Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Dec. 29, 2014 | Mar. 19, 2015 | Jun. 30, 2014 |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | COSI INC | ||
Entity Central Index Key | 1171014 | ||
Current Fiscal Year End Date | -17 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $20.10 | ||
Entity Common Stock, Shares Outstanding | 38,310,196 | ||
Document Fiscal Year Focus | 2014 | ||
Document Fiscal Period Focus | FY | ||
Document Type | 10-K | ||
Amendment Flag | FALSE | ||
Document Period End Date | 29-Dec-14 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 29, 2014 | Dec. 30, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents | $21,560 | $6,021 |
Accounts receivable, net | 581 | 594 |
Notes receivable | 551 | 551 |
Inventories | 825 | 779 |
Prepaid expenses and other current assets | 1,279 | 1,348 |
Total current assets | 24,796 | 9,293 |
Furniture and fixtures, equipment and leasehold improvements, net | 7,308 | 8,195 |
Other assets | 1,327 | 1,115 |
Total assets | 33,431 | 18,603 |
Current liabilities: | ||
Accounts payable | 1,519 | 2,462 |
Accrued expenses | 9,336 | 9,088 |
Deferred franchise revenue | 18 | 18 |
Current portion of other long-term liabilities | 177 | 196 |
Total current liabilities | 11,050 | 11,764 |
Long-term debt, net | 6,623 | 0 |
Deferred franchise revenue | 1,724 | 1,931 |
Other long-term liabilities, net of current portion | 1,663 | 2,189 |
Total liabilities | 21,060 | 15,884 |
Stockholders' equity: | ||
Common stock - $.01 par value; 100,000,000 shares authorized, 38,410,196 and 18,106,979 shares issued, respectively | 383 | 181 |
Additional paid-in capital | 323,256 | 297,181 |
Treasury stock, 59,886 shares at cost | -1,198 | -1,198 |
Accumulated deficit | -310,070 | -293,445 |
Total stockholders' equity | 12,371 | 2,719 |
Total liabilities and stockholders' equity | $33,431 | $18,603 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 29, 2014 | Dec. 30, 2013 |
Stockholders' equity: | ||
Common stock, par value (in dollars per share) | $0.01 | $0.01 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 38,410,196 | 18,106,979 |
Treasury stock, shares (in shares) | 59,886 | 59,886 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations and Comprehensive Loss (USD $) | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Dec. 29, 2014 | Dec. 30, 2013 | Dec. 31, 2012 |
Revenues: | |||
Restaurant net sales | $74,905 | $83,338 | $94,757 |
Franchise fees and royalties | 2,853 | 2,989 | 3,195 |
Total revenues | 77,758 | 86,327 | 97,952 |
Costs and expenses: | |||
Cost of food and beverage | 20,078 | 20,736 | 22,171 |
Restaurant labor and related benefits | 29,046 | 32,379 | 34,165 |
Occupancy and other restaurant operating expenses | 27,720 | 28,971 | 30,337 |
Total operating costs and expenses | 76,844 | 82,086 | 86,673 |
General and administrative expenses | 12,359 | 11,746 | 11,641 |
Depreciation and amortization | 2,394 | 2,724 | 3,613 |
Restaurant pre-opening expenses | 15 | 29 | 0 |
Provision for losses on asset impairments and disposals | 346 | 1,122 | 424 |
Closed store costs | 172 | 124 | 117 |
Lease termination expense (income), net | 1,468 | 57 | -13 |
Gain on sale of assets | -50 | -34 | 0 |
Total costs and expenses | 93,548 | 97,854 | 102,455 |
Operating loss | -15,790 | -11,527 | -4,503 |
Other income (expense): | |||
Interest expense | -471 | 0 | 0 |
Debt issuance amortization | -446 | 0 | 0 |
Other income | 82 | 83 | 62 |
Total other income (expense) | -835 | 83 | 62 |
Net loss and comprehensive loss | ($16,625) | ($11,444) | ($4,441) |
Per Share Data: | |||
Loss per share, basic and diluted (in dollars per share) | ($0.82) | ($0.64) | ($0.29) |
Weighted average common shares outstanding (in shares) | 20,271,585 | 17,993,858 | 15,207,588 |
Consolidated_Statements_of_Sto
Consolidated Statements of Stockholders' Equity (USD $) | Common Stock [Member] | Additional Paid In Capital [Member] | Treasury Stock [Member] | Accumulated Deficit [Member] | Total | |
Balance at Jan. 02, 2012 | $132,000 | $284,144,000 | ($1,198,000) | ($277,560,000) | $5,518,000 | |
Balance (in shares) at Jan. 02, 2012 | 13,241,841 | 59,886 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock, net of issuance costs | [1] | 50,000 | 12,509,000 | 12,559,000 | ||
Issuance of common stock, net of issuance costs (in shares) | [1] | 4,915,461 | ||||
Issuance of restricted stock, net of forfeitures | 1,000 | -1,000 | 0 | |||
Issuance of restricted stock, net of forfeitures (in shares) | 120,890 | |||||
Stock-based compensation | 399,000 | 399,000 | ||||
Net loss | -4,441,000 | -4,441,000 | ||||
Balance at Dec. 31, 2012 | 183,000 | 297,051,000 | -1,198,000 | -282,001,000 | 14,035,000 | |
Balance (in shares) at Dec. 31, 2012 | 18,278,192 | 59,886 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Forfeiture of restricted stock | -2,000 | 2,000 | 0 | |||
Forfeiture of restricted stock (in shares) | -171,213 | |||||
Stock-based compensation | 128,000 | 128,000 | ||||
Net loss | -11,444,000 | -11,444,000 | ||||
Balance at Dec. 30, 2013 | 181,000 | 297,181,000 | -1,198,000 | -293,445,000 | 2,719,000 | |
Balance (in shares) at Dec. 30, 2013 | 18,106,979 | 59,886 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock, net of issuance costs | [2] | 172,000 | 24,014,000 | 24,186,000 | ||
Issuance of common stock, net of issuance costs (in shares) | [2] | 17,222,942 | ||||
Issuance of restricted stock, net of forfeitures | 14,000 | -14,000 | 0 | |||
Issuance of restricted stock, net of forfeitures (in shares) | 1,433,170 | |||||
Stock-based compensation | 0 | 509,000 | 509,000 | |||
Share-based compensation (in shares) | 0 | |||||
Issuance of warrants | [3] | 0 | 1,571,000 | 1,571,000 | ||
Exercise of warrants to purchase common stock | [4] | 16,000 | -5,000 | 11,000 | ||
Exercise of warrants to purchase common stock (in shares) | [4] | 1,647,105 | ||||
Net loss | -16,625,000 | -16,625,000 | ||||
Balance at Dec. 29, 2014 | $383,000 | $323,256,000 | ($1,198,000) | ($310,070,000) | $12,371,000 | |
Balance (in shares) at Dec. 29, 2014 | 38,410,196 | 59,886 | ||||
[1] | Represents the proceeds, net of issuance costs, of approximately $221,000 from the shareholder rights offering and related private placement to directors and officers of the Company, completed in July 2012 | |||||
[2] | Represents the proceeds from the shareholder rights offering of approximately 13.3 million of unregistered shares completed December 23, 2014 and proceeds from Stock Purchase Agreement for the purchase of approximately 3.9 million unregistered shares completed on August 22, 2014. | |||||
[3] | Represents the relative value of proceeds from issuance of Senior Secured Promissory Notes and related stock warrants for MILFAM II L.P. and AB Opportunity Fund LLC & AB Value Partners L.P, of $1,027,000 and $544,000 respectively, as of the issuance date. | |||||
[4] | Represents proceeds relating to exercising of warrants to purchase 1.1 million and .5 million shares of unregistered common stock on September 16, 2014 and October 14, 2014, respectively. |
Consolidated_Statements_of_Sto1
Consolidated Statements of Stockholders' Equity (Parenthetical) (USD $) | 1 Months Ended | 12 Months Ended | |
Jul. 31, 2012 | Dec. 29, 2014 | ||
Issuance costs related to sale of stock | $221,000 | ||
Issuance of stock warrants | 1,571,000 | [1] | |
Exercise of warrants to purchase common stock | 11,000 | [2] | |
MILFAM II LP [Member] | |||
Issuance of stock warrants | 1,027,000 | ||
AB Opportunity Fund LLC & AB Value Partners L.P. [Member] | |||
Issuance of stock warrants | $544,000 | ||
[1] | Represents the relative value of proceeds from issuance of Senior Secured Promissory Notes and related stock warrants for MILFAM II L.P. and AB Opportunity Fund LLC & AB Value Partners L.P, of $1,027,000 and $544,000 respectively, as of the issuance date. | ||
[2] | Represents proceeds relating to exercising of warrants to purchase 1.1 million and .5 million shares of unregistered common stock on September 16, 2014 and October 14, 2014, respectively. |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 29, 2014 | Dec. 30, 2013 | Dec. 31, 2012 |
Cash flows from operating activities: | |||
Net loss | ($16,625) | ($11,444) | ($4,441) |
Adjustments to reconcile net loss to net cash used in operating activities | |||
Depreciation and amortization | 2,394 | 2,724 | 3,613 |
Debt issuance amortization | 446 | 0 | 0 |
Gain on sale of assets | -50 | -34 | 0 |
Non-cash portion of asset impairments and disposals | 374 | 1,122 | 424 |
Provision for bad debts | 226 | 491 | 46 |
Lease termination reserve | -249 | -64 | -30 |
Stock-based compensation expense | 509 | 128 | 399 |
Interest expense paid in kind | 470 | 0 | 0 |
Changes in operating assets and liabilities: | |||
Accounts receivable | -213 | 600 | -683 |
Notes receivable | 0 | 36 | 175 |
Inventories | -46 | 115 | -176 |
Prepaid expenses and other current assets | 69 | 272 | -140 |
Other assets | 101 | -28 | 26 |
Accounts payable and accrued expenses | -888 | -771 | -1,319 |
Deferred franchise revenue | 206 | -35 | -175 |
Other liabilities | -671 | -406 | -674 |
Net cash used in operating activities | -13,947 | -7,294 | -2,955 |
Cash flows from investing activities: | |||
Capital expenditures | -1,880 | -2,142 | -1,409 |
Proceeds from sale of assets | 72 | 40 | 0 |
Net cash used in investing activities | -1,808 | -2,102 | -1,409 |
Cash flows from financing activities: | |||
Proceeds from issuance of long-term debt | 7,500 | 0 | 0 |
Proceeds from issuance of common stock | 24,473 | 0 | 12,780 |
Proceeds from the issuance of warrants | 11 | 0 | 0 |
Long-term debt issuance costs | -403 | 0 | 0 |
Common stock issuance costs | -287 | 0 | -221 |
Net cash provided by financing activities | 31,294 | 0 | 12,559 |
Net increase / (decrease) increase in cash and cash equivalents | 15,539 | -9,396 | 8,195 |
Cash and cash equivalents, beginning of year | 6,021 | 15,417 | 7,222 |
Cash and cash equivalents, end of year | 21,560 | 6,021 | 15,417 |
Cash paid for: | |||
Corporate franchise and income taxes | $376 | $138 | $154 |
Organization_and_Summary_of_Si
Organization and Summary of Significant Accounting Policies | 12 Months Ended | ||||||||||||||||||||
Dec. 29, 2014 | |||||||||||||||||||||
Organization and Summary of Significant Accounting Policies [Abstract] | |||||||||||||||||||||
Organization and Summary of Significant Accounting Policies | 1. Organization and Summary of Significant Accounting Policies | ||||||||||||||||||||
Organization | |||||||||||||||||||||
Cosi, Inc., a Delaware corporation, owns, operates, and franchises fast-casual dining restaurants which sell high-quality, made-to-order sandwiches, salads, bowls, and coffees, along with a variety of other soft drink beverages, teas, baked goods and alcoholic beverages. As of December 29, 2014, there were 64 Company-owned and 47 franchised restaurants operating in 16 states, the District of Columbia, the United Arab Emirates, and Costa Rica. | |||||||||||||||||||||
Fiscal Year | |||||||||||||||||||||
Our fiscal year ends on the Monday closest to December 31. Fiscal years ended December 29, 2014, December 30, 2013, December 31, 2012 are referred to as fiscal 2014, 2013, and 2012, respectively. Each of fiscal years 2014, 2013 and 2012 included 52 weeks | |||||||||||||||||||||
Basis of Presentation | |||||||||||||||||||||
The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and include the accounts of the Company and its wholly-owned subsidiaries. All inter-company accounts and transactions have been eliminated. | |||||||||||||||||||||
Cash and Cash Equivalents | |||||||||||||||||||||
We consider all short-term investments with a maturity of three months or less from the date of purchase to be cash equivalents. | |||||||||||||||||||||
Concentration of Credit Risks | |||||||||||||||||||||
Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash deposits. We place our cash deposits in Federal Deposit Insurance Corporation (“FDIC”) insured financial institutions. Balances of cash deposits may, at times, exceed FDIC insured limits. We have never experienced losses related to these balances. | |||||||||||||||||||||
Our accounts receivable consist principally of trade or “house” accounts representing corporate customers and amounts due from franchisees. We have established credit procedures and analyses to control the granting of credit to customers. Credit card transactions at the Company’s restaurants are processed by a single service provider. | |||||||||||||||||||||
Accounts Receivable | |||||||||||||||||||||
Trade accounts receivable are stated at net realizable value. The Company maintains a reserve for potential uncollectible accounts based on historical trends and known current factors impacting the Company’s customers or franchisees. | |||||||||||||||||||||
Inventories | |||||||||||||||||||||
Inventories are stated at the lower of cost, determined using a weighted average valuation method that approximates the first-in, first-out method, or market, and consist principally of food, beverage, liquor, packaging and related food supplies. | |||||||||||||||||||||
Furniture and Fixtures, Equipment and Leasehold Improvements | |||||||||||||||||||||
Furniture and fixtures, equipment and leasehold improvements are stated at cost. Depreciation of furniture and fixtures and equipment is computed using the straight-line method over estimated useful lives that range from two to ten years. Leasehold improvements are amortized using the straight-line method over the shorter of their estimated useful lives or the term of the related leases. | |||||||||||||||||||||
Upon retirement or sale, the cost of assets disposed of and their related accumulated depreciation are removed from the accounts. Any resulting gain or loss is credited or charged to operations. Maintenance and repairs are charged to expense when incurred, while betterments are capitalized. | |||||||||||||||||||||
Long-Lived Assets | |||||||||||||||||||||
Impairment losses are recorded on long -lived assets on a restaurant-by-restaurant basis whenever impairment factors are determined to be present. We consider a consistent history of poor financial operating performance to be the primary indicator of potential impairment for individual restaurant locations. We determine whether a restaurant location is impaired based on expected undiscounted cash flows, generally for the remainder of the original lease term, and then determine the impairment charge based on discounted cash flows for the same period. | |||||||||||||||||||||
In accordance with the provisions of the impairment or disposal subsections of ASC 360-10, Property, Plant & Equipment, long-lived assets held and used with a carrying amount of $2.2 million were written down to their fair value of $1.2 million, resulting in asset impairment and disposal charges of $1.0 million which were included in earnings for fiscal 2013. We did not record any impairment charges during fiscal 2014 but if stores do not reach their expected sales, impairment maybe a possibility in the near future. We considered all relevant valuation techniques that could be obtained without undue cost and effort, and concluded that the discounted cash flow approach continued to provide the most relevant and reliable means by which to determine fair value of the long-lived assets held and used. | |||||||||||||||||||||
Prices in Active | Significant | Significant | |||||||||||||||||||
Markets for | Observable | Unobservable | |||||||||||||||||||
Long-lived assets held | Total value at | Identical Assets | Inputs | Inputs | Total | ||||||||||||||||
and used | end of period | (Level 1) | (Level 2) | (Level 3) | (Losses) | ||||||||||||||||
(in thousands) | |||||||||||||||||||||
29-Dec-14 | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||
$ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||
30-Dec-13 | $ | 1,219 | $ | - | $ | - | $ | 1,219 | $ | (1,005 | ) | ||||||||||
$ | 1,219 | $ | - | $ | - | $ | 1,219 | $ | (1,005 | ) | |||||||||||
31-Dec-12 | $ | 348 | $ | - | $ | - | $ | 348 | $ | (424 | ) | ||||||||||
$ | 348 | $ | - | $ | - | $ | 348 | $ | (424 | ) | |||||||||||
The asset impairment charges relate to ten and four underperforming restaurants and for maintenance capital expenditures on previously impaired restaurants, in fiscal years 2013 and 2012, respectively. | |||||||||||||||||||||
Accounting for Lease Obligations | |||||||||||||||||||||
