Delaware
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84-1303469
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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520 Zang Street, Suite D
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Broomfield, CO
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80021
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer o
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Accelerated filer x
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Non-accelerated filer o
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Smaller reporting company o
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(Do not check if a smaller reporting company)
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Emerging growth company x
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Class
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Outstanding at July 16, 2018
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Class A Common Stock, $0.01 par value per share
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41,298,464 shares
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Page
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July 3,
2018 |
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January 2,
2018 |
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(unaudited)
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Assets
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Current assets:
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Cash and cash equivalents
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$
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3,640
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$
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3,361
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Accounts receivable
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1,714
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2,434
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Inventories
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10,089
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9,929
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Prepaid expenses and other assets
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7,511
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6,258
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Income tax receivable
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122
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76
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Total current assets
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23,076
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22,058
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Property and equipment, net
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144,607
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152,593
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Goodwill
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6,400
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6,400
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Intangibles, net
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1,422
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1,565
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Other assets, net
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2,548
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2,617
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Total long-term assets
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154,977
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163,175
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Total assets
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$
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178,053
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$
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185,233
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Liabilities and Stockholders’ Equity
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Current liabilities:
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Accounts payable
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$
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6,345
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$
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10,929
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Accrued payroll and benefits
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12,482
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11,719
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Accrued expenses and other current liabilities
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24,560
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21,221
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Current portion of long-term debt
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656
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—
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Total current liabilities
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44,043
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43,869
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Long-term debt, net
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62,743
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57,624
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Deferred rent
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37,896
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38,872
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Deferred tax liabilities, net
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165
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416
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Other long-term liabilities
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7,037
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8,591
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Total liabilities
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151,884
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149,372
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Stockholders’ equity:
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Preferred stock—$0.01 par value, 1,000,000 shares authorized and undesignated as of July 3, 2018 and January 2, 2018; no shares issued or outstanding
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—
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—
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Common stock—$0.01 par value, 180,000,000 shares authorized as of July 3, 2018 and January 2, 2018; 43,690,395 issued and 41,266,524 outstanding as of July 3, 2018 and 43,550,329 issued and 41,126,458 outstanding as of January 2, 2018
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437
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436
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Treasury stock, at cost, 2,423,871 shares as of July 3, 2018 and January 2, 2018
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(35,000
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)
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(35,000
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)
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Additional paid-in capital
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172,936
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171,613
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Accumulated deficit
