payments Due, Future Minimum Sublease Rentals, within Four Years	2,789
Thereafter	23,165
Total	$ 38,146
Minimum
Lessee, Lease, Description [Line Items]
Imputed interest rate	1.53%
Maximum
Lessee, Lease, Description [Line Items]
Imputed interest rate	4.47%

Leases - Lessor (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
Leases - Lessor (Details) - USD ($) $ in Millions	Jun. 29, 2022	Jun. 30, 2021	Jun. 29, 2022	Jun. 30, 2021
Lessor, Lease, Description [Line Items]
Operating Lease, Lease Income	$ 0.1	$ 0.1	$ 0.2	$ 0.2
Operating Lease, Lease Income, Statement of Income or Comprehensive Income [Extensible Enumeration]	Revenue from Contract with Customer, Excluding Assessed Tax	Revenue from Contract with Customer, Excluding Assessed Tax	Revenue from Contract with Customer, Excluding Assessed Tax	Revenue from Contract with Customer, Excluding Assessed Tax
Minimum
Lessor, Lease, Description [Line Items]
Lessor, Operating Lease, Term of Contract	3 years		3 years
Maximum
Lessor, Lease, Description [Line Items]
Lessor, Operating Lease, Term of Contract	20 years		20 years