We recognize rent expense on a straight-line basis over the lease term commencing on the date we take possession. We record landlord allowances as deferred rent in other long-term liabilities on the consolidated balance sheets and amortize them on a straight-line basis over the term of the related lease. | |||||||||||||||||||||
Lease Termination Charges | |||||||||||||||||||||
Future store closings, if any, resulting from our decision to close underperforming locations prior to their scheduled lease expiration dates may result in additional lease termination charges. For all exit activities, we estimate our likely liability under contractual leases for restaurants that have been closed. Such estimates have affected the amount and timing of charges to operating results and are impacted by management’s judgments about the time it may take to find a suitable subtenant or assignee, or the terms under which a termination of the lease agreement may be negotiated with the landlord. We recognize costs associated with exit or disposal activities at the time a commitment to an exit or disposal plan is communicated to the landlord. | |||||||||||||||||||||
We incurred lease termination charges of approximately $1.5 million during fiscal 2014 related to the closing of 10 Company-owned restaurants. The lease termination charges that we recorded in fiscal years 2013 and 2012 were immaterial. | |||||||||||||||||||||
A summary of lease termination reserve activity is as follows: | |||||||||||||||||||||
(in thousands) | |||||||||||||||||||||
Balance as of January 2, 2012 | 245 | ||||||||||||||||||||
Charged to costs and expenses | 2 | ||||||||||||||||||||
Payments and adjustments | (33 | ) | |||||||||||||||||||
Balance as of December 31, 2012 | 214 | ||||||||||||||||||||
Charged to costs and expenses | 127 | ||||||||||||||||||||
Payments and adjustments | (191 | ) | |||||||||||||||||||
Balance as of December 30, 2013 | 150 | ||||||||||||||||||||
Charged to costs and expenses | 1,468 | ||||||||||||||||||||
Payments and adjustments | (1,218 | ) | |||||||||||||||||||
Balance as of December 29, 2014 | 400 | ||||||||||||||||||||
Other Liabilities | |||||||||||||||||||||
Other liabilities consist of deferred rent, landlord allowances and accrued lease termination costs (see Note 12 to our consolidated financial statements). | |||||||||||||||||||||
Income Taxes | |||||||||||||||||||||
We have recorded a full valuation allowance to reduce our deferred tax assets that relate primarily to net operating loss carryforwards. Our determination of the valuation allowance is based on an evaluation of whether it is more likely than not that we will be able to utilize the net operating loss carryforwards based on the Company’s operating results. A positive adjustment to income will be recorded in future years if we determine that we could realize these deferred tax assets. | |||||||||||||||||||||
As of December 29, 2014, we had net operating loss (“NOL”) carryforwards of approximately $243 million for U.S. federal income tax purposes. Under the Internal Revenue Code, an “ownership change” with respect to a corporation can significantly limit the amount of pre-ownership change NOLs and certain other tax assets that the corporation may utilize after the ownership change to offset future taxable income. An ownership change generally would occur if the aggregate stock ownership of holders of at least 5% of our stock increases by more than 50 percentage points over the preceding three-year period. We do not believe that the December 23, 2014, July 9, 2012, and the previously disclosed January 6, 2010, rights offerings and the related private placements of common stock triggered an ownership change which would generally occur if the aggregate stock ownership of holders of at least 5% of our stock increases by more than 50 percentage points over the preceding three-year period. In addition, a limitation would not have an impact on our consolidated financial statements as we have recorded a valuation allowance for the entire amount of our deferred tax assets. | |||||||||||||||||||||
We adopted ASC 740-10, Income Taxes, which prescribes a comprehensive financial statement model of how a company should recognize, measure, present and disclose uncertain tax positions that the company has taken or expects to take in its income tax returns. The standard requires that only income tax benefits that meet the “more likely than not” recognition threshold be recognized or continue to be recognized on the effective date. Initial recognition amounts would have been reported as a cumulative effect of a change in accounting principle. | |||||||||||||||||||||
Should the Company need to accrue interest or penalties on uncertain tax positions, it would recognize the interest as interest expense and the penalties as a general and administrative expense. | |||||||||||||||||||||
Due to our unexpired NOLs, Cosi could be subject to IRS income tax examination for the tax year 1996 and all subsequent years. We could also be subject to state income tax examinations in certain states where we have unexpired NOLs. | |||||||||||||||||||||
Revenue Recognition | |||||||||||||||||||||
Restaurant Net Sales. Our Company-owned restaurant sales are composed almost entirely of food and beverage sales. We record revenue at the time of the purchase of our products by our customers. | |||||||||||||||||||||
Franchise Fees and Royalties. Franchise fees and royalties includes fees earned from franchise agreements entered into with area developers and franchise operators, as well as royalties received based on sales generated at franchised restaurants. We recognize the franchise fee in the period in which a franchise location opens or when fees are forfeited as a result of a termination of an area development agreement. We recognize franchise royalties in the period in which sales are made by our franchise operators. | |||||||||||||||||||||
Gift Card Sales. We offer our customers the opportunity to purchase gift cards at our restaurants and through our website. Customers can purchase these cards at varying dollar amounts. At the time of purchase by the customer, we record a gift card liability for the face value of the card purchased. We recognize the revenue and reduce the gift card liability when the gift card is redeemed. We do not reduce our recorded liability for potential non-use of purchased gift cards. | |||||||||||||||||||||
Gain on Sale of Assets | |||||||||||||||||||||
The gain from the sale of one liquor license that we recognized during each of fiscal 2014 and 2013 was immaterial. There was no gain in fiscal 2012. | |||||||||||||||||||||
Restaurant Pre-opening Expenses | |||||||||||||||||||||
Restaurant pre-opening expenses are expensed as incurred and include the costs of recruiting, hiring and training the initial restaurant work force, travel, the cost of food and labor used during the period before opening, the cost of initial quantities of supplies and other direct costs related to the opening or remodeling of a restaurant. Pre-opening expenses also include rent expense recognized on a straight-line basis from the date we take possession through the period of construction or renovation prior to opening the restaurant. The restaurant pre-opening expenses that we incurred during fiscal 2014 and 2013 related to the opening of one new restaurant in Chicago, Illinois, and to the relocation of one Company-owned restaurant in Ohio, respectively both which were immaterial. | |||||||||||||||||||||
Advertising Costs | |||||||||||||||||||||
Domestic franchise-operated Cosi® restaurants contribute 1% of their sales to a national marketing fund and are also required to spend 1% of their sales on advertising in their local markets. Our international franchise-operated restaurants contribute 0.5% of their sales to an international marketing fund. The Company also contributes 1% of sales from Company-owned restaurants to the national marketing fund. The Company’s contributions, as well as its own local market media costs, are recorded as part of occupancy and other restaurant operating expenses on the Company’s consolidated statements of operations. Advertising costs are expensed as incurred and were approximately $1.0 million, $0.9 million, and $1.2 million in fiscal years 2014, 2013, and 2012, respectively. | |||||||||||||||||||||
Net Loss Per Share | |||||||||||||||||||||
Basic and diluted loss per common share is calculated by dividing the net loss by the weighted-average common shares outstanding during each period. As of December 29, 2014, December 30, 2013, and December 31, 2012, there were, respectively, 1,175,064 unvested restricted shares, 11,325 unvested restricted shares and 271,400 unvested restricted shares of common stock outstanding, and 3,750 out-of the money, 53,514 out-of the money and 38,552 out-of-the-money stock options to purchase shares of common stock. There were no in-the-money stock options as of the end of fiscal years 2014, 2013, and 2012. The unvested restricted shares and the out-of-the-money stock options meet the requirements for participating securities but were not included in the computation of basic and diluted earnings per share because we incurred a net loss in all periods presented and, hence, the impact would be anti-dilutive. | |||||||||||||||||||||
Stock-Based Compensation | |||||||||||||||||||||
In accordance with ASC 718-10-25, Compensation – Stock Compensation, we recognize stock-based compensation expense according to the fair value recognition provision which generally requires, among other things, that all employee share-based compensation is measured using a fair value method and that all the resulting compensation expense is recognized in the financial statements. In accordance with the standard, our stock-based compensation expense is recognized on a straight-line basis over the requisite service period of the award, which is the vesting term. As a result, we recognized stock compensation expense of approximately $0.5 million, $0.1 million, and $0.4 million during fiscal years 2014, 2013, and 2012, respectively. We measure the estimated fair value of our granted stock options using a Black-Scholes pricing model and of our restricted stock based on the fair market value of a share of registered stock on the date of the grant. | |||||||||||||||||||||
Segment Information | |||||||||||||||||||||
Operating segments are defined as components of an enterprise about which separate financial information is available and is evaluated regularly by the chief operating decision maker in deciding how to allocate resources in assessing performance. Our chief operating decision maker reviews one aggregated set of financial statements to make decisions about resource allocations and to assess performance. Consequently, we have one reportable segment for all sales generated. | |||||||||||||||||||||
Accounting Estimates | |||||||||||||||||||||
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results may differ from those estimates. |
Accounts_Receivable
Accounts Receivable | 12 Months Ended | ||||||||
Dec. 29, 2014 | |||||||||
Accounts Receivable [Abstract] | |||||||||
Accounts Receivable | 2. Accounts Receivable | ||||||||
Accounts receivable consist of the following: | |||||||||
December 29, | December 30, | ||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Accounts receivable, trade | $ | 408 | $ | 342 | |||||
Due from franchisees | 190 | 473 | |||||||
Other | 101 | 123 | |||||||
Total receivables | 699 | 938 | |||||||
Less: allowance for doubtful accounts | (118 | )(1) | (344 | )(1) | |||||
Accounts receivable, net | $ | 581 | $ | 594 | |||||
(1) Does not include approximately $0.5 million in reserve on a note receivable from a franchisee presented in Note 5. Notes Receivable | |||||||||
A summary of the reserve for doubtful accounts follows: | |||||||||
(in thousands) | |||||||||
Balance as of January 2, 2012 | 254 | ||||||||
Charged to costs and expenses | 46 | ||||||||
Deductions | 3 | (a) | |||||||
Balance as of December 31, 2012 | 303 | ||||||||
Charged to costs and expenses | 491 | (b) | |||||||
Deductions | - | (a) | |||||||
Balance as of December 30, 2013 | 794 | ||||||||
Charged to costs and expenses | - | ||||||||
Deductions | 226 | (a) | |||||||
Balance as of December 29, 2014 | 568 | ||||||||
(a) | Recovery (write-off) of uncollectible accounts | ||||||||
(b) | Includes approximately $0.5 million reserve on a note receivable from a franchisee |
Prepaid_Expenses_and_Other_Cur
Prepaid Expenses and Other Current Assets | 12 Months Ended | ||||||||
Dec. 29, 2014 | |||||||||
Prepaid Expenses and Other Current Assets [Abstract] | |||||||||
Prepaid Expenses and Other Current Assets | 3. Prepaid Expenses and Other Current Assets | ||||||||
Prepaid expenses and other current assets consist of the following: | |||||||||
December 29, | December 30, | ||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Prepaid insurance | $ | 1,208 | $ | 1,263 | |||||
Other | 71 | 85 | |||||||
Prepaid expenses and other current assets | $ | 1,279 | $ | 1,348 |
Furniture_and_Fixtures_Equipme
Furniture and Fixtures, Equipment and Leasehold Improvements | 12 Months Ended | ||||||||
Dec. 29, 2014 | |||||||||
Furniture and Fixtures, Equipment and Leasehold Improvements [Abstract] | |||||||||
Furniture and Fixtures, Equipment and Leasehold Improvements | 4. Furniture and Fixtures, Equipment and Leasehold Improvements | ||||||||
Furniture and fixtures, equipment and leasehold improvements consist of the following: | |||||||||
December 29, | December 30, | ||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Leasehold improvements | $ | 29,481 | $ | 31,361 | |||||
Furniture and fixtures | 9,110 | 10,325 | |||||||
Computer and telephone equipment | 11,231 | 11,492 | |||||||
Restaurant equipment | 14,957 | 16,228 | |||||||
Vehicles | 39 | 39 | |||||||
Total furniture and fixtures, equipment and leasehold improvements | 64,818 | 69,445 | |||||||
Less accumulated depreciation and amortization | (57,510 | ) | (61,250 | ) | |||||
Furniture and fixtures, equipment and leasehold improvements, net | $ | 7,308 | $ | 8,195 | |||||
Depreciation and amortization expense for fiscal years 2014, 2013, and 2012 was approximately $2.4 million, $2.7 million, and $3.6 million, respectively. |
Notes_Receivable
Notes Receivable | 12 Months Ended | ||||||||
Dec. 29, 2014 | |||||||||
Notes Receivable [Abstract] | |||||||||
Notes Receivable | 5. Notes Receivable | ||||||||
December 29, | December 30, | ||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Sale of restaurant to a franchisee in 2010 | 925 | 925 | |||||||
Other | 76 | 76 | |||||||
Total notes receivable | 1,001 | 1,001 | |||||||
Less: allowance for doubtful accounts | (450 | )(1) | (450 | )(1) | |||||
Total notes receivable | $ | 551 | $ | 551 | |||||
(1) Denotes a reserve on a note receivable f rom a franchisee included in the summary of the reserve for doubtful accounts in Note 1. Accounts Receivable. |
Other_Assets
Other Assets | 12 Months Ended | ||||||||
Dec. 29, 2014 | |||||||||
Other Assets [Abstract] | |||||||||
Other Assets | 6. Other Assets | ||||||||
Other assets consist of the following: | |||||||||
December 29, | December 30, | ||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Security deposits | 721 | 788 | |||||||
Deferred financing costs | 312 | - | |||||||
Trademarks | 195 | 195 | |||||||
Liquor licenses | 85 | 85 | |||||||
Other | 14 | 47 | |||||||
Total other assets | $ | 1,327 | $ | 1,115 |
Accrued_Expenses
Accrued Expenses | 12 Months Ended | ||||||||
Dec. 29, 2014 | |||||||||
Accrued Expenses [Abstract] | |||||||||
Accrued Expenses | 7. Accrued Expenses | ||||||||
Accrued expenses consist of the following: | |||||||||
December 29, | December 30, | ||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Payroll and related benefits and taxes | $ | 1,932 | $ | 2,143 | |||||
Unredeemed gift cards/certificates | 2,032 | 2,067 | |||||||
Insurance | 1,229 | 1,327 | |||||||
Utilities | 613 | 857 | |||||||
Rent | 523 | 516 | |||||||
Professional and legal | 376 | 497 | |||||||
Construction costs | 293 | - | |||||||
Taxes other than income taxes | 274 | 383 | |||||||
Deferred credits | 278 | 323 | |||||||
Rights offering professional fees | 265 | - | |||||||
Advertising | 95 | 103 | |||||||
Other | 1,426 | 872 | |||||||
Total accrued expenses | $ | 9,336 | $ | 9,088 |
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||||||