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(112,204
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)
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(101,188
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)
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Total stockholders’ equity
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26,169
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35,861
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Total liabilities and stockholders’ equity
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$
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178,053
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$
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185,233
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Fiscal Quarter Ended
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Two Fiscal Quarters Ended
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||||||||||||
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July 3,
2018 |
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July 4,
2017 |
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July 3,
2018 |
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July 4,
2017 |
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Revenue:
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Restaurant revenue
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$
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116,451
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$
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111,628
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$
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226,064
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$
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227,155
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Franchising royalties and fees
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944
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1,164
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1,857
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2,352
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Total revenue
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117,395
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112,792
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227,921
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229,507
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Costs and expenses:
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Restaurant operating costs (exclusive of depreciation and amortization shown separately below):
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Cost of sales
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31,089
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29,598
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60,345
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61,685
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|
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Labor
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38,043
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36,430
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74,615
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76,024
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Occupancy
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12,357
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12,630
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25,120
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26,631
|
|
||||
Other restaurant operating costs
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16,875
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16,194
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33,773
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33,341
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General and administrative
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14,813
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9,393
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25,081
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20,059
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Depreciation and amortization
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5,797
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6,279
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11,617
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12,546
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Pre-opening
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3
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246
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50
|
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791
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|
||||
Restaurant impairments, closure costs and asset disposals
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2,580
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2,830
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4,160
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24,884
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|
||||
Total costs and expenses
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121,557
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113,600
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234,761
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255,961
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|
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Loss from operations
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(4,162
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)
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(808
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)
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(6,840
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)
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(26,454
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)
|
||||
Loss on extinguishment of debt
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626
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—
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626
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—
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Interest expense, net
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1,154
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927
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2,292
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1,935
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|
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Loss before income taxes
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(5,942
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)
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(1,735
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)
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(9,758
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)
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(28,389
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)
|
||||
(Benefit) provision for income taxes
|
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(7
|
)
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80
|
|
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(248
|
)
|
|
271
|
|
||||
Net loss
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(5,935
|
)
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(1,815
|
)