Dec. 29, 2014 | |||||||||||||
Income Taxes [Abstract] | |||||||||||||
Income Taxes | 8. Income Taxes | ||||||||||||
Significant components of our deferred tax assets, net of any deferred tax liabilities, are as follows: | |||||||||||||
December 29, | December 30, | ||||||||||||
2014 | 2013 | ||||||||||||
(in thousands) | |||||||||||||
Deferred tax assets: | |||||||||||||
Net operating loss carryforward | $ | 96,350 | $ | 89,488 | |||||||||
Depreciation expense and impairment of long-lived assets | 13,747 | 14,215 | |||||||||||
Contractual lease increases and other | 529 | 851 | |||||||||||
Deferred franchise revenue | 1,203 | 1,244 | |||||||||||
Stock-based compensation | 1,293 | 1,161 | |||||||||||
Lease termination accrual | 158 | 60 | |||||||||||
Allowance for doubtful accounts | 462 | 315 | |||||||||||
Total deferred tax assets | 113,742 | 107,334 | |||||||||||
Valuation allowance | (113,742 | ) | (107,334 | ) | |||||||||
Net deferred taxes | $ | - | $ | - | |||||||||
As of December 29, 2014, we have federal net operating tax loss carryforwards (NOL’s) of approximately $243 million which, if not used, will expire from 2018 through 2034. We have recorded a valuation allowance to offset the benefit associated with the deferred tax assets described above due to the uncertainty of realizing the related benefits. | |||||||||||||
Below is a reconciliation of the statutory federal income tax rate to the effective tax rate as a percentage of income before income taxes: | |||||||||||||
December 29, | December 30, | December 31, | |||||||||||
2014 | 2013 | 2012 | |||||||||||
Statutory federal income tax rate | 35 | % | 35 | % | 35 | % | |||||||
State income taxes | 4.6 | 4.6 | 4.6 | ||||||||||
39.6 | 39.6 | 39.6 | |||||||||||
Less valuation allowance | (39.6 | ) | (39.6 | ) | (39.6 | ) | |||||||
Effective Tax Rate | 0 | % | 0 | % | 0 | % | |||||||
Under the Internal Revenue Code, an “ownership change” with respect to a corporation can significantly limit the amount of pre-ownership change NOLs and certain other tax assets that the corporation may utilize after the ownership change to offset future taxable income. An ownership change generally would occur if the aggregate stock ownership of holders of at least 5% of our stock increases by more than 50 percentage points over the preceding three-year period. We do not believe that the purchase of shares of our common stock pursuant to the rights offering, senior secured promissory notes, private placements or conversion of $0.01 warrants for shares of our common stock completed in fiscal 2014, have triggered an ownership change. In addition, a limitation would not have an impact on our consolidated financial statements as we have recorded a valuation allowance for the entire amount of our deferred tax assets. |
Stockholders_Equity
Stockholders' Equity | 12 Months Ended | ||||
Dec. 29, 2014 | |||||
Stockholders' Equity [Abstract] | |||||
Stockholders' Equity | 9. Stockholders’ Equity | ||||
Rights Offering and Private Placement of Common Stock | |||||
On December 23, 2014, we completed a shareholders’ rights offering to our shareholders of record as of October 31, 2014. We issued a total of 13,333,329 shares of our common stock, $0.01 par value per share, at a subscription price of $1.50 per share. We received net proceeds of approximately $19.7 million from the rights offering of common stock. | |||||
On July 9, 2012, we completed a shareholders’ rights offering to our shareholders of record as of May 24, 2012. We issued a total of 4,915,461 shares of our common stock, $0.01 par value per share, at a subscription price of $2.60 per share. Of those shares, our executive officers and outside directors purchased an aggregate of 633,581 shares of our common stock, $0.01 par value per share, at a subscription price of $2.60 per share, through private placements, based on the number of shares that would have been available to them had they executed their basic and oversubscription privilege in the rights offering. We received net proceeds of approximately $12.6 million from the rights offering and the private placements of common stock. | |||||
We do not believe that the December 23, 2014, July 9, 2012, and the previously disclosed January 6, 2010, rights offerings and the related private placements of common stock triggered an ownership change which would generally occur if the aggregate stock ownership of holders of at least 5% of our stock increases by more than 50 percentage points over the preceding three-year period. | |||||
Under the Internal Revenue Code, an “ownership change” with respect to a corporation can significantly limit the amount of pre-ownership change NOLs and certain other tax assets that the corporation may utilize after the ownership change to offset future taxable income. | |||||
Stock Purchase Agreement | |||||
On August 22, 2014, the Company sold 3,367,874 unregistered shares of the Company’s common stock, par value of $0.01 per share, at a purchase price of $1.15 per share to Plaisance Fund, LP, a fund managed by Janus Capital Management LLC, for gross proceeds of $3,873,055, and concurrently therewith sold 521,739 unregistered shares of the Company’s common stock, par value of $0.01 per share, at a purchase price of $1.15 per share, to Lloyd I. Miller Trust C for gross proceeds of $600,000. | |||||
Senior Secured Promissory Notes | |||||
On April 14, 2014, the Company entered into a $5.0 million Senior Secured Promissory Note Agreement with MILFAM II, L.P. (the “MILFAM NOTE” and the “MILFAM Purchase Agreement”, respectively). The MILFAM Note bears interest at nine (9%) per annum, compounded semi-annually, and payable in arrears on a semi-annual basis. At the Company’s option, the first two semi-annual interest payments may be paid at eleven (11%) in kind in the form of additional Notes. The principal obligations under the MILFAM Note are due three (3) years from the effective date of the MILFAM Note. The MILFAM Note Agreement provides for the payment of a finance fee of 3.5% of the principal amount of the MILFAM Note at closing as well as providing a warrant exercisable to purchase up to 1.1 million shares of the Company’s common stock at an exercise price per share of $ 0.01. The warrant would not be exercisable to the extent that doing so resulted in MILFAM II L.P. and any related parties, in the aggregate, owning more than 19.9% of the Company’s common stock. Further, until all the obligations under the MILFAM Note are paid in full, MILFAM II, L.P. will have the right to participate in any future financing transactions consummated by the Company in an amount up to the greater of (1) the then-outstanding balance of obligations under the MILFAM Note and (2) $4.0 million. The MILFAM Note is guaranteed by the Company’s subsidiaries and secured by a lien on all assets of the Company and its subsidiaries [(excluding the assets of Hearthstone Associates, LLC and Hearthstone Partners, LLC)]. Mr. Lloyd I. Miller, III, is the manager of MILFAM LLC, the general partner of MILFAM II, L.P. Mr. Miller is a significant shareholder of the Company. | |||||
On September 16, 2014, 1.1 million of the warrants provided under the MILFAM Note Agreement were exercised in order to purchase 1.1 million unregistered shares of the Company’s common stock at an exercise price of $0.01 per share, resulting in an aggregate purchase price of $11,000. The stock warrants were carried at a fair value as of the issuance date of approximately $1.3 million based on the Black-Scholes model using the following assumptions: | |||||
Expected life (in years) | 3 | ||||
Volatility | 63.86 | % | |||
Risk Free interest rate | 0.82 | % | |||
Dividend yield (on common stock) | 0 | ||||
As of the issuance date, the relative value of the warrants was $1.0 million, which was the amount recorded as debt discount, with an offset to additional paid-in capital. The debt discount will be amortized over the life of the MILFAM Note, three years, and charged to interest expense using the effective interest rate calculation method. During Fiscal 2014, we chose the PIK option on the first interest payment which was due on October 14, 2014. | |||||
On May 20, 2014, the Company entered into a $2.5 million Senior Secured Note Purchase Agreement with AB Opportunity Fund LLC and AB Value Partners, L.P. (the “AB Notes”, the “AB Note Agreement”, and the “AB Entities”, respectively). The AB Notes are payable in full on the third anniversary from the effective date of the AB Notes. Interest will accrue at the rate of nine percent (9%), compounded semi-annually, and will be paid in arrears semi-annually, provided that the Company, at its option, may elect to pay the first two semi-annual interest payments at a rate of eleven percent (11%) in kind in the form of additional promissory notes. As consideration for the AB Notes, the Company provided a fee of 3.5% of the principal amount of the AB Notes and warrants exercisable to purchase up to an aggregate, initially, of 550,000 shares of the common stock of the Company at an exercise price per share of $0.01, provided that the AB Entities would not be permitted to exercise the warrants to the extent such exercise would result in any of the AB Entities and any of their affiliates owning, in the aggregate more than 19.9% of the common stock of the Company. The warrants were exercisable by the AB Entities at any time prior to the third anniversary from the effective date of the AB Notes, in whole or in part, by surrendering the warrants and a form of exercise to the Company. | |||||
On October 14, 2014, 550,000 of the warrants provided under the AB Note Purchase Agreement were exercised by the cashless exercise method by forfeiting 2,895 shares to pay for the warrants in lieu of cash. The Company’s 550,000 stock warrants were carried at their fair value as of the issuance date of approximately $0.7 million based on the Black-Scholes model using the following assumptions: | |||||
Expected life (in years) | 3 | ||||
Volatility | 63.86 | % | |||
Risk Free interest rate | 0.82 | % | |||
Dividend yield (on common stock) | 0 | ||||
As of the issuance date, the relative value of the warrants was $0.5 million, which was the amount recorded as debt discount, with an offset to additional paid-in capital. The debt discount will be amortized over the life of the AB Notes, three years, and charged to interest expense using the effective interest rate calculation method. During Fiscal 2014, we chose the PIK option on the first interest payment which was due on December 20, 2014. | |||||
We incurred approximately $0.5 million of debt issuance costs in connection with the issuance of both senior secured promissory notes issued during FY 2014 and are in compliance with all covenant requirements under the MILFAM and AB Note Agreements. | |||||
Reverse Common Stock Split | |||||
On May 8, 2013, the Company filed a Certificate of Amendment to its Amended and Restated Certificate of Incorporation to implement a one-for-four reverse split of its common stock, par value $0.01 per share, as approved by the Company’s stockholders at the Annual Meeting of Stockholders on May 8, 2013. The reverse split was effective as of 8:00 a.m. (Eastern Time) on May 9, 2013, and the Company’s common stock began trading on the NASDAQ Global Market on a post-split basis on May 9, 2013. All share amounts presented in these financial statements have been retroactively adjusted to reflect this split. |
StockBased_Employee_Compensati
Stock-Based Employee Compensation | 12 Months Ended | ||||||||||||||||||||||
Dec. 29, 2014 | |||||||||||||||||||||||
Stock-Based Employee Compensation [Abstract] | |||||||||||||||||||||||
Stock-Based Employee Compensation | 10. Stock-Based Employee Compensation | ||||||||||||||||||||||
The Company has several long -term incentive compensation plans, including the Amended and Restated Cosi, Inc. Long-Term Incentive Plan, which provided for the granting of incentive and nonqualified stock options to employees. On May 2, 2005, the Cosi, Inc. 2005 Omnibus Long-Term Incentive Plan (the “Omnibus Plan”) went into effect, superseding all prior long-term incentive plans. The Omnibus Plan provides for the issuance of restricted stock, restricted stock units, incentive and nonqualified stock options, and any other stock awards that may be payable in shares, cash, other securities, and any other form of property as may be determined by the Compensation Committee of our Board of Directors. The purpose of this plan is to attract and retain qualified individuals and to align their interest with those of stockholders by providing certain employees of Cosi, Inc. and its affiliates with the opportunity to receive stock-based and other long-term incentive grants. The terms and conditions of stock-based awards under the plans are determined by the Compensation Committee of the Board of Directors. The grants are issued at fair market value and generally vest over a period of four or five years. We currently account for stock option grants in accordance with ASC 718-10-25 Compensation – Stock Compensation. | |||||||||||||||||||||||
When the Omnibus Plan went into effect, 925,000 authorized but unissued common shares that were reserved under the Amended and Restated Cosi, Inc. Long Term Incentive Plan continued to be reserved for issuance under the Omnibus Plan. No additional awards will be granted under any of the prior long-term incentive plans. During fiscal 2012, an Amendment to the Omnibus Plan was approved which increased the number of shares available for issuance under the Plan by 375,000. During fiscal 2014, the plan was amended and restated by the “Amended & Restated Cosi, Inc. 2005 Omnibus Long-Term Incentive Plan” (“Amended and Restated Omnibus Plan”) which increased the number of shares available for issuance by 1,500,000 shares and extends the term for a period of 10 years. | |||||||||||||||||||||||
As of December 29, 2014, approximately 1.6 million shares of common stock, in the aggregate, were reserved for issuance under the Amended & Restated Omnibus Plan and for outstanding grants under the prior long-term incentive plans. Additionally during fiscal 2014 the company issued 1.4 million restricted shares to employees, including 1 million unregistered shares under an exception to registration as a material inducement for such employees to accept employment with the Company and .4 million shares under the Amended & Restated Omnibus Plan. | |||||||||||||||||||||||
A summary of stock-based compensation follows: | |||||||||||||||||||||||
Fiscal Year | |||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Stock option compensation expense | $ | - | $ | 7 | $ | - | |||||||||||||||||
Restricted stock compensation expense, net of forfeitures | 509 | 121 | 399 | ||||||||||||||||||||
Total non-cash, stock-based compensation expense, net of forfeitures | $ | 509 | $ | 128 | $ | 399 | |||||||||||||||||
As of December 29, 2014, the unrecognized compensation expense related to restricted stock shares and stock options granted under the Omnibus Plan was $1.0 million. The expense will be recognized on a straight-line basis from the date of each grant through fiscal 2018 and is recorded in general and administrative expenses in our consolidated statements of operations. | |||||||||||||||||||||||
A summary of option activity for fiscal years 2014, 2013, and 2012 follows: | |||||||||||||||||||||||
Weighted | |||||||||||||||||||||||
Weighted | Average | Aggregate | |||||||||||||||||||||
Number of | Average Exercise | Remaining | Intrinsic | ||||||||||||||||||||
Options | Price | Contractual Term | Value | ||||||||||||||||||||
(in years) | (in thousands) | ||||||||||||||||||||||
Outstanding as of January 2, 2012 | 41,071 | $ | 20 | 2.5 | $ | - | |||||||||||||||||
Granted | - | - | |||||||||||||||||||||
Exercised | - | - | |||||||||||||||||||||
Cancelled/Expired | (2,518 | ) | $ | 13.88 | - | ||||||||||||||||||
Outstanding as of December 31, 2012 | 38,553 | $ | 20.4 | 1.7 | $ | - | |||||||||||||||||
Granted | 25,000 | 2.8 | |||||||||||||||||||||
Exercised | - | - | |||||||||||||||||||||
Cancelled/Expired | (10,038 | ) | $ | 21.02 | - | ||||||||||||||||||
Outstanding as of December 30, 2013 | 53,515 | $ | 12.05 | 3.9 | $ | - | |||||||||||||||||
Granted | - | - | |||||||||||||||||||||
Exercised | - | - | |||||||||||||||||||||
Cancelled/Expired | (47,052 | ) | $ | 28.83 | - | ||||||||||||||||||
Outstanding as of December 29, 2014 | 6,463 | $ | 3.62 | 2.2 | $ | - | |||||||||||||||||
Exercisable as of December 29, 2014 | 3,750 | $ | 2.8 | 2.2 | $ | - | |||||||||||||||||
There were 6,463 outstanding, out-of-the-money stock options as of the end of fiscal 2014. We granted 25,000 stock options during fiscal 2013 with a fair value of $0.07 million. No stock options were exercised during any of the fiscal years presented As of the end of fiscal 2014, the outstanding stock options had no intrinsic value as they were all out-of-the-money. | |||||||||||||||||||||||
The following table summarizes information about stock options outstanding at December 29, 2014: | |||||||||||||||||||||||
Options | Contractual | Exercise | Options | Exercise | |||||||||||||||||||
Range of Exercise Prices | Outstanding | Life in Years | Price | Exercisable | Price | ||||||||||||||||||
$ | 2.80 - $27.76 | 6,463 | 2.2 | $ | 3.62 | 3,750 | $ | 2.8 | |||||||||||||||
Pursuant to the Amended and Restated Omnibus Plan or the exception to registration as a material inducement and in accordance with the terms and conditions prescribed by the Compensation Committee of our Board of Directors, we granted a total of 1,512,745 of time-vested and performance based shares of restricted stock in fiscal 2014, 974,164 unregistered shares under an exception to registration as a material inducement to new employees to accept employment with the company and 536,601 shares under the Amended & Restated Omnibus Plan. During fiscal 2013, we granted 30,000 shares of restricted stock to employees and converted 91,250 previously issued restricted stock units into restricted stock shares. We did not grant any shares of restricted stock to employees in fiscal 2012 | |||||||||||||||||||||||
For the shares issued in fiscal 2014, 50% of each grant vests over time (“Time- Vested Shares”) and 50% of each grant vests upon achievement of certain stock price targets (“Performance-Based Shares”), subject to the following vesting schedules: | |||||||||||||||||||||||
(a) | The Time-Vested Shares will vest in four equal installments, with 25% vesting on each of the first, second, third and fourth anniversaries of the Date of Award, provided that the grantee remains in the continuous employ of the Company through each such vesting date. | ||||||||||||||||||||||
(b) | The Performance-Based Shares will vest in four equal installments, provided that the grantee remains in the continuous employment of the Company from and after the Date of Award and through the respective vesting dates set forth below and the specified price targets set forth below for the Company’s common stock are achieved: | ||||||||||||||||||||||
i. | 25% on the first day on which the closing price of the Company’s common stock shall have exceeded $2.00 for 30 consecutive trading days (as adjusted for stock splits, recapitalizations, reorganizations or similar events); | ||||||||||||||||||||||
ii. | 25% on the first day on which the closing price of the Company’s common stock shall have exceeded $2.50 for 30 consecutive trading days (as adjusted for stock splits, recapitalizations, reorganizations or similar events); | ||||||||||||||||||||||
iii. | 25% on the first day on which the closing price of the Company’s common stock shall have exceeded $3.00 for 30 consecutive trading days (as adjusted for stock splits, recapitalizations, reorganizations or similar events); and | ||||||||||||||||||||||
iv. | 25% on the first day on which the closing price of the Company’s common stock shall have exceeded $4.00 for 30 consecutive trading days (as adjusted for stock splits, recapitalizations, reorganizations or similar events). | ||||||||||||||||||||||
v. | In addition, in the event the holders of the Company’s common stock receive consideration in any change in control with a value at the time of receipt or subsequent to such receipt equal (on a per share basis and on an adjusted basis if applicable) to any of the applicable value thresholds set forth above, in respect of Company securities or any successor securities, then upon such receipt all Performance-Based Shares that would have become vested shares upon attainment of trading prices at or below such threshold or thresholds as provided above shall become vested shares. | ||||||||||||||||||||||
The value of the shares and the stock units for the grants made during fiscal years 2014 and 2013, based on the closing price of our common stock on the date of the grants, was approximately $1.4 million and $0.1 million, respectively. | |||||||||||||||||||||||
During fiscal years 2014, 2013, and 2012, previously issued shares and units of restricted common stock of 79,575, 256,725, and 13,463, respectively, were forfeited. The value of the forfeited shares and units of restricted common stock, based on the closing price of our common stock on the dates of the grants, was approximately $.8 million, $0.7 million, $0.05 million, in fiscal years 2014, 2013, and 2012 respectively. | |||||||||||||||||||||||
Included in the restricted stock activity table below are 76,601, 55,512, and 43,103 shares issued during fiscal years 2014, 2013, and 2012 respectively, to members of the Board of Directors pursuant to the Cosi Non-Employee Director Stock Incentive Plan and the Omnibus Plan. These shares had an aggregate value of approximately $0.1 million at the time of issuance in all three fiscal years and were fully vested upon issuance. | |||||||||||||||||||||||
The following tables summarize the Company’s restricted stock activity: | |||||||||||||||||||||||
Number of | Weighted | ||||||||||||||||||||||
Shares of | Average | ||||||||||||||||||||||
Restricted | Grant-Date | ||||||||||||||||||||||
Stock | Fair Value | ||||||||||||||||||||||
Non-vested at January 2, 2012 | 322,100 | $ | 3.08 | ||||||||||||||||||||
Granted | 43,103 | 3.48 | |||||||||||||||||||||
Vested | 80,340 | 3.56 | |||||||||||||||||||||
Forfeited / Canceled | (13,463 | ) | 4.68 | ||||||||||||||||||||
Non-vested at December 31, 2012 | 271,400 | $ | 2.96 | ||||||||||||||||||||
Granted | 85,512 | 2.91 | |||||||||||||||||||||
Vested | 88,862 | 3 | |||||||||||||||||||||
Forfeited / Canceled | (256,725 | ) | 2.88 | ||||||||||||||||||||
Non-vested at December 30, 2013 | 11,325 | $ | 4.08 | ||||||||||||||||||||
Granted | 1,510,765 | 0.92 | |||||||||||||||||||||
Vested | 125,000 | 0.99 | |||||||||||||||||||||
Forfeited / Canceled | (79,575 | ) | 1.1 | ||||||||||||||||||||
Non-vested at December 29, 2014 | 1,317,515 | $ | 0.95 |
Defined_Contribution_Plan
Defined Contribution Plan | 12 Months Ended |
Dec. 29, 2014 | |
Defined Contribution Plan [Abstract] | |
Defined Contribution Plan | 11. Defined Contribution Plan |
We have a 401(k) Plan (the “Plan”) for all qualified employees. In fiscal 2014, as part of various cost containment initiatives, the Company suspended the employer matching contribution to the Plan. In fiscal 2013 and 2012 the Plan provided for a matching employer contribution of 50% up to the first 4% of the employees’ deferred savings. The employer contributions made during the employee’s first year of employment vest upon the completion of one year of employment. Employer contributions made subsequent to the first year of employment vest immediately. The deferred amount cannot exceed 20% of an individual participant’s compensation in any calendar year. Our contributions to the Plan were approximately $.1 million in each of the fiscal years 2013 and 2012. |
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | ||||
Dec. 29, 2014 | |||||
Commitments and Contingencies [Abstract] | |||||
Commitments and Contingencies | 12. Commitments and Contingencies | ||||
Commitments | |||||
As of December 30, 2014, we are committed under lease agreements expiring through 2024 for occupancy of our retail restaurants and for office space at the following minimum annual rentals: | |||||
Fiscal Year | Amount | ||||
(in thousands) | |||||
2015 | 10,777 | ||||
2016 | 8,626 | ||||
2017 | 5,956 | ||||
2018 | 4,521 | ||||
2019 | 3,861 | ||||
Thereafter | 18,359 | ||||
$ | 52,100 | ||||
Amounts shown are net of approximately $0.1 million of sublease rental income under non-cancelable subleases. Rental expense for fiscal years 2014, 2013, and 2012, totaled $11.6, $12.6, $ 13.1 million, respectively. Certain lease agreements have renewal options ranging from 3 years to 5 years. In addition, certain leases obligate us to pay additional rent if restaurant sales reach certain minimum levels (percentage rent). Amounts incurred under these additional rent provisions and agreements were approximately $0.2 million in each of the fiscal years 2014, 2013, and 2012. | |||||
Certain of our lease agreements provide for scheduled rent increases during the lease term or for rental payments to commence at a date other than the date of initial occupancy. Rent expense is recognized on a straight-line basis over the term of the respective leases from the date we take possession. Our obligation with respect to these scheduled rent increases has been presented as a long-term liability in other liabilities in the accompanying consolidated balance sheets and totaled $1.1 million, $1.7 million, and $2.1 million, as of the end of fiscal years 2014, 2013, and 2012, respectively. | |||||
Certain of our leases also provide for landlord contributions to offset a portion of the cost of our leasehold improvements. These allowances are recorded as deferred liabilities and amortized on a straight-line basis as a reduction to rent expense over the term of the related leases. Included in other long-term liabilities in the accompanying consolidated balance sheets for fiscal years 2014, 2013, and 2012, were landlord allowances of $0.1 million, $0.2 million, and $0.5 million, respectively. | |||||
As of December 29, 2014, the Company had outstanding approximately $.2 million in standby letters of credit, which were provided as security deposits for certain of the lease obligations. The letters of credit are fully secured by cash deposits or marketable securities held in accounts at the issuing banks and are not available for withdrawal by the Company. These amounts are included as a component of “Other Assets” in the accompanying consolidated balance sheets. | |||||
As of December 29, 2014, future minimum lease payments related to restaurants that have been closed or locations with subleased spaces are approximately $0.3 million, before expected sublease payments, with remaining lease terms ranging from one to three years. For each of these locations, a lease termination reserve has been established based upon management’s estimate of the cost to exit the lease or the time it would take to enter into a new sublease. The accompanying consolidated balance sheet includes a liability of $ 0.4 million in accrued lease termination costs with a current portion of $0.1 million as of the end of fiscal year 2014. | |||||
Purchase Commitments | |||||
We have agreements with some of the nation’s largest food, paper, and beverage manufacturers in the industry. This enables us to provide our restaurants with high quality proprietary food products and non-food items at competitive prices. We source and negotiate prices directly with these suppliers and distribute these products to our restaurants primarily through a national network that consists of some of the nation’s largest independent distributors. These primary suppliers and independent distributors have parallel facilities and systems to minimize the risk of any disruption of our supply chain. We do not utilize a commissary system. Our inventory control system allows each restaurant to place orders electronically with our master distributor and then transmits the invoices electronically to our accounts payable system. | |||||
We have an agreement with Distribution Market Advantage, Inc. (“Distribution Marketing Advantage”) that provides us access to a national network of independent distributors. Under this agreement, the independent distributors supply us with approximately 76% of our food and paper products, primarily under pricing agreements that we negotiate directly with the suppliers. This agreement will expire on December 30, 2015. | |||||
We have a long-term beverage marketing agreement with the Coca-Cola Company. We received a marketing allowance under this agreement, which is being recognized as a reduction to expense ratably based on actual products purchased. Effective January 1, 2011, the beverage marketing agreement with the Coca-Cola Company was amended to provide for additional products as well as higher marketing allowances based on purchases. | |||||
In April 2015, we will enter into an agreement to purchase all contracted coffee products through a single supplier, Coffee Bean International (a division of Farmer Brothers). This is a three year agreement, expiring in 2018. | |||||
Our primary suppliers and independent distributors have parallel facilities and systems to minimize the risk of any disruption of our supply chain. | |||||
Self-Insurance | |||||
We have a self-insured group health insurance plan. We are responsible for all covered claims to a maximum limit of $100,000 per participant and an additional aggregating maximum limit of $50,000 for the plan year. Benefits paid in excess of these limits are reimbursed to the plan under our stop-loss policy. In addition, we have an aggregate stop-loss policy whereby our liability for total claims submitted cannot exceed a pre-determined dollar factor based upon, among other things, past years’ claims experience, actual claims paid, the number of plan participants and monthly accumulated aggregate deductibles. We did not exceed this pre -determined maximum during fiscal years 2014, 2013, and 2012. For our 2015 plan year, this pre-determined dollar amount is $1.4 million. Health insurance expense for fiscal years 2014, 2013, and 2012 was $0.8 million, $1.5 million, and $1.4 million, respectively. The balance in the self-insurance reserve account was approximately $0.1 million and $0.2 million at December 29, 2014 and December 30, 2013, respectively. | |||||
Litigation | |||||
From time to time, we are a defendant in litigation arising in the ordinary course of our business. As of the date of this report, there are no legal proceedings that would require accrual or disclosure under ASC 450. | |||||
Other events | |||||
We are currently in compliance with all covenant requirements under the MILFAM and AB Note Agreements. | |||||
Rights Offering | |||||
On December 23, 2014, we completed a shareholders’ rights offering to our shareholders of record as of October 31, 2014. We issued a total of 13,333,329 shares of our common stock, $0.01 par value, at a subscription price of $1.50 per share. We received net proceeds of approximately $19.7 million from the rights offering of common stock which the Company intends to use for general corporate purposes, which may include, but are not limited to, funding our growth plan, working capital and capital expenditures, such as initiatives to propel sales growth in our restaurants, investing in technology, including remote ordering, POS system upgrade, and initiatives to increase through-put efficiencies; upgrading equipment and furnishings, and refreshing our restaurants; and, funding our operations. We may also use proceeds from the rights offering to pay down debt. A portion of the funds was used for construction of a new restaurant in Chicago that opened in December of 2014. | |||||
Notice of Compliance with Nasdaq Listing Standards | |||||
On September 15, 2014, the Company announced that it had received notice from the Listing Qualifications Department of the Nasdaq Capital Market that the Company had regained compliance with the Nasdaq Listing Standards by curing the Company’s deficiency in minimum $2.5 million shareholders’ equity, $35 million market value in listed securities or $500,000 of net income from continuing operations requirements for the Nasdaq Capital Market as set forth in Listing Rules 5550(b). As of September 11, 2014, for the prior 10 consecutive business days, the Company’s market value of listed securities had been $ 35 million or greater. The Company now meets the continued listing standards for the Nasdaq Capital Market and no further action is required. |
Subsequent_Events
Subsequent Events | 12 Months Ended |
Dec. 29, 2014 | |
Subsequent Events [Abstract] | |
Subsequent Events | 13. Subsequent Events |