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(9,510
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)
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(28,660
|
)
|
||||
Accretion of preferred stock to redemption value
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—
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(7,001
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)
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—
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(7,967
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)
|
||||
Net loss attributable to common stockholders
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|
$
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(5,935
|
)
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|
$
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(8,816
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)
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$
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(9,510
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)
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$
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(36,627
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)
|
Loss per share of Class A and Class B common stock, combined:
|
|
|
|
|
|
|
|
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||||||||
Basic
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|
$
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(0.14
|
)
|
|
$
|
(0.22
|
)
|
|
$
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(0.23
|
)
|
|
$
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(1.06
|
)
|
Diluted
|
|
$
|
(0.14
|
)
|
|
$
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(0.22
|
)
|
|
$
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(0.23
|
)
|
|
$
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(1.06
|
)
|
Weighted average shares of Class A and Class B common stock outstanding, combined:
|
|
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|
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||||||||
Basic
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|
41,172,924
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|
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40,779,277
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|
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41,150,698
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|
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34,404,222
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|
||||
Diluted
|
|
41,172,924
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|
|
40,779,277
|
|
|
41,150,698
|
|
|
34,404,222
|
|
|
|
Fiscal Quarter Ended
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|
Two Fiscal Quarters Ended
|
||||||||||||
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|
July 3,
2018 |
|
July 4,
2017 |
|
July 3,
2018 |
|
July 4,
2017 |
||||||||
Net loss
|
|
$
|
(5,935
|
)
|
|
$
|
(1,815
|
)
|
|
$
|
(9,510
|
)
|
|
$
|
(28,660
|
)
|
Other comprehensive loss:
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments
|
|
—
|
|
|
(9
|
)
|
|
—
|
|
|
(9
|
)
|
||||
Other comprehensive loss
|
|
—
|
|
|
(9
|
)
|
|
—
|
|
|
(9
|
)
|
||||
Comprehensive loss
|
|
$
|
(5,935
|
)
|
|
$
|
(1,824
|
)
|
|
$
|
(9,510
|
)
|
|
$
|
(28,669
|
)
|
|
|
Two Fiscal Quarters Ended
|
||||||
|
|
July 3,
2018 |
|
July 4,
2017 |
||||
Operating activities
|
|
|
|
|
||||
Net loss
|
|
$
|
(9,510
|
)
|
|
$
|
(28,660
|
)
|
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
|
|
|
|
|
||||
Depreciation and amortization
|
|
11,617
|
|
|
12,546
|
|
||
Deferred income taxes
|
|
(251
|
)
|
|
271
|
|
||
Restaurant impairments, closure costs and asset disposals
|
|
3,669
|
|
|
19,441
|
|
||
Loss on extinguishment of debt
|
|
626
|
|
|
—
|
|
||
Amortization of debt issuance costs
|
|
363
|
|
|
185
|
|
||
Stock-based compensation
|
|
1,592
|
|
|
945
|
|
||
Non-cash gain on litigation settlement
|
|
—
|
|
|
(421
|
)
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
||||
Accounts receivable
|
|
837
|
|
|
2,465
|
|
||
Inventories
|
|
(751
|
)
|
|
(468
|
)
|
||
Prepaid expenses and other assets
|
|
(1,184
|
)
|
|
46
|
|
||
Accounts payable
|
|
(2,909
|
)
|
|
17
|
|
||
Deferred rent
|
|
(975
|
)
|
|
1,479
|
|
||
Income taxes
|
|
(46
|
)
|
|
60
|
|
||
Accrued expenses and other liabilities
|
|
(241
|
)
|
|
(16,137
|
)
|
||
Net cash provided by (used in) operating activities
|
|
2,837
|
|
|
(8,231
|
)
|
||
Investing activities
|
|
|
|
|
||||
Purchases of property and equipment
|
|
(7,051
|
)
|
|
(12,213
|
)
|
||
Net cash used in investing activities
|
|
(7,051
|
)
|
|
(12,213
|
)
|
||
Financing activities
|
|
|
|
|
||||
Net (payments) borrowings from swing line loan
|
|
(101
|
)
|
|
6,947
|
|
||
Proceeds from issuance of long-term debt
|
|
73,389
|
|
|
6,757
|
|
||
Payments on long-term debt
|
|
(66,873
|
)
|
|
(37,015
|
)
|
||
Issuance of preferred stock and common stock warrants, net of transaction expenses (see Note 9)
|
|
—
|
|
|
16,589
|
|
||
Issuance of common stock, net of transaction expenses (see Note 9)
|
|
—
|
|
|
29,110
|
|
||
Proceeds from exercise of stock options and employee stock purchase plan
|
|
(293
|
)
|
|
37
|
|
||
Debt issuance costs
|
|
(1,629
|
)
|
|
(662
|
)
|
||
Net cash provided by financing activities
|
|
4,493
|
|
|
21,763
|
|
||
Effect of exchange rate changes on cash
|
|
—
|
|
|
2
|
|
||
Net increase in cash and cash equivalents
|
|
279
|
|
|
1,321
|
|
||
Cash and cash equivalents
|
|
|
|
|
||||
Beginning of period
|
|
3,361
|
|
|
1,837
|
|
||
End of period
|
|
$
|
3,640
|
|
|
$
|
3,158
|
|
|
|
July 3,
2018 |
|
January 2,
2018 |
||||
Leasehold improvements
|
|
$
|
198,798
|
|
|
$
|
199,211
|
|
Furniture, fixtures and equipment
|
|
120,587
|
|
|
120,234
|
|
||
Construction in progress
|
|
2,725
|
|
|
2,592
|
|
||
|
|
322,110
|
|
|
322,037
|
|
||
Accumulated depreciation and amortization
|
|
(177,503
|
)
|
|
(169,444
|
)
|
||
|
|
$
|
144,607
|
|
|
$
|
152,593
|
|
|
|
July 3,
2018 |
|
January 2,
2018 |
||||
Gift card liability
|
|
$
|
2,766
|
|
|
$
|
4,078
|
|
Occupancy related
|
|
4,283
|
|
|
3,733
|
|
||
Utilities
|
|
1,670
|
|
|
1,705
|
|
||
Data breach liabilities
|
|
11,016
|
|
|
7,605
|
|
||
Other accrued expenses
|
|
4,825
|
|
|
4,100
|
|
||
|
|
$
|
24,560
|
|
|
$
|
21,221
|
|
Year 1
|
$
|
656
|
|
Year 2
|
937
|
|
|
Year 3
|
1,656
|
|
|
Year 4
|
61,983
|
|
|
Total
|
$
|
65,232
|
|
|
|
Fiscal Quarter Ended
|
|
Two Fiscal Quarters Ended
|
||||||||||||
|
|
July 3,
2018 |
|
July 4,
2017 |
|
July 3,
2018 |
|
July 4,
2017 |
||||||||
(Benefit) provision for income taxes
|
|
$
|
(7
|
)
|
|
$
|
80
|
|
|
$
|
(248
|
)
|
|
$
|
271
|
|
Effective tax rate
|
|
0.1
|
%
|
|
(4.6
|
)%
|
|
2.5
|
%
|
|
(1.0
|
)%
|
|
Fiscal Quarter Ended
|
|
Two Fiscal Quarters Ended
|
||||||||||||
|
July 3,
2018 |
|
July 4,
2017 |
|
July 3,
2018 |
|
July 4,
2017 |
||||||||
Stock-based compensation expense
|
$
|
1,012
|
|
|
$
|
648
|
|
|
$
|
1,592
|
|
|
$
|
945
|
|
Capitalized stock-based compensation expense
|
$
|
13
|
|
|
$
|
52
|
|
|
$
|
25
|
|
|
$
|
102
|
|
|
Fiscal Quarter Ended
|
|
Two Fiscal Quarters Ended
|
||||||||||||
|
July 3,
2018 |
|
July 4,
2017 |
|
July 3,
2018 |
|
July 4,
2017 |
||||||||
Restaurant impairments (1)
|
$
|
319
|
|
|
$
|
4,037
|
|
|
$
|
917
|
|
|
$
|
5,973
|
|
Closure costs (1)
|
1,519
|
|
|
(1,471
|
)
|
|
2,073
|
|
|
18,415
|
|
||||
Loss on disposal of assets and other
|
742
|
|
|
264
|
|
|
1,170
|
|
|
496
|
|
||||
|
$
|
2,580
|
|
|
$
|
2,830
|
|
|
$
|
4,160
|
|
|
$
|
24,884
|
|
(1)
|
Restaurant impairments and closure costs in all periods presented above include amounts related to restaurants previously impaired or closed.
|
|
|
Fiscal Quarter Ended
|
|
Two Fiscal Quarters Ended
|
||||||||||||
|
|
July 3,
2018 |
|
July 4,
2017 |
|
July 3,
2018 |
|
July 4,
2017 |
||||||||
Net loss attributable to common stockholders
|
|
$
|
(5,935
|
)
|
|
$
|
(8,816
|
)
|
|
$
|
(9,510
|
)
|
|
$
|
(36,627
|
)
|
Shares:
|
|
|
|
|
|
|
|
|
||||||||
Basic weighted average shares outstanding
|
|
41,172,924
|
|
|
40,779,277
|
|
|
41,150,698
|
|
|
34,404,222
|
|
||||
Effect of dilutive securities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Diluted weighted average shares outstanding
|
|
41,172,924
|
|
|
40,779,277
|
|
|
41,150,698
|
|
|
34,404,222
|
|
||||
Loss per share:
|
|
|
|
|
|
|
|
|
||||||||
Basic loss per share
|
|
$
|
(0.14
|
)
|
|
$
|
(0.22
|
)
|
|
$
|
(0.23
|
)
|
|
$
|
(1.06
|
)
|
Diluted loss per share
|
|
$
|
(0.14
|
)
|
|
$
|
(0.22
|
)
|
|
$
|
(0.23
|
)
|
|
$
|
(1.06
|
)
|
|
|
July 3,
2018 |
|
July 4,
2017 |
||||
Interest paid (net of amounts capitalized)
|
|
$
|
1,973
|
|
|
$
|
2,216
|
|
Income taxes paid (refunded)
|
|
49
|
|
|
(60
|
)
|
||
Changes in purchases of property and equipment accrued in accounts payable, net
|
|
(1,580
|
)
|
|
(1,417
|
)
|
||
Conversion of Series A convertible preferred stock to common stock
|
|
—
|
|
|
18,500
|
|
•
|
consumer recognition of our brand and our ability to respond to changing consumer preferences;
|
•
|
overall economic trends, particularly those related to consumer spending;
|
•
|
our ability to operate restaurants effectively and efficiently to meet consumer expectations;
|
•
|
pricing;
|
•
|
the number of restaurant transactions, per-person spend and average check amount;
|
•
|
marketing and promotional efforts;
|
•
|
weather;
|
•
|
food safety and foodborne illness concerns;
|
•
|
local competition;
|
•
|
trade area dynamics;
|
•
|
introduction of new and seasonal menu items and limited time offerings; and
|
•
|
opening new restaurants in the vicinity of existing locations.