Departure of Chief Financial Officer | |
On January 21, 2015, Scott Carlock resigned as Chief Financial Officer of Cosi, Inc. (the Company”) to pursue other opportunities, effective immediately. Mr. Carlock is not resigning because of a disagreement on any matter relating to the Company’s operations, policies or practices. | |
Appointment of Interim Chief Financial Officer | |
On January 21, 2015, the Company appointed Richard Bagge as interim Chief Financial Officer (“CFO”) of the Company, effective immediately, until a successor for Mr. Carlock has been identified. The Company has engaged an executive search firm to commence a search for a replacement CFO | |
Election to Cause Merger Agreement | |
On March 18, 2014, we entered into an Election to Cause Merger Agreement (the “Hearthstone Agreement”) with Hearthstone Associates, Inc. (“Hearthstone Associates”), Robert J. Dourney and Nancy Dourney (we refer to Nancy and Robert J. Dourney together as the “Holders”). Hearthstone Associates, which is wholly owned by the Holders, operates certain Così franchise restaurants through its wholly-owned subsidiary, Hearthstone Partners, LLC, a Massachusetts limited liability company (the “Hearthstone Subsidiary”). The Hearthstone Agreement was entered into in connection with Mr. Dourney’s appointment as our President and Chief Executive Officer. | |
Under the terms of the Hearthstone Agreement, we granted to Hearthstone Associates the right, exercisable at the discretion of Hearthstone Associates at any time after January 1, 2015 and before March 18, 2015, to require us to acquire Hearthstone Associates through a reverse triangular merger of Hearthstone Associates with and into a subsidiary of ours (the “Hearthstone Merger”). If the Hearthstone Merger is consummated, we will be required to issue 1,790,993 shares of our common stock to the Holders in consideration for the Hearthstone Merger. | |
On January 2, 2015, Hearthstone Associates notified us that we would be required to effect the Hearthstone Merger. We expect to close the Hearthstone Merger in the second quarter of 2015, subject to receipt of certain lender consents of Hearthstone Associates and satisfaction of other customary conditions. | |
Hearthstone Associates’ total assets as of January 26, 2015 were $4.8 million, including $3.9 million of net property and equipment. Hearthstone Associates’ total liabilities as of January 26, 2015 were $9.4 million, of which $7.5 million is included in the Hearthstone Indebtedness, as described below. | |
If the Hearthstone Merger is consummated, certain indebtedness of Hearthstone Associates will remain outstanding, including the Partner Note (as defined below), the Private Investor Notes (as defined below), and the FFCC Notes (as defined below), together with any outstanding indebtedness under the New Restaurant Loans (as defined below) (collectively, the “Hearthstone Indebtedness”). The estimated aggregate of the Hearthstone Indebtedness outstanding as of January 26, 2015, is approximately $10.7 million, comprised of the amounts described below. | |
The “Partner Note” refers to the Term Note dated March 20, 2009, made by Robert J. Dourney, as borrower, in favor of Shawn C. Ryan, as lender, in the principal amount of $ 3.3 million, provided that such Partner Note has been transferred to Hearthstone Associates prior to the consummation of the Hearthstone Merger. The Partner Note accrues interest at the rate of five percent (5%) per annum, and the maturity date of the Partner Note is March 30, 2016 (the “PN Maturity Date”). Commencing on June 30, 2009 and until the PN Maturity Date, Mr. Dourney agreed to make quarterly payments of accrued interest in arrears at the annual rate of five percent (5%), quarterly principal payments of $30,000 from June 30, 2011, through March 30, 2012, quarterly principal payments of $60,000 from June 30, 2012 through December 30, 2015, and a final balloon payment of the remaining outstanding balance on March 31, 2016. Past due principal and interest, to the extent permitted by law, will accrue interest at twelve percent (12%). The Partner Note is secured by all of the assets of Mr. Dourney and is non-assignable. The note contains other customary terms and conditions. As of January, 29 2015, the outstanding principal indebtedness under the Partner Note was $3.3 million. | |
“Private Investor Notes” collectively refers to the Promissory Note dated June 1, 2013, made by the Hearthstone Subsidiary, as borrower, in favor of John E. Pepper, Jr., as lender, in the principal amount of $1.5 million, and the Promissory Note dated June 1, 2013, made by the Hearthstone Subsidiary, as borrower, in favor of John S. Pepper, in the principal amount of $0.5 million. The maturity date of the Private Investor Notes is May 31, 2016 (the “PIN Maturity Date”). The Private Investor Notes accrue interest at a rate equal to LIBOR plus eight percent (8%) per annum. Interest is due to be paid quarterly. No principal payments are due under the Private Investor Notes until the PIN Maturity Date. If the Private Investor Notes are not paid in full on or before the PIN Maturity Date, interest will accrue on the unpaid balance at the rate of eighteen percent (18%) per annum. The Private Investor Notes can be prepaid at any time. However, if the Hearthstone Subsidiary is sold on or before the PIN Maturity Date for gross proceeds greater than $20.0 million, then the Hearthstone Subsidiary is required to pay 5.0% of gross sale proceeds in excess of $20.0 million to the lender. The Private Investor Notes contain other customary terms and conditions. As of January 29, 2014, the aggregate outstanding principal indebtedness under the Private Investor Notes was $2.0 million. | |
“FFCC Notes” collectively refers to the Secured Promissory Notes dated on or about May 9, 2013, made by the Hearthstone Subsidiary, as borrower, in favor of First Franchise Capital Corporation (“FFCC”), as lender, in the aggregate principal amount of $5.4 million. The FFCC Notes have a term of 60 months, commencing on June 10, 2013, and accrue interest on the outstanding balance at the rate of 5.93%. Payments of principal and interest of $60,000 are due monthly within one balloon payment of $3.2 million due June 10, 2018. Under each of the FFCC Notes, a late fee equal to 10% of the amount past due will be assessed on any late payments, reduced to 5% on any amount paid after the maturity date. The FFCC Notes are secured by all of the assets of the Hearthstone Subsidiary, including, without limitation, the restaurants it operates. The FFCC Notes may be prepaid; however, if prepayment occurs prior to June 10, 2015, the Hearthstone Subsidiary will be required to pay a prepayment fee of 4.0% of the outstanding principal balance, and if prepayment occurs thereafter, the Hearthstone Subsidiary will be required to pay a prepayment fee of 1.0% of the outstanding principal balance. The FFCC Notes are guaranteed by Robert J. Dourney and Hearthstone Associates. If the Hearthstone Subsidiary requests that a co-obligor be added to the FFCC Notes or that the FFCC Notes be assumed by any party, FFCC, in its sole and exclusive discretion, may agree to such co-obligor or assumption, provided that (a) the Hearthstone Subsidiary must pay to FFCC a fee equal to 1% of the total then- outstanding balance, (b) such co-obligor or assuming party must meet all of the credit criteria of FFCC and any regulatory standards, and (c) the parties must enter into such contracts as FFCC deems necessary. The FFCC Notes contain other customary terms and conditions. As of January 29, 2015, the aggregate outstanding principal indebtedness under the FFCC Notes was $4.8 million. | |
“New Restaurant Loans” refers to borrowings to be made by Hearthstone Associates or the Hearthstone Subsidiary of up to $1.0 million pursuant to commitments by third parties for construction of and equipment for a new franchise restaurant which opened in the first quarter of 2015. Approximately $0.8 million was outstanding under the New Restaurant Loans as of January 29, 2014. | |
FFCC has agreed to provide its consent to the Merger on the condition that the Company deposit $5,000,000 (“Cash Collateral”) to FFCC to secure Hearthstone Partner’s remaining obligations under the FFCC Notes. The Cash Collateral would remain in a control account until FFCC determines, in its sole discretion that the indebtedness is adequately supported by the financial performance of the Company, or the indebtedness due to FFCC is paid in full. As the outstanding balance under the FFCC Notes is reduced, the Company may request once annually that the Cash Collateral be ratably reduced. As a further condition, the Company has agreed to the obligations of Hearthstone Partners under the FFCC Notes. |
Organization_and_Summary_of_Si1
Organization and Summary of Significant Accounting Policies (Policies) | 12 Months Ended | ||||||||||||||||||||
Dec. 29, 2014 | |||||||||||||||||||||
Organization and Summary of Significant Accounting Policies [Abstract] | |||||||||||||||||||||
Organization | Organization | ||||||||||||||||||||
Cosi, Inc., a Delaware corporation, owns, operates, and franchises fast-casual dining restaurants which sell high-quality, made-to-order sandwiches, salads, bowls, and coffees, along with a variety of other soft drink beverages, teas, baked goods and alcoholic beverages. As of December 29, 2014, there were 64 Company-owned and 47 franchised restaurants operating in 16 states, the District of Columbia, the United Arab Emirates, and Costa Rica. | |||||||||||||||||||||
Fiscal Year | Fiscal Year | ||||||||||||||||||||
Our fiscal year ends on the Monday closest to December 31. Fiscal years ended December 29, 2014, December 30, 2013, December 31, 2012 are referred to as fiscal 2014, 2013, and 2012, respectively. Each of fiscal years 2014, 2013 and 2012 included 52 weeks | |||||||||||||||||||||
Basis of Presentation | Basis of Presentation | ||||||||||||||||||||
The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and include the accounts of the Company and its wholly-owned subsidiaries. All inter-company accounts and transactions have been eliminated | |||||||||||||||||||||
Cash and Cash Equivalents | Cash and Cash Equivalents | ||||||||||||||||||||
We consider all short-term investments with a maturity of three months or less from the date of purchase to be cash equivalents. | |||||||||||||||||||||
Concentration of Credit Risks | Concentration of Credit Risks | ||||||||||||||||||||
Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash deposits. We place our cash deposits in Federal Deposit Insurance Corporation (“FDIC”) insured financial institutions. Balances of cash deposits may, at times, exceed FDIC insured limits. We have never experienced losses related to these balances. | |||||||||||||||||||||
Our accounts receivable consist principally of trade or “house” accounts representing corporate customers and amounts due from franchisees. We have established credit procedures and analyses to control the granting of credit to customers. Credit card transactions at the Company’s restaurants are processed by a single service provider. | |||||||||||||||||||||
Accounts Receivable | Accounts Receivable | ||||||||||||||||||||
Trade accounts receivable are stated at net realizable value. The Company maintains a reserve for potential uncollectible accounts based on historical trends and known current factors impacting the Company’s customers or franchisees. | |||||||||||||||||||||
Inventories | Inventories | ||||||||||||||||||||
Inventories are stated at the lower of cost, determined using a weighted average valuation method that approximates the first-in, first-out method, or market, and consist principally of food, beverage, liquor, packaging and related food supplies. | |||||||||||||||||||||
Furniture and Fixtures, Equipment and Leasehold Improvements | Furniture and Fixtures, Equipment and Leasehold Improvements | ||||||||||||||||||||
Furniture and fixtures, equipment and leasehold improvements are stated at cost. Depreciation of furniture and fixtures and equipment is computed using the straight-line method over estimated useful lives that range from two to ten years. Leasehold improvements are amortized using the straight-line method over the shorter of their estimated useful lives or the term of the related leases. | |||||||||||||||||||||
Upon retirement or sale, the cost of assets disposed of and their related accumulated depreciation are removed from the accounts. Any resulting gain or loss is credited or charged to operations. Maintenance and repairs are charged to expense when incurred, while betterments are capitalized. | |||||||||||||||||||||
Long-Lived Assets | Long-Lived Assets | ||||||||||||||||||||
Impairment losses are recorded on long -lived assets on a restaurant-by-restaurant basis whenever impairment factors are determined to be present. We consider a consistent history of poor financial operating performance to be the primary indicator of potential impairment for individual restaurant locations. We determine whether a restaurant location is impaired based on expected undiscounted cash flows, generally for the remainder of the original lease term, and then determine the impairment charge based on discounted cash flows for the same period. | |||||||||||||||||||||
In accordance with the provisions of the impairment or disposal subsections of ASC 360-10, Property, Plant & Equipment, long-lived assets held and used with a carrying amount of $2.2 million were written down to their fair value of $1.2 million, resulting in asset impairment and disposal charges of $1.0 million which were included in earnings for fiscal 2013. We did not record any impairment charges during fiscal 2014 but if stores do not reach their expected sales, impairment maybe a possibility in the near future. We considered all relevant valuation techniques that could be obtained without undue cost and effort, and concluded that the discounted cash flow approach continued to provide the most relevant and reliable means by which to determine fair value of the long-lived assets held and used. | |||||||||||||||||||||
Prices in Active | Significant | Significant | |||||||||||||||||||
Markets for | Observable | Unobservable | |||||||||||||||||||
Long-lived assets held | Total value at | Identical Assets | Inputs | Inputs | Total | ||||||||||||||||
and used | end of period | (Level 1) | (Level 2) | (Level 3) | (Losses) | ||||||||||||||||
(in thousands) | |||||||||||||||||||||
29-Dec-14 | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||
$ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||
30-Dec-13 | $ | 1,219 | $ | - | $ | - | $ | 1,219 | $ | (1,005 | ) | ||||||||||
$ | 1,219 | $ | - | $ | - | $ | 1,219 | $ | (1,005 | ) | |||||||||||
31-Dec-12 | $ | 348 | $ | - | $ | - | $ | 348 | $ | (424 | ) | ||||||||||
$ | 348 | $ | - | $ | - | $ | 348 | $ | (424 | ) | |||||||||||
The asset impairment charges relate to ten and four underperforming restaurants and for maintenance capital expenditures on previously impaired restaurants, in fiscal years 2013 and 2012, respectively. | |||||||||||||||||||||
Accounting for Lease Obligations | Accounting for Lease Obligations | ||||||||||||||||||||
We recognize rent expense on a straight-line basis over the lease term commencing on the date we take possession. We record landlord allowances as deferred rent in other long-term liabilities on the consolidated balance sheets and amortize them on a straight-line basis over the term of the related lease. | |||||||||||||||||||||
Lease Termination Charges | Lease Termination Charges | ||||||||||||||||||||
Future store closings, if any, resulting from our decision to close underperforming locations prior to their scheduled lease expiration dates may result in additional lease termination charges. For all exit activities, we estimate our likely liability under contractual leases for restaurants that have been closed. Such estimates have affected the amount and timing of charges to operating results and are impacted by management’s judgments about the time it may take to find a suitable subtenant or assignee, or the terms under which a termination of the lease agreement may be negotiated with the landlord. We recognize costs associated with exit or disposal activities at the time a commitment to an exit or disposal plan is communicated to the landlord. | |||||||||||||||||||||
We incurred lease termination charges of approximately $1.5 million during fiscal 2014 related to the closing of 10 Company-owned restaurants. The lease termination charges that we recorded in fiscal years 2013 and 2012 were immaterial. | |||||||||||||||||||||
A summary of lease termination reserve activity is as follows: | |||||||||||||||||||||
(in thousands) | |||||||||||||||||||||
Balance as of January 2, 2012 | 245 | ||||||||||||||||||||
Charged to costs and expenses | 2 | ||||||||||||||||||||
Payments and adjustments | (33 | ) | |||||||||||||||||||
Balance as of December 31, 2012 | 214 | ||||||||||||||||||||
Charged to costs and expenses | 127 | ||||||||||||||||||||
Payments and adjustments | (191 | ) | |||||||||||||||||||
Balance as of December 30, 2013 | 150 | ||||||||||||||||||||
Charged to costs and expenses | 1,468 | ||||||||||||||||||||
Payments and adjustments | (1,218 | ) | |||||||||||||||||||
Balance as of December 29, 2014 | 400 | ||||||||||||||||||||
Other Liabilities | Other Liabilities | ||||||||||||||||||||
Other liabilities consist of deferred rent, landlord allowances and accrued lease termination costs (see Note 12 to our consolidated financial statements). | |||||||||||||||||||||
Income Taxes | Income Taxes | ||||||||||||||||||||
We have recorded a full valuation allowance to reduce our deferred tax assets that relate primarily to net operating loss carryforwards. Our determination of the valuation allowance is based on an evaluation of whether it is more likely than not that we will be able to utilize the net operating loss carryforwards based on the Company’s operating results. A positive adjustment to income will be recorded in future years if we determine that we could realize these deferred tax assets. | |||||||||||||||||||||
As of December 29, 2014, we had net operating loss (“NOL”) carryforwards of approximately $243 million for U.S. federal income tax purposes. Under the Internal Revenue Code, an “ownership change” with respect to a corporation can significantly limit the amount of pre-ownership change NOLs and certain other tax assets that the corporation may utilize after the ownership change to offset future taxable income. An ownership change generally would occur if the aggregate stock ownership of holders of at least 5% of our stock increases by more than 50 percentage points over the preceding three-year period. We do not believe that the December 23, 2014, July 9, 2012, and the previously disclosed January 6, 2010, rights offerings and the related private placements of common stock triggered an ownership change which would generally occur if the aggregate stock ownership of holders of at least 5% of our stock increases by more than 50 percentage points over the preceding three-year period. In addition, a limitation would not have an impact on our consolidated financial statements as we have recorded a valuation allowance for the entire amount of our deferred tax assets. | |||||||||||||||||||||
We adopted ASC 740-10, Income Taxes, which prescribes a comprehensive financial statement model of how a company should recognize, measure, present and disclose uncertain tax positions that the company has taken or expects to take in its income tax returns. The standard requires that only income tax benefits that meet the “more likely than not” recognition threshold be recognized or continue to be recognized on the effective date. Initial recognition amounts would have been reported as a cumulative effect of a change in accounting principle. | |||||||||||||||||||||
Should the Company need to accrue interest or penalties on uncertain tax positions, it would recognize the interest as interest expense and the penalties as a general and administrative expense. | |||||||||||||||||||||
Due to our unexpired NOLs, Cosi could be subject to IRS income tax examination for the tax year 1996 and all subsequent years. We could also be subject to state income tax examinations in certain states where we have unexpired NOLs. | |||||||||||||||||||||
Revenue Recognition | Revenue Recognition | ||||||||||||||||||||
Restaurant Net Sales. Our Company-owned restaurant sales are composed almost entirely of food and beverage sales. We record revenue at the time of the purchase of our products by our customers. | |||||||||||||||||||||
Franchise Fees and Royalties. Franchise fees and royalties includes fees earned from franchise agreements entered into with area developers and franchise operators, as well as royalties received based on sales generated at franchised restaurants. We recognize the franchise fee in the period in which a franchise location opens or when fees are forfeited as a result of a termination of an area development agreement. We recognize franchise royalties in the period in which sales are made by our franchise operators. | |||||||||||||||||||||
Gift Card Sales. We offer our customers the opportunity to purchase gift cards at our restaurants and through our website. Customers can purchase these cards at varying dollar amounts. At the time of purchase by the customer, we record a gift card liability for the face value of the card purchased. We recognize the revenue and reduce the gift card liability when the gift card is redeemed. We do not reduce our recorded liability for potential non-use of purchased gift cards. | |||||||||||||||||||||
Gain on Sale of Assets | Gain on Sale of Assets | ||||||||||||||||||||
The gain from the sale of one liquor license that we recognized during each of fiscal 2014 and 2013 was immaterial. There was no gain in fiscal 2012. | |||||||||||||||||||||
Restaurant Pre-opening Expenses | Restaurant Pre-opening Expenses | ||||||||||||||||||||
Restaurant pre-opening expenses are expensed as incurred and include the costs of recruiting, hiring and training the initial restaurant work force, travel, the cost of food and labor used during the period before opening, the cost of initial quantities of supplies and other direct costs related to the opening or remodeling of a restaurant. Pre-opening expenses also include rent expense recognized on a straight-line basis from the date we take possession through the period of construction or renovation prior to opening the restaurant. The restaurant pre-opening expenses that we incurred during fiscal 2014 and 2013 related to the opening of one new restaurant in Chicago, Illinois, and to the relocation of one Company-owned restaurant in Ohio, respectively both which were immaterial. | |||||||||||||||||||||
Advertising Costs | Advertising Costs | ||||||||||||||||||||
Domestic franchise-operated Cosi® restaurants contribute 1% of their sales to a national marketing fund and are also required to spend 1% of their sales on advertising in their local markets. Our international franchise-operated restaurants contribute 0.5% of their sales to an international marketing fund. The Company also contributes 1% of sales from Company-owned restaurants to the national marketing fund. The Company’s contributions, as well as its own local market media costs, are recorded as part of occupancy and other restaurant operating expenses on the Company’s consolidated statements of operations. Advertising costs are expensed as incurred and were approximately $1.0 million, $0.9 million, and $1.2 million in fiscal years 2014, 2013, and 2012, respectively. | |||||||||||||||||||||
Net Loss Per Share | Net Loss Per Share | ||||||||||||||||||||
Basic and diluted loss per common share is calculated by dividing the net loss by the weighted-average common shares outstanding during each period. As of December 29, 2014, December 30, 2013, and December 31, 2012, there were, respectively, 1,175,064 unvested restricted shares, 11,325 unvested restricted shares and 271,400 unvested restricted shares of common stock outstanding, and 3,750 out-of the money, 53,514 out-of the money and 38,552 out-of-the-money stock options to purchase shares of common stock. There were no in-the-money stock options as of the end of fiscal years 2014, 2013, and 2012. The unvested restricted shares and the out-of-the-money stock options meet the requirements for participating securities but were not included in the computation of basic and diluted earnings per share because we incurred a net loss in all periods presented and, hence, the impact would be anti-dilutive. | |||||||||||||||||||||
Stock-Based Compensation | Stock-Based Compensation | ||||||||||||||||||||
In accordance with ASC 718-10-25, Compensation – Stock Compensation, we recognize stock-based compensation expense according to the fair value recognition provision which generally requires, among other things, that all employee share-based compensation is measured using a fair value method and that all the resulting compensation expense is recognized in the financial statements. In accordance with the standard, our stock-based compensation expense is recognized on a straight-line basis over the requisite service period of the award, which is the vesting term. As a result, we recognized stock compensation expense of approximately $0.5 million, $0.1 million, and $0.4 million during fiscal years 2014, 2013, and 2012, respectively. We measure the estimated fair value of our granted stock options using a Black-Scholes pricing model and of our restricted stock based on the fair market value of a share of registered stock on the date of the grant. | |||||||||||||||||||||
Segment Information | Segment Information | ||||||||||||||||||||
Operating segments are defined as components of an enterprise about which separate financial information is available and is evaluated regularly by the chief operating decision maker in deciding how to allocate resources in assessing performance. Our chief operating decision maker reviews one aggregated set of financial statements to make decisions about resource allocations and to assess performance. Consequently, we have one reportable segment for all sales generated. | |||||||||||||||||||||
Accounting Estimates | Accounting Estimates | ||||||||||||||||||||
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results may differ from those estimates. |
Organization_and_Summary_of_Si2
Organization and Summary of Significant Accounting Policies (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 29, 2014 | |||||||||||||||||||||
Organization and Summary of Significant Accounting Policies [Abstract] | |||||||||||||||||||||
Schedule of fair value of long-lived assets held and used | In accordance with the provisions of the impairment or disposal subsections of ASC 360-10, Property, Plant & Equipment, long-lived assets held and used with a carrying amount of $2.2 million were written down to their fair value of $1.2 million, resulting in asset impairment and disposal charges of $1.0 million which were included in earnings for fiscal 2013. We did not record any impairment charges during fiscal 2014 but if stores do not reach their expected sales, impairment maybe a possibility in the near future. We considered all relevant valuation techniques that could be obtained without undue cost and effort, and concluded that the discounted cash flow approach continued to provide the most relevant and reliable means by which to determine fair value of the long-lived assets held and used. | ||||||||||||||||||||
Prices in Active | Significant | Significant | |||||||||||||||||||
Markets for | Observable | Unobservable | |||||||||||||||||||
Long-lived assets held | Total value at | Identical Assets | Inputs | Inputs | Total | ||||||||||||||||
and used | end of period | (Level 1) | (Level 2) | (Level 3) | (Losses) | ||||||||||||||||
(in thousands) | |||||||||||||||||||||
29-Dec-14 | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||
$ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||
30-Dec-13 | $ | 1,219 | $ | - | $ | - | $ | 1,219 | $ | (1,005 | ) | ||||||||||
$ | 1,219 | $ | - | $ | - | $ | 1,219 | $ | (1,005 | ) | |||||||||||
31-Dec-12 | $ | 348 | $ | - | $ | - | $ | 348 | $ | (424 | ) | ||||||||||
$ | 348 | $ | - | $ | - | $ | 348 | $ | (424 | ) | |||||||||||
Summary of lease termination reserve activity | A summary of lease termination reserve activity is as follows: | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||
Balance as of January 2, 2012 | 245 | ||||||||||||||||||||
Charged to costs and expenses | 2 | ||||||||||||||||||||
Payments and adjustments | (33 | ) | |||||||||||||||||||
Balance as of December 31, 2012 | 214 | ||||||||||||||||||||
Charged to costs and expenses | 127 | ||||||||||||||||||||
Payments and adjustments | (191 | ) | |||||||||||||||||||
Balance as of December 30, 2013 | 150 | ||||||||||||||||||||
Charged to costs and expenses | 1,468 | ||||||||||||||||||||
Payments and adjustments | (1,218 | ) | |||||||||||||||||||
Balance as of December 29, 2014 | 400 |
Accounts_Receivable_Tables
Accounts Receivable (Tables) | 12 Months Ended | ||||||||
Dec. 29, 2014 | |||||||||
Accounts Receivable [Abstract] | |||||||||
Schedule of components of accounts receivable | Accounts receivable consist of the following: | ||||||||
December 29, | December 30, | ||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Accounts receivable, trade | $ | 408 | $ | 342 | |||||
Due from franchisees | 190 | 473 | |||||||
Other | 101 | 123 | |||||||
Total receivables | 699 | 938 | |||||||
Less: allowance for doubtful accounts | (118 | )(1) | (344 | )(1) | |||||
Accounts receivable, net | $ | 581 | $ | 594 | |||||
(1) Does not include approximately $0.5 million in reserve on a note receivable from a franchisee presented in Note 5. Notes Receivable | |||||||||
Summary of reserve for doubtful accounts | A summary of the reserve for doubtful accounts follows: | ||||||||
(in thousands) | |||||||||
Balance as of January 2, 2012 | 254 | ||||||||
Charged to costs and expenses | 46 | ||||||||
Deductions | 3 | (a) | |||||||
Balance as of December 31, 2012 | 303 | ||||||||
Charged to costs and expenses | 491 | (b) | |||||||
Deductions | - | (a) | |||||||
Balance as of December 30, 2013 | 794 | ||||||||
Charged to costs and expenses | - | ||||||||
Deductions | 226 | (a) | |||||||
Balance as of December 29, 2014 | 568 | ||||||||
(a) | Recovery (write-off) of uncollectible accounts | ||||||||
(b) | Includes approximately $0.5 million reserve on a note receivable from a franchisee |
Prepaid_Expenses_and_Other_Cur1
Prepaid Expenses and Other Current Assets (Tables) | 12 Months Ended | ||||||||
Dec. 29, 2014 | |||||||||
Prepaid Expenses and Other Current Assets [Abstract] | |||||||||
Schedule of components of prepaid expenses and other current assets | Prepaid expenses and other current assets consist of the following: | ||||||||
December 29, | December 30, | ||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Prepaid insurance | $ | 1,208 | $ | 1,263 | |||||
Other | 71 | 85 | |||||||
Prepaid expenses and other current assets | $ | 1,279 | $ | 1,348 |
Furniture_and_Fixtures_Equipme1
Furniture and Fixtures, Equipment and Leasehold Improvements (Tables) | 12 Months Ended | ||||||||
Dec. 29, 2014 | |||||||||
Furniture and Fixtures, Equipment and Leasehold Improvements [Abstract] | |||||||||
Schedule of components of furniture and fixtures, equipment and leasehold improvements | Furniture and fixtures, equipment and leasehold improvements consist of the following: | ||||||||
December 29, | December 30, | ||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Leasehold improvements | $ | 29,481 | $ | 31,361 | |||||
Furniture and fixtures | 9,110 | 10,325 | |||||||
Computer and telephone equipment | 11,231 | 11,492 | |||||||
Restaurant equipment | 14,957 | 16,228 | |||||||
Vehicles | 39 | 39 | |||||||
Total furniture and fixtures, equipment and leasehold improvements | 64,818 | 69,445 | |||||||
Less accumulated depreciation and amortization | (57,510 | ) | (61,250 | ) | |||||
Furniture and fixtures, equipment and leasehold improvements, net | $ | 7,308 | $ | 8,195 |
Notes_Receivable_Tables
Notes Receivable (Tables) | 12 Months Ended | ||||||||
Dec. 29, 2014 | |||||||||
Notes Receivable [Abstract] | |||||||||
Schedule of notes receivable | December 29, | December 30, | |||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Sale of restaurant to a franchisee in 2010 | 925 | 925 | |||||||
Other | 76 | 76 | |||||||
Total notes receivable | 1,001 | 1,001 | |||||||
Less: allowance for doubtful accounts | (450 | )(1) | (450 | )(1) | |||||
Total notes receivable | $ | 551 | $ | 551 | |||||