|
|
|
Fiscal Quarter Ended
|
|
Two Fiscal Quarters Ended
|
||||||||||||
|
|
July 3,
2018 |
|
July 4,
2017 |
|
July 3,
2018 |
|
July 4,
2017 |
||||||||
|
|
(in thousands, unaudited)
|
||||||||||||||
Net loss
|
|
$
|
(5,935
|
)
|
|
$
|
(1,815
|
)
|
|
$
|
(9,510
|
)
|
|
$
|
(28,660
|
)
|
Depreciation and amortization
|
|
5,797
|
|
|
6,279
|
|
|
11,617
|
|
|
12,546
|
|
||||
Interest expense, net
|
|
1,154
|
|
|
927
|
|
|
2,292
|
|
|
1,935
|
|
||||
(Benefit) provision for income taxes
|
|
(7
|
)
|
|
80
|
|
|
(248
|
)
|
|
271
|
|
||||
EBITDA
|
|
$
|
1,009
|
|
|
$
|
5,471
|
|
|
$
|
4,151
|
|
|
$
|
(13,908
|
)
|
Restaurant impairments, closure costs and asset disposals (1)
|
|
2,580
|
|
|
2,830
|
|
|
4,160
|
|
|
24,884
|
|
||||
Litigation settlement (2)
|
|
3,796
|
|
|
(421
|
)
|
|
3,796
|
|
|
(421
|
)
|
||||
Fees and costs related to registration statements and related transactions (3)
|
|
53
|
|
|
40
|
|
|
53
|
|
|
679
|
|
||||
Loss on extinguishment of debt (4)
|
|
626
|
|
|
—
|
|
|
626
|
|
|
—
|
|
||||
Severance costs (5)
|
|
—
|
|
|
129
|
|
|
278
|
|
|
332
|
|
||||
Stock-based compensation expense
|
|
1,012
|
|
|
647
|
|
|
1,592
|
|
|
945
|
|
||||
Adjusted EBITDA
|
|
$
|
9,076
|
|
|
$
|
8,696
|
|
|
$
|
14,656
|
|
|
$
|
12,511
|
|
(1)
|
Restaurant impairments and closure costs in all periods presented above include amounts related to restaurants previously impaired or closed. Additionally, the first two quarters of 2018 includes closure costs of the nine restaurants closed in the first two quarters of 2018, most of which were approaching the expiration of their leases, and the impairment of one restaurant, and the first two quarters of 2017 includes the closure costs related to the 55 restaurants closed in the first quarter of 2017 and the impairment of 13 restaurants. See Note 7, Restaurant Impairments, Closure Costs and Asset Disposals.
|
(2)
|
The second quarter of 2018 includes a charge of $3.4 million for the final assessment related to data breach liabilities, and a $0.3 million charge for a litigation settlement related to the Delaware gift card matter. The second quarter of 2017 includes a gain on an employment-related litigation settlement due to final settlement being less than what the Company had previously accrued.
|
(3)
|
The second quarter of 2018 includes expenses related to the registration statement the Company filed in the second quarter of 2018. The first two quarters of 2017 includes expenses related to the registration statement the Company filed in the first quarter of 2017, which registration statement was later withdrawn.
|
(4)
|
The second quarter of 2018 includes the loss on extinguishment of debt which resulted from writing off the remaining unamortized balance of debt issuance costs related to the prior credit facility when it was repaid in full in the second quarter of 2018.
|
(5)
|
The first two quarters of 2018 and 2017 include severance costs from departmental structural changes.
|
|
|
Fiscal Quarter Ended
|
|
Two Fiscal Quarters Ended