(1) Denotes a reserve on a note receivable f rom a franchisee included in the summary of the reserve for doubtful accounts in Note 1. Accounts Receivable. |
Other_Assets_Tables
Other Assets (Tables) | 12 Months Ended | ||||||||
Dec. 29, 2014 | |||||||||
Other Assets [Abstract] | |||||||||
Schedule of components of other assets | Other assets consist of the following: | ||||||||
December 29, | December 30, | ||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Security deposits | 721 | 788 | |||||||
Deferred financing costs | 312 | - | |||||||
Trademarks | 195 | 195 | |||||||
Liquor licenses | 85 | 85 | |||||||
Other | 14 | 47 | |||||||
Total other assets | $ | 1,327 | $ | 1,115 |
Accrued_Expenses_Tables
Accrued Expenses (Tables) | 12 Months Ended | ||||||||
Dec. 29, 2014 | |||||||||
Accrued Expenses [Abstract] | |||||||||
Schedule of components of accrued expenses | Accrued expenses consist of the following: | ||||||||
December 29, | December 30, | ||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Payroll and related benefits and taxes | $ | 1,932 | $ | 2,143 | |||||
Unredeemed gift cards/certificates | 2,032 | 2,067 | |||||||
Insurance | 1,229 | 1,327 | |||||||
Utilities | 613 | 857 | |||||||
Rent | 523 | 516 | |||||||
Professional and legal | 376 | 497 | |||||||
Construction costs | 293 | - | |||||||
Taxes other than income taxes | 274 | 383 | |||||||
Deferred credits | 278 | 323 | |||||||
Rights offering professional fees | 265 | - | |||||||
Advertising | 95 | 103 | |||||||
Other | 1,426 | 872 | |||||||
Total accrued expenses | $ | 9,336 | $ | 9,088 |
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||||||
Dec. 29, 2014 | |||||||||||||
Income Taxes [Abstract] | |||||||||||||
Schedule of significant components of deferred tax assets, net of any deferred tax liabilities | Significant components of our deferred tax assets, net of any deferred tax liabilities, are as follows: | ||||||||||||
December 29, | December 30, | ||||||||||||
2014 | 2013 | ||||||||||||
(in thousands) | |||||||||||||
Deferred tax assets: | |||||||||||||
Net operating loss carryforward | $ | 96,350 | $ | 89,488 | |||||||||
Depreciation expense and impairment of long-lived assets | 13,747 | 14,215 | |||||||||||
Contractual lease increases and other | 529 | 851 | |||||||||||
Deferred franchise revenue | 1,203 | 1,244 | |||||||||||
Stock-based compensation | 1,293 | 1,161 | |||||||||||
Lease termination accrual | 158 | 60 | |||||||||||
Allowance for doubtful accounts | 462 | 315 | |||||||||||
Total deferred tax assets | 113,742 | 107,334 | |||||||||||
Valuation allowance | (113,742 | ) | (107,334 | ) | |||||||||
Net deferred taxes | $ | - | $ | - | |||||||||
Schedule of reconciliation of the statutory federal income tax rate to the effective tax rate as a percentage of income before income taxes | Below is a reconciliation of the statutory federal income tax rate to the effective tax rate as a percentage of income before income taxes: | ||||||||||||
December 29, | December 30, | December 31, | |||||||||||
2014 | 2013 | 2012 | |||||||||||
Statutory federal income tax rate | 35 | % | 35 | % | 35 | % | |||||||
State income taxes | 4.6 | 4.6 | 4.6 | ||||||||||
39.6 | 39.6 | 39.6 | |||||||||||
Less valuation allowance | (39.6 | ) | (39.6 | ) | (39.6 | ) | |||||||
Effective Tax Rate | 0 | % | 0 | % | 0 | % |
Stockholders_Equity_Tables
Stockholders' Equity (Tables) | 12 Months Ended | ||||
Dec. 29, 2014 | |||||
MILFAM II Note Agreement [Member] | |||||
Senior Secured Promissory Notes [Line Items] | |||||
Black-Scholes model using the following assumptions | On September 16, 2014, 1.1 million of the warrants provided under the MILFAM Note Agreement were exercised in order to purchase 1.1 million unregistered shares of the Company’s common stock at an exercise price of $0.01 per share, resulting in an aggregate purchase price of $11,000. The stock warrants were carried at a fair value as of the issuance date of approximately $1.3 million based on the Black-Scholes model using the following assumptions: | ||||
Expected life (in years) | 3 | ||||
Volatility | 63.86 | % | |||
Risk Free interest rate | 0.82 | % | |||
Dividend yield (on common stock) | 0 | ||||
AB Note Purchase Agreement [Member] | |||||
Senior Secured Promissory Notes [Line Items] | |||||
Black-Scholes model using the following assumptions | On October 14, 2014, 550,000 of the warrants provided under the AB Note Purchase Agreement were exercised by the cashless exercise method by forfeiting 2,895 shares to pay for the warrants in lieu of cash. The Company’s 550,000 stock warrants were carried at their fair value as of the issuance date of approximately $0.7 million based on the Black-Scholes model using the following assumptions: | ||||
Expected life (in years) | 3 | ||||
Volatility | 63.86 | % | |||
Risk Free interest rate | 0.82 | % | |||
Dividend yield (on common stock) | 0 |
StockBased_Employee_Compensati1
Stock-Based Employee Compensation (Tables) | 12 Months Ended | ||||||||||||||||||||||
Dec. 29, 2014 | |||||||||||||||||||||||
Stock-Based Employee Compensation [Abstract] | |||||||||||||||||||||||
Summary of stock-based compensation | A summary of stock-based compensation follows: | ||||||||||||||||||||||
Fiscal Year | |||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Stock option compensation expense | $ | - | $ | 7 | $ | - | |||||||||||||||||
Restricted stock compensation expense, net of forfeitures | 509 | 121 | 399 | ||||||||||||||||||||
Total non-cash, stock-based compensation expense, net of forfeitures | $ | 509 | $ | 128 | $ | 399 | |||||||||||||||||
Summary of option activity | A summary of option activity for fiscal years 2014, 2013, and 2012 follows: | ||||||||||||||||||||||
Weighted | |||||||||||||||||||||||
Weighted | Average | Aggregate | |||||||||||||||||||||
Number of | Average Exercise | Remaining | Intrinsic | ||||||||||||||||||||
Options | Price | Contractual Term | Value | ||||||||||||||||||||
(in years) | (in thousands) | ||||||||||||||||||||||
Outstanding as of January 2, 2012 | 41,071 | $ | 20 | 2.5 | $ | - | |||||||||||||||||
Granted | - | - | |||||||||||||||||||||
Exercised | - | - | |||||||||||||||||||||
Cancelled/Expired | (2,518 | ) | $ | 13.88 | - | ||||||||||||||||||
Outstanding as of December 31, 2012 | 38,553 | $ | 20.4 | 1.7 | $ | - | |||||||||||||||||
Granted | 25,000 | 2.8 | |||||||||||||||||||||
Exercised | - | - | |||||||||||||||||||||
Cancelled/Expired | (10,038 | ) | $ | 21.02 | - | ||||||||||||||||||
Outstanding as of December 30, 2013 | 53,515 | $ | 12.05 | 3.9 | $ | - | |||||||||||||||||
Granted | - | - | |||||||||||||||||||||
Exercised | - | - | |||||||||||||||||||||
Cancelled/Expired | (47,052 | ) | $ | 28.83 | - | ||||||||||||||||||
Outstanding as of December 29, 2014 | 6,463 | $ | 3.62 | 2.2 | $ | - | |||||||||||||||||
Exercisable as of December 29, 2014 | 3,750 | $ | 2.8 | 2.2 | $ | - | |||||||||||||||||
Schedule of stock option exercisable | The following table summarizes information about stock options outstanding at December 29, 2014: | ||||||||||||||||||||||
Options | Contractual | Exercise | Options | Exercise | |||||||||||||||||||
Range of Exercise Prices | Outstanding | Life in Years | Price | Exercisable | Price | ||||||||||||||||||
$ | 2.80 - $27.76 | 6,463 | 2.2 | $ | 3.62 | 3,750 | $ | 2.8 | |||||||||||||||
Summary of the Company's restricted stock activity | The following tables summarize the Company’s restricted stock activity: | ||||||||||||||||||||||
Number of | Weighted | ||||||||||||||||||||||
Shares of | Average | ||||||||||||||||||||||
Restricted | Grant-Date | ||||||||||||||||||||||
Stock | Fair Value | ||||||||||||||||||||||
Non-vested at January 2, 2012 | 322,100 | $ | 3.08 | ||||||||||||||||||||
Granted | 43,103 | 3.48 | |||||||||||||||||||||
Vested | 80,340 | 3.56 | |||||||||||||||||||||
Forfeited / Canceled | (13,463 | ) | 4.68 | ||||||||||||||||||||
Non-vested at December 31, 2012 | 271,400 | $ | 2.96 | ||||||||||||||||||||
Granted | 85,512 | 2.91 | |||||||||||||||||||||
Vested | 88,862 | 3 | |||||||||||||||||||||
Forfeited / Canceled | (256,725 | ) | 2.88 | ||||||||||||||||||||
Non-vested at December 30, 2013 | 11,325 | $ | 4.08 | ||||||||||||||||||||
Granted | 1,510,765 | 0.92 | |||||||||||||||||||||
Vested | 125,000 | 0.99 | |||||||||||||||||||||
Forfeited / Canceled | (79,575 | ) | 1.1 | ||||||||||||||||||||
Non-vested at December 29, 2014 | 1,317,515 | $ | 0.95 |
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | ||||
Dec. 29, 2014 | |||||
Commitments and Contingencies [Abstract] | |||||
Schedule of minimum annual rentals | As of December 30, 2014, we are committed under lease agreements expiring through 2024 for occupancy of our retail restaurants and for office space at the following minimum annual rentals: | ||||
Fiscal Year | Amount | ||||
(in thousands) | |||||
2015 | 10,777 | ||||
2016 | 8,626 | ||||
2017 | 5,956 | ||||
2018 | 4,521 | ||||
2019 | 3,861 | ||||
Thereafter | 18,359 | ||||
$ | 52,100 |
Organization_and_Summary_of_Si3
Organization and Summary of Significant Accounting Policies (Details) | 12 Months Ended | ||
Dec. 29, 2014 | Dec. 30, 2013 | Dec. 31, 2012 | |
Week | Week | Week | |
State | |||
Organization [Line Items] | |||
Number of states in which the entity owns and operates restaurants | 16 | ||
Fiscal Year [Abstract] | |||
Number of weeks in a fiscal year | 52 | 52 | 52 |
Company-owned [Member] | |||
Organization [Line Items] | |||
Number of company-owned restaurants | 64 | ||
Franchises [Member] | |||
Organization [Line Items] | |||
Number of company-owned restaurants | 47 |
Organization_and_Summary_of_Si4
Organization and Summary of Significant Accounting Policies 2 (Details) (Furniture, fixtures and equipment [Member]) | 12 Months Ended |
Dec. 29, 2014 | |
Minimum [Member] | |
Furniture and fixtures, equipment and leasehold improvements [Line Items] | |
Useful life | 2 years |
Maximum [Member] | |
Furniture and fixtures, equipment and leasehold improvements [Line Items] | |
Useful life | 10 years |
Organization_and_Summary_of_Si5
Organization and Summary of Significant Accounting Policies 3 (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 29, 2014 | Dec. 30, 2013 | Dec. 31, 2012 |
Long-lived assets [Line Items] | |||
Asset impairment and disposal charges | $0 | ($1,005) | ($424) |
Underperforming assets [Member] | |||
Long-lived assets [Line Items] | |||
Number of underperforming restaurants | 10 | 4 | |
Total value at end of period [Member] | |||
Long-lived assets [Line Items] | |||
Long-lived assets held and used | 0 | 1,219 | 348 |
Prices in Active Markets for Identical Assets (Level 1) [Member] | |||
Long-lived assets [Line Items] | |||
Long-lived assets held and used | 0 | 0 | 0 |
Significant Observable Inputs (Level 2) [Member] | |||
Long-lived assets [Line Items] | |||
Long-lived assets held and used | 0 | 0 | 0 |
Significant Unobservable Inputs (Level 3) [Member] | |||
Long-lived assets [Line Items] | |||
Long-lived assets held and used | 0 | 1,219 | 348 |
Carrying value [Member] | |||
Long-lived assets [Line Items] | |||
Long-lived assets held and used | $2,200 |
Organization_and_Summary_of_Si6
Organization and Summary of Significant Accounting Policies 4 (Details) (Restaurant leaseholds [Member], Terminated operating leases [Member], USD $) | 12 Months Ended |
In Millions, unless otherwise specified | Dec. 29, 2014 |
Restaurant | |
Restaurant leaseholds [Member] | Terminated operating leases [Member] | |
Lease termination charges [Line Items] | |
Lease termination charges incurred | $1.50 |
Number of restaurant leases terminated | 10 |
Organization_and_Summary_of_Si7
Organization and Summary of Significant Accounting Policies 5 (Details) (USD $) | 0 Months Ended | 12 Months Ended | ||||
Dec. 23, 2014 | Jul. 09, 2012 | Jan. 06, 2010 | Dec. 29, 2014 | Dec. 30, 2013 | Dec. 31, 2012 | |
Income Taxes [Abstract] | ||||||
Net operating loss carryforwards for U.S. federal income tax purposes | $243,000,000 | |||||
Minimum percentage of stock ownership required to effect ownership change (in hundredths) | 5.00% | 5.00% | 5.00% | 5.00% | ||
Minimum percentage points by which aggregate stock ownership of holders of at least 5% of stock must increase to effect ownership change (in hundredths) | 50.00% | 50.00% | 50.00% | 50.00% | ||
Period over which aggregate stock ownership of holders of at least 5% of stock must increase to effect ownership change | 3 years | 3 years | 3 years | 3 years | ||
U.S. federal income tax [Member] | ||||||
Income Taxes [Abstract] | ||||||
Net operating loss carryforwards for U.S. federal income tax purposes | 243,000,000 | |||||
Lease termination reserve [Member] | ||||||
Changes in lease termination reserve activity [Abstract] | ||||||
Balance at the beginning of the period | 150,000 | 214,000 | 245,000 | |||
Charged to costs and expenses | 1,468,000 | 127,000 | 2,000 | |||
Payments and adjustments | -1,218,000 | -191,000 | -33,000 | |||
Balance at the end of the period | $400,000 | $150,000 | $214,000 |
Organization_and_Summary_of_Si8
Organization and Summary of Significant Accounting Policies 6 (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 29, 2014 | Dec. 30, 2013 | Dec. 31, 2012 |
License | License | ||
Gain on Sale of Assets [Abstract] | |||
Number of liquor license | 1 | 1 | |
Gain on sale of liquor licenses | $0 |
Organization_and_Summary_of_Si9
Organization and Summary of Significant Accounting Policies 7 (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 29, 2014 | Dec. 30, 2013 | Dec. 31, 2012 |
Advertising costs [Line Items] | |||
Advertising expense | $1 | $0.90 | $1.20 |
Domestic franchises [Member] | |||
Advertising costs [Line Items] | |||
Percentage of sales contributed to a national marketing fund (in hundredths) | 1.00% | ||
Percentage of sales required to be spent on advertising in local markets (in hundredths) | 1.00% | ||
International franchises [Member] | |||
Advertising costs [Line Items] | |||
Percentage of sales contributed to a national marketing fund (in hundredths) | 0.50% | ||
Company-owned restaurants [Member] | |||
Advertising costs [Line Items] | |||
Percentage of sales contributed to a national marketing fund (in hundredths) | 1.00% |
Recovered_Sheet1
Organization and Summary of Significant Accounting Policies 8 (Details) (USD $) | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Dec. 29, 2014 | Dec. 30, 2013 | Dec. 31, 2012 |
Segment | |||
Stock-Based Compensation [Abstract] | |||
Stock-based compensation expense | $509 | $128 | $399 |
Segment Information [Abstract] | |||
Number of reportable segments | 1 | ||
Unvested restricted shares [Member] | |||
Net loss per share [Line Items] | |||
Anti-dilutive securities not included in the computation of basic and diluted earnings per share (in shares) | 1,175,064 | 11,325 | 271,400 |
Stock options [Member] | |||
Net loss per share [Line Items] | |||
Anti-dilutive securities not included in the computation of basic and diluted earnings per share (in shares) | 3,750 | 53,514 | 38,552 |
Accounts_Receivable_Details
Accounts Receivable (Details) (USD $) | Dec. 29, 2014 | Dec. 30, 2013 | ||
Accounts receivable [Line items] | ||||
Total receivables | $699,000 | $938,000 | ||
Less: allowance for doubtful accounts | -118,000 | [1] | -344,000 | [1] |
Accounts receivable, net | 581,000 | 594,000 | ||
Amount not included in reserve for doubtful debts | 500,000 | |||
Due from franchisees [Member] | ||||
Accounts receivable [Line items] | ||||
Total receivables | 190,000 | 473,000 | ||
Less: allowance for doubtful accounts | -500,000 | |||
Accounts receivable, trade [Member] | ||||
Accounts receivable [Line items] | ||||
Total receivables | 408,000 | 342,000 | ||
Other [Member] | ||||
Accounts receivable [Line items] | ||||
Total receivables | $101,000 | $123,000 | ||
[1] | Does not include approximately $0.5 million in reserve on a note receivable from a franchisee presented in Note 5. Notes Receivable. |
Accounts_Receivable_2_Details
Accounts Receivable 2 (Details) (USD $) | 12 Months Ended | |||||
In Thousands, unless otherwise specified | Dec. 29, 2014 | Dec. 30, 2013 | Dec. 31, 2012 | |||
Reserve for doubtful accounts [Roll Forward] | ||||||
Amount included in reserve on note receivable | $118 | [1] | $344 | [1] | ||
Due from franchisees [Member] | ||||||
Reserve for doubtful accounts [Roll Forward] | ||||||
Amount included in reserve on note receivable | 500 | |||||
Doubtful accounts [Member] | ||||||
Reserve for doubtful accounts [Roll Forward] | ||||||
Balance at the beginning of the period | 794 | 303 | 254 | |||
Charged to costs and expenses | 0 | 491 | [2] | 46 | ||
Deductions | 226 | [3] | 0 | [3] | 3 | [3] |
Balance at the end of the period | $568 | $794 | $303 | |||
[1] | Does not include approximately $0.5 million in reserve on a note receivable from a franchisee presented in Note 5. Notes Receivable. | |||||
[2] | Includes approximately $0.5 million reserve on a note receivable from a franchisee | |||||
[3] | Recovery (write-off) of uncollectible accounts. |
Prepaid_Expenses_and_Other_Cur2
Prepaid Expenses and Other Current Assets (Details) (USD $) | Dec. 29, 2014 | Dec. 30, 2013 |
In Thousands, unless otherwise specified | ||
Prepaid Expenses and Other Current Assets [Abstract] | ||
Prepaid insurance | $1,208 | $1,263 |
Other | 71 | 85 |
Prepaid expenses and other current assets | $1,279 | $1,348 |
Furniture_and_Fixtures_Equipme2
Furniture and Fixtures, Equipment and Leasehold Improvements (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 29, 2014 | Dec. 30, 2013 | Dec. 31, 2012 |
Furniture and fixtures, equipment and leasehold improvements [Line Items] | |||
Total furniture and fixtures, equipment and leasehold improvements | $64,818 | $69,445 | |
Less accumulated depreciation and amortization | -57,510 | -61,250 | |
Furniture and fixtures, equipment and leasehold improvements, net | 7,308 | 8,195 | |
Depreciation and amortization expense | 2,394 | 2,724 | 3,613 |
Leasehold improvements [Member] | |||
Furniture and fixtures, equipment and leasehold improvements [Line Items] | |||
Total furniture and fixtures, equipment and leasehold improvements | 29,481 | 31,361 | |
Furniture and fixtures [Member] | |||
Furniture and fixtures, equipment and leasehold improvements [Line Items] | |||
Total furniture and fixtures, equipment and leasehold improvements | 9,110 | 10,325 | |
Computer and telephone equipment [Member] | |||
Furniture and fixtures, equipment and leasehold improvements [Line Items] | |||
Total furniture and fixtures, equipment and leasehold improvements | 11,231 | 11,492 | |
Restaurant equipment [Member] | |||
Furniture and fixtures, equipment and leasehold improvements [Line Items] | |||
Total furniture and fixtures, equipment and leasehold improvements | 14,957 | 16,228 | |
Vehicles [Member] | |||
Furniture and fixtures, equipment and leasehold improvements [Line Items] | |||
Total furniture and fixtures, equipment and leasehold improvements | $39 | $39 |
Notes_Receivable_Details
Notes Receivable (Details) (USD $) | Dec. 29, 2014 | Dec. 30, 2013 | |
In Thousands, unless otherwise specified | |||
Notes receivable [Line items] | |||
Total notes receivable | $1,001 | $1,001 | |
Less: allowance for doubtful accounts | -450 | [1] | -450 |
Total notes receivable | 551 | 551 | |
Sale of restaurant to a franchisee in 2010 [Member] | |||
Notes receivable [Line items] | |||
Total notes receivable | 925 | 925 | |
Other [Member] | |||
Notes receivable [Line items] | |||
Total notes receivable | $76 | $76 | |
[1] | Denotes a reserve on a note receivable from a franchisee included in the summary of the reserve for doubtful accounts in Note 1. Accounts Receivable. |
Other_Assets_Details
Other Assets (Details) (USD $) | Dec. 29, 2014 | Dec. 30, 2013 |
In Thousands, unless otherwise specified | ||
Other Assets [Abstract] | ||
Security deposits | $721 | $788 |
Deferred financing costs | 312 | |
Trademarks | 195 | 195 |
Liquor licenses | 85 | 85 |
Other | 14 | 47 |
Total other assets | $1,327 | $1,115 |
Accrued_Expenses_Details
Income Taxes 2 (Details) (USD $) | 0 Months Ended | 12 Months Ended | ||||
Dec. 23, 2014 | Jul. 09, 2012 | Jan. 06, 2010 | Dec. 29, 2014 | Dec. 30, 2013 | Dec. 31, 2012 | |
Income Taxes [Abstract] | ||||||
Net operating loss carryforwards for U.S. federal income tax purposes | $243,000,000 | |||||
Reconciliation of the statutory federal income tax rate to the effective tax rate as a percentage of income before income taxes [Abstract] | ||||||
Statutory federal income tax rate (in hundredths) | 35.00% | 35.00% | 35.00% | |||
State income taxes (in hundredths) | 4.60% | 4.60% | 4.60% | |||
Total (in hundredths) | 39.60% | 39.60% | 39.60% | |||
Less valuation allowance (in hundredths) | -39.60% | -39.60% | -39.60% | |||
Effective Tax Rate (in hundredths) | 0.00% | 0.00% | 0.00% | |||
Minimum percentage of stock ownership required to effect ownership change (in hundredths) | 5.00% | 5.00% | 5.00% | 5.00% | ||
Minimum percentage points by which aggregate stock ownership of holders of at least 5% of stock must increase to effect ownership change (in hundredths) | 50.00% | 50.00% | 50.00% | 50.00% | ||
Period over which aggregate stock ownership of holders of at least 5% of stock must increase to effect ownership change | 3 years | 3 years | 3 years | 3 years | ||
Warrants conversion for shares of common stock | $0.01 |
Income_Taxes_Details
Income Taxes 2 (Details) (USD $) | 0 Months Ended | 12 Months Ended | ||||
Dec. 23, 2014 | Jul. 09, 2012 | Jan. 06, 2010 | Dec. 29, 2014 | Dec. 30, 2013 | Dec. 31, 2012 | |
Income Taxes [Abstract] | ||||||
Net operating loss carryforwards for U.S. federal income tax purposes | $243,000,000 | |||||
Reconciliation of the statutory federal income tax rate to the effective tax rate as a percentage of income before income taxes [Abstract] | ||||||
Statutory federal income tax rate (in hundredths) | 35.00% | 35.00% | 35.00% | |||
State income taxes (in hundredths) | 4.60% | 4.60% | 4.60% | |||
Total (in hundredths) | 39.60% | 39.60% | 39.60% | |||
Less valuation allowance (in hundredths) | -39.60% | -39.60% | -39.60% | |||
Effective Tax Rate (in hundredths) | 0.00% | 0.00% | 0.00% | |||
Minimum percentage of stock ownership required to effect ownership change (in hundredths) | 5.00% | 5.00% | 5.00% | 5.00% | ||
Minimum percentage points by which aggregate stock ownership of holders of at least 5% of stock must increase to effect ownership change (in hundredths) | 50.00% | 50.00% | 50.00% | 50.00% | ||
Period over which aggregate stock ownership of holders of at least 5% of stock must increase to effect ownership change | 3 years | 3 years | 3 years | 3 years | ||
Warrants conversion for shares of common stock | $0.01 |
Income_Taxes_2_Details
Income Taxes 2 (Details) (USD $) | 0 Months Ended | 12 Months Ended | ||||
Dec. 23, 2014 | Jul. 09, 2012 | Jan. 06, 2010 | Dec. 29, 2014 | Dec. 30, 2013 | Dec. 31, 2012 | |
Income Taxes [Abstract] | ||||||
Net operating loss carryforwards for U.S. federal income tax purposes | $243,000,000 | |||||
Reconciliation of the statutory federal income tax rate to the effective tax rate as a percentage of income before income taxes [Abstract] | ||||||
Statutory federal income tax rate (in hundredths) | 35.00% | 35.00% | 35.00% | |||
State income taxes (in hundredths) | 4.60% | 4.60% | 4.60% | |||
Total (in hundredths) | 39.60% | 39.60% | 39.60% | |||
Less valuation allowance (in hundredths) | -39.60% | -39.60% | -39.60% | |||
Effective Tax Rate (in hundredths) | 0.00% | 0.00% | 0.00% | |||
Minimum percentage of stock ownership required to effect ownership change (in hundredths) | 5.00% | 5.00% | 5.00% | 5.00% | ||
Minimum percentage points by which aggregate stock ownership of holders of at least 5% of stock must increase to effect ownership change (in hundredths) | 50.00% | 50.00% | 50.00% | 50.00% | ||
Period over which aggregate stock ownership of holders of at least 5% of stock must increase to effect ownership change | 3 years | 3 years | 3 years | 3 years | ||
Warrants conversion for shares of common stock | $0.01 |
Stockholders_Equity_Details
Stockholders' Equity (Details) (USD $) | 0 Months Ended | 12 Months Ended | |||||
In Millions, except Share data, unless otherwise specified | Dec. 23, 2014 | Aug. 22, 2014 | Jul. 09, 2012 | Jan. 06, 2010 | Dec. 29, 2014 | Dec. 30, 2013 | 8-May-13 |
Rights offering and private placement of common stock [Line Items] | |||||||
Number of shares of common stock issued (in shares) | 13,300,000 | 3,900,000 | |||||
Par value of common stock issued (in dollars per share) | $0.01 | $0.01 | $0.01 | ||||
Net proceeds from the rights offering and private placement of common stock | $19.70 | $12.60 | |||||
Minimum percentage of stock ownership required to effect ownership change (in hundredths) | 5.00% | 5.00% | 5.00% | 5.00% | |||
Minimum percentage points by which aggregate stock ownership of holders of at least 5% of stock must increase to effect ownership change (in hundredths) | 50.00% | 50.00% | 50.00% | 50.00% | |||
Period over which aggregate stock ownership of holders of at least 5% of stock must increase to effect ownership change | 3 years | 3 years | 3 years | 3 years | |||
Rights offering [Member] | |||||||
Rights offering and private placement of common stock [Line Items] | |||||||
Number of shares of common stock issued (in shares) | 13,333,329 | 4,915,461 | |||||
Par value of common stock issued (in dollars per share) | $0.01 | $0.01 | |||||
Subscription price (in dollars per share) | $1.50 | $2.60 | |||||
Private placement [Member] | |||||||
Rights offering and private placement of common stock [Line Items] | |||||||
Number of shares of common stock issued (in shares) | 633,581 | ||||||
Par value of common stock issued (in dollars per share) | $0.01 | ||||||
Subscription price (in dollars per share) | $2.60 |
Stockholders_Equity_2_Details
Stockholders' Equity, 2 (Details) (USD $) | 0 Months Ended | |||
Aug. 22, 2014 | Dec. 29, 2014 | Dec. 30, 2013 | 8-May-13 | |
Stock Purchase Agreement [Line Items] | ||||
Common stock, par value (in dollars per share) | $0.01 | $0.01 | $0.01 | |
Plaisance Fund, LP [Member] | ||||
Stock Purchase Agreement [Line Items] | ||||
Sale of unregistered shares of common stock (in shares) | 3,367,874 | |||
Common stock, par value (in dollars per share) | $0.01 | |||
Common stock, purchase price (in dollars per shares) | $1.15 | |||
Aggregate purchase price of common stock | $3,873,055 | |||
Lloyd I. Miller Trust C [Member] | ||||
Stock Purchase Agreement [Line Items] | ||||
Sale of unregistered shares of common stock (in shares) | 521,739 | |||
Common stock, par value (in dollars per share) | $0.01 | |||
Common stock, purchase price (in dollars per shares) | $1.15 | |||
Aggregate purchase price of common stock | $600,000 |
Stockholders_Equity_3_Details
Stockholders' Equity, 3 (Details) (USD $) | 0 Months Ended | 12 Months Ended | 0 Months Ended | ||||
8-May-13 | Dec. 29, 2014 | Apr. 14, 2014 | Oct. 14, 2014 | 20-May-14 | Sep. 16, 2014 | Dec. 30, 2013 | |
Senior Secured Promissory Notes [Line Items] | |||||||
Warrants outstanding (in shares) | 550,000 | ||||||
Fair value of warrants | $700,000 | ||||||
Black-Scholes model using the following assumptions [Abstract] | |||||||
Issuance of stock warrants | 500,000 | ||||||
Debt issuance costs | 446,000 | ||||||
Reverse Common Stock Split [Abstract] | |||||||
Reverse split of its common stock | one-for-four | ||||||
Par value of common stock issued (in dollars per share) | $0.01 | $0.01 | $0.01 | ||||
Senior Secured Promissory Note [Member] | |||||||
Senior Secured Promissory Notes [Line Items] | |||||||
Face amount | 5,000,000 | ||||||
Interest rate (in hundredths) | 9.00% | ||||||
Number of initial semi-annual interest payments may be paid in kind | 2 | ||||||
Paid-in-kind interest rate (in hundredths) | 11.00% | ||||||
Maturity term | 3 years | ||||||
Finance fee (in hundredths) | 3.50% | ||||||
Shares issuable upon exercise of warrant (in shares) | 1,100,000 | ||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights (in dollars per share) | $0.01 | ||||||
Ownership rate that may not be exceeded (in hundredths) | 19.90% | ||||||
Maximum amount of obligation | 4,000,000 | ||||||
AB Note Purchase Agreement [Member] | |||||||
Senior Secured Promissory Notes [Line Items] | |||||||
Face amount | 2,500,000 | ||||||
Interest rate (in hundredths) | 9.00% | ||||||
Number of initial semi-annual interest payments may be paid in kind | 2 | ||||||
Paid-in-kind interest rate (in hundredths) | 11.00% | ||||||
Finance fee (in hundredths) | 3.50% | ||||||
Number of warrants issued (in shares) | 550,000 | ||||||
Shares issuable upon exercise of warrant (in shares) | 550,000 | ||||||
Number of shares forfeited to pay for the warrants in lieu of cash (in shares) | 2,895 | ||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights (in dollars per share) | $0.01 | ||||||
Ownership rate that may not be exceeded (in hundredths) | 19.90% | ||||||
Black-Scholes model using the following assumptions [Abstract] | |||||||
Expected life | 3 years | ||||||
Volatility (in hundredths) | 63.86% | ||||||
Risk Free interest rate (in hundredths) | 0.82% | ||||||
Dividend yield (on common stock) (in hundredths) | 0.00% | ||||||
MILFAM II Note Agreement [Member] | |||||||
Senior Secured Promissory Notes [Line Items] | |||||||
Number of warrants issued (in shares) | 1,100,000 | ||||||
Exercise of warrants to purchase common stock (in shares) | 1,100,000 | ||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights (in dollars per share) | $0.01 | ||||||
Aggregate purchase price of warrants | 11,000 | ||||||
Fair value of warrants | 1,300,000 | ||||||
Black-Scholes model using the following assumptions [Abstract] | |||||||
Expected life | 3 years | ||||||
Volatility (in hundredths) | 63.86% | ||||||
Risk Free interest rate (in hundredths) | 0.82% | ||||||
Dividend yield (on common stock) (in hundredths) | 0.00% | ||||||
Issuance of stock warrants | $1,000,000 |
StockBased_Employee_Compensati2
Stock-Based Employee Compensation (Details) (USD $) | 12 Months Ended | |||
In Millions, except Share data, unless otherwise specified | Dec. 29, 2014 | Dec. 30, 2013 | Dec. 31, 2012 | 2-May-05 |
Stock-based compensation expense [Line Items] | ||||
Number of shares authorized (in shares) | 925,000 | |||
Increase in number of shares available for issuance under the Plan (in shares) | 1,500,000 | 375,000 | ||
Number of shares reserved for issuance under the Omnibus Plan (in shares) | 1,600,000 | |||
Maturity period under the Omnibus Plan | 10 years | |||
Restricted shares issued (in shares) | 1,510,765 | 85,512 | 43,103 | |
Employee [Member] | ||||
Stock-based compensation expense [Line Items] | ||||
Number of shares reserved for issuance under the Omnibus Plan (in shares) | 400,000 | |||
Restricted shares issued (in shares) | 1,400,000 | |||
Unregistered shares (in shares) | 1,000,000 | |||
Employee Stock Option [Member] | ||||
Stock-based compensation expense [Line Items] | ||||
Unrecognized compensation expense related to stock options | 1 | |||
Minimum [Member] | ||||
Stock-based compensation expense [Line Items] | ||||
Period over which awards vest | 4 years | |||
Maximum [Member] | ||||
Stock-based compensation expense [Line Items] | ||||
Period over which awards vest | 5 years |
StockBased_Employee_Compensati3
Stock-Based Employee Compensation 2 (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 29, 2014 | Dec. 30, 2013 | Dec. 31, 2012 |
Stock-based compensation expense [Line Items] | |||
Total non-cash, stock-based compensation expense, net of forfeitures | $509 | $128 | $399 |
Stock options [Member] | |||
Stock-based compensation expense [Line Items] | |||
Total non-cash, stock-based compensation expense, net of forfeitures | 0 | 7 | 0 |
Restricted stock and restricted stock units [Member] | |||
Stock-based compensation expense [Line Items] | |||
Total non-cash, stock-based compensation expense, net of forfeitures | $509 | $121 | $399 |
StockBased_Employee_Compensati4
Stock-Based Employee Compensation 3 (Details) (USD $) | 12 Months Ended | |||
Dec. 29, 2014 | Dec. 30, 2013 | Dec. 31, 2012 | Jan. 02, 2012 | |
Stock-based compensation expense, additional disclosures [Abstract] | ||||
Aggregate fair value of options vested | $70,000 | |||
Options [Member] | ||||
Number of Options [Roll Forward] | ||||
Outstanding at the beginning of the period (in shares) | 53,515 | 38,553 | 41,071 | |
Granted (in shares) | 0 | 25,000 | 0 | |
Exercised (in shares) | 0 | 0 | 0 | |
Cancelled/Expired (in shares) | -47,052 | -10,038 | -2,518 | |
Outstanding at the end of the period (in shares) | 6,463 | 53,515 | 38,553 | 41,071 |
Exercisable at the end of the period (in shares) | 3,750 | |||
Weighted Average Exercise Price [Roll Forward] | ||||
Outstanding at the beginning of the period (in dollars per share) | $12.05 | $20.40 | $20 | |
Granted (in dollars per share) | $0 | $2.80 | $0 | |
Exercised (in dollars per share) | $0 | $0 | $0 | |