|
||||||||
|
|
July 3,
2018 |
|
July 4,
2017 |
|
July 3,
2018 |
|
July 4,
2017 |
||||
Company-Owned Restaurant Activity
|
|
|
|
|
|
|
|
|
||||
Beginning of period
|
|
411
|
|
|
409
|
|
|
412
|
|
|
457
|
|
Openings
|
|
—
|
|
|
4
|
|
|
1
|
|
|
11
|
|
Closures
|
|
(7
|
)
|
|
—
|
|
|
(9
|
)
|
|
(55
|
)
|
Restaurants at end of period
|
|
404
|
|
|
413
|
|
|
404
|
|
|
413
|
|
Franchise Restaurant Activity
|
|
|
|
|
|
|
|
|
||||
Beginning of period
|
|
65
|
|
|
73
|
|
|
66
|
|
|
75
|
|
Openings
|
|
—
|
|
|
1
|
|
|
—
|
|
|
2
|
|
Closures
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|
(4
|
)
|
Restaurants at end of period
|
|
65
|
|
|
73
|
|
|
65
|
|
|
73
|
|
Total restaurants
|
|
469
|
|
|
486
|
|
|
469
|
|
|
486
|
|
|
|
Fiscal Quarter Ended
|
|
Two Fiscal Quarters Ended
|
||||||||
|
|
July 3,
2018 |
|
July 4,
2017 |
|
July 3,
2018 |
|
July 4,
2017 |
||||
Revenue:
|
|
|
|
|
|
|
|
|
||||
Restaurant revenue
|
|
99.2
|
%
|
|
99.0
|
%
|
|
99.2
|
%
|
|
99.0
|
%
|
Franchising royalties and fees
|
|
0.8
|
%
|
|
1.0
|
%
|
|
0.8
|
%
|
|
1.0
|
%
|
Total revenue
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
||||
Restaurant operating costs (exclusive of depreciation and amortization shown separately below): (1)
|
|
|
|
|
|
|
|
|
||||
Cost of sales
|
|
26.7
|
%
|
|
26.5
|
%
|
|
26.7
|
%
|
|
27.2
|
%
|
Labor
|
|
32.7
|
%
|
|
32.6
|
%
|
|
33.0
|
%
|
|
33.5
|
%
|
Occupancy
|
|
10.6
|
%
|
|
11.3
|
%
|
|
11.1
|
%
|
|
11.7
|
%
|
Other restaurant operating costs
|
|
14.5
|
%
|
|
14.5
|
%
|
|
14.9
|
%
|
|
14.7
|
%
|
General and administrative
|
|
12.6
|
%
|
|
8.3
|
%
|
|
11.0
|
%
|
|
8.7
|
%
|
Depreciation and amortization
|
|
4.9
|
%
|
|
5.6
|
%
|
|
5.1
|
%
|
|
5.5
|
%
|
Pre-opening
|
|
—
|
%
|
|
0.2
|
%
|
|
—
|
%
|
|
0.3
|
%
|
Restaurant impairments, closure costs and asset disposals
|
|
2.2
|
%
|
|
2.5
|
%
|
|
1.8
|
%
|
|
10.8
|
%
|
Total costs and expenses
|
|
103.5
|
%
|
|
100.7
|
%
|
|
103.0
|
%
|
|
111.5
|
%
|
Loss from operations
|
|
(3.5
|
)%
|
|
(0.7
|
)%
|
|
(3.0
|
)%
|
|
(11.5
|
)%
|
Loss on extinguishment of debt
|
|
0.5
|
%
|
|
—
|
%
|
|
0.3
|
%
|
|
—
|
%
|
Interest expense, net
|
|
1.0
|
%
|
|
0.8
|
%
|
|
1.0
|
%
|
|
0.8
|
%
|
Loss before income taxes
|
|
(5.1
|
)%
|
|
(1.5
|
)%
|
|
(4.3
|
)%
|
|
(12.4
|
)%
|
(Benefit) provision for income taxes
|
|
—
|
%
|
|
0.1
|
%
|
|
(0.1
|
)%
|
|
0.1
|
%
|
Net loss
|
|
(5.1
|
)%
|
|
(1.6
|
)%
|
|
(4.2
|
)%
|
|
(12.5
|
)%
|
(1)
|
As a percentage of restaurant revenue.
|
|
|
Fiscal Quarter Ended
|
|
Increase / (Decrease)
|
|||||||||||
|
|
July 3,
2018 |
|
July 4,
2017 |
|
$
|
|
%
|
|||||||
|
|
|
|
||||||||||||
|
|
(in thousands)
|
|||||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|||||||
Restaurant revenue
|
|
$
|
116,451
|
|
|
$
|
111,628
|
|
|
$
|
4,823
|
|
|
4.3
|
%
|
Franchising royalties and fees
|
|
944
|
|
|
1,164
|
|
|
(220
|
)
|
|
(18.9
|
)%
|
|||
Total revenue
|
|
117,395
|
|
|
112,792
|
|
|
4,603
|
|
|
4.1
|
%
|
|||
Costs and expenses:
|
|
|
|
|
|
|
|
|
|||||||
Restaurant operating costs (exclusive of depreciation and amortization shown separately below):
|
|
|
|
|
|
|
|
|
|||||||
Cost of sales
|
|
31,089
|
|
|
29,598
|
|
|
1,491
|
|
|
5.0
|
%
|
|||
Labor
|
|
38,043
|
|
|
36,430
|
|
|
1,613
|
|
|
4.4
|
%
|
|||
Occupancy
|
|
12,357
|
|
|
12,630
|
|
|
(273
|
)
|
|
(2.2
|
)%
|
|||
Other restaurant operating costs
|
|
16,875
|
|
|
16,194
|
|
|
681
|
|
|
4.2
|
%
|
|||
General and administrative
|
|
14,813
|
|
|
9,393
|
|
|
5,420
|
|
|
57.7
|
%
|
|||
Depreciation and amortization
|
|
5,797
|
|
|
6,279
|
|
|
(482
|
)
|
|
(7.7
|
)%
|
|||
Pre-opening
|
|
3
|
|
|
246
|
|
|
(243
|
)
|
|
(98.8
|
)%
|
|||
Restaurant impairments, asset disposals and closure costs
|
|
2,580
|
|
|
2,830
|
|
|
(250
|
)
|
|
(8.8
|
)%
|
|||
Total costs and expenses
|
|
121,557
|
|
|
113,600
|
|
|
7,957
|
|
|
7.0
|
%
|
|||
Loss from operations
|
|
(4,162
|
)
|
|
(808
|
)
|
|
(3,354
|
)
|
|
*
|
|
|||
Loss on extinguishment of debt
|
|
626
|
|
|
—
|
|
|
626
|
|
|
100.0
|
%
|
|||
Interest expense, net
|
|
1,154
|
|
|
927
|
|
|
227
|
|
|
24.5
|
%
|
|||
Loss before income taxes
|
|
(5,942
|
)
|
|
(1,735
|
)
|
|
(4,207
|
)
|
|
*
|
|
|||
(Benefit) provision for income taxes
|
|
(7
|
)
|
|
80
|
|
|
(87
|
)
|
|
*
|
|
|||
Net loss
|
|
$
|
(5,935
|
)
|
|
$
|
(1,815
|
)
|
|
$
|
(4,120
|
)
|
|
*
|
|
Company-owned:
|
|
|
|
|
|
|
|
|
|||||||
Average unit volumes
|
|
$
|
1,092
|
|
|
$
|
1,065
|
|
|
$
|
27
|
|
|
2.5
|
%
|
Comparable restaurant sales
|
|
5.0
|
%
|
|
(3.9
|
)%
|
|
|
|
|
|
|
*
|
Not meaningful.
|
|
|
Two Fiscal Quarters Ended
|
|
Increase / (Decrease)
|
|||||||||||
|
|
July 3,
2018 |
|
July 4,
2017 |
|
$
|
|
%
|
|||||||
|
|
|
|
||||||||||||
|
|
(in thousands, except percentages)
|
|||||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|||||||
Restaurant revenue
|
|
$
|
226,064
|
|
|
$
|
227,155
|
|
|
$
|
(1,091
|
)
|
|
(0.5
|
)%
|
Franchising royalties and fees
|
|
1,857
|
|
|
2,352
|
|
|
(495
|
)
|
|
(21.0
|
)%
|
|||
Total revenue
|
|
227,921
|
|
|
229,507
|
|
|
(1,586
|
)
|
|
(0.7
|
)%
|
|||
Costs and expenses:
|
|
|
|
|
|
|
|
|
|||||||
Restaurant operating costs (exclusive of depreciation and amortization shown separately below):
|
|
|
|
|
|
|
|
|
|||||||
Cost of sales
|
|
60,345
|
|
|
61,685
|
|
|
(1,340
|
)
|
|
(2.2
|
)%
|
|||
Labor
|
|
74,615
|
|
|
76,024
|
|
|
(1,409
|
)
|
|
(1.9
|
)%
|
|||
Occupancy
|
|
25,120
|
|
|
26,631
|
|
|
(1,511
|
)
|
|
(5.7
|
)%
|
|||
Other restaurant operating costs
|
|
33,773
|
|
|
33,341
|
|
|
432
|
|
|
1.3
|
%
|
|||
General and administrative
|
|
25,081
|
|
|
20,059
|
|
|
5,022
|
|
|
25.0
|
%
|
|||
Depreciation and amortization
|
|
11,617
|
|
|
12,546
|
|
|
(929
|
)
|
|
(7.4
|
)%
|
|||
Pre-opening
|
|
50
|
|
|
791
|
|
|
(741
|
)
|
|
(93.7
|
)%
|
|||
Restaurant impairments, asset disposals and closure costs
|
|
4,160
|
|
|
24,884
|
|
|
(20,724
|
)
|
|
(83.3
|
)%
|
|||
Total costs and expenses
|
|
234,761
|
|
|
255,961
|
|
|
(21,200
|
)
|
|
(8.3
|
)%
|
|||
Loss from operations
|
|
(6,840
|
)
|
|
(26,454
|
)
|
|
19,614
|
|
|
74.1
|
%
|
|||
Loss on extinguishment of debt
|
|
626
|
|
|
—
|
|
|
626
|
|
|
100.0
|
%
|
|||
Interest expense, net
|
|
2,292
|
|
|
1,935
|
|
|
357
|
|
|
18.4
|
%
|
|||
Loss before income taxes
|
|
(9,758
|
)
|
|
(28,389
|
)
|
|
19,257
|
|
|
65.6
|
%
|
|||
(Benefit) provision for income taxes
|
|
(248
|
)
|
|
271
|
|
|
(519
|
)
|
|
*
|
|
|||
Net loss
|
|
$
|
(9,510
|
)
|
|
$
|
(28,660
|
)
|
|
$
|
19,150
|
|
|
66.8
|
%
|
Company-owned:
|
|
|
|
|
|
|
|
|
|||||||
Average unit volumes
|
|
$
|
1,092
|
|
|
$
|
1,065
|
|
|
$
|
27
|
|
|
2.5
|
%
|
Comparable restaurant sales
|
|
2.4
|
%
|
|
(3.2
|
)%
|
|
|
|
|
|
|
*
|
Not meaningful.
|
|
|
Two Fiscal Quarters Ended
|
||||||
|
|
July 3,
2018 |
|
July 4,
2017 |
||||
Net cash provided by (used in) operating activities
|
|
$
|
2,837
|
|
|
$
|
(8,231
|
)
|
Net cash used in investing activities
|
|
(7,051
|
)
|
|
(12,213
|
)
|
||
Net cash provided by financing activities
|
|
4,493
|
|
|
21,763
|
|
||
Effect of exchange rate changes on cash
|
|
$
|
—
|
|
|
$
|
2
|
|
Net increase in cash and cash equivalents
|
|
$
|
279
|
|
|
$
|
1,321
|
|
Exhibit Number
|
|
Description of Exhibit
|
|
10.1
|
|
|
|
31.1
|
|
|
|
32.1
|
|
|
|
101.INS
|
|
|
XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
|
101.SCH
|
|
|
XBRL Taxonomy Extension Schema Document
|
101.CAL
|
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF
|
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB
|
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE
|
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
NOODLES & COMPANY
|
|
By:
|
/s/ DAVE BOENNIGHAUSEN
|
|
Dave Boennighausen
Chief Executive Officer and Principal Financial Officer
|
Date
|
July 19, 2018
|
•
|
Sales Growth of less than 0.33%: None of the Sales-Based PSUs will be earned or eligible to vest.
|
•
|
Sales Growth of at least 0.33% (“Threshold Sales Growth Goal”): 25% of Sales-Based PSUs will be earned and eligible to vest.
|
•
|
Sales Growth of at least 2.0% (“Target Sales Growth Goal”): 100% of Sales-Based PSUs will be earned and eligible to vest.
|
•
|
Sales Growth of at least 4.0% (“Maximum Sales Growth Goal”): 200% of Sales-Based PSUs will be earned and eligible to vest.
|
•
|
Adjusted EBITDA of less than $95,400,000: None of the EBITDA-Based PSUs will be earned and be eligible to vest.
|
•
|
Adjusted EBITDA of at least $95,400,000 (“Threshold EBITDA Goal”): 25% of EBITDA-Based PSUs will be earned and eligible to vest.
|
•
|
Adjusted EBITDA of at least $106,300,000 (“Target EBITDA Goal”): 100% of EBITDA-Based PSUs will be earned and eligible to vest.
|
•
|
Adjusted EBITDA of at least $124,000,000 (“Maximum EBITDA Goal”): 200% of EBITDA-Based PSUs will be earned and eligible to vest.
|
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
/s/ DAVE BOENNIGHAUSEN
|
|
|
Dave Boennighausen
|
|
|
Chief Executive Officer
(Principal Executive Officer and Principal Financial Officer)
|
|
By:
|
|
/s/ DAVE BOENNIGHAUSEN
|
|
Name:
|
|
Dave Boennighausen
|
|
Title:
|
|
Chief Executive Officer and Principal Financial Officer
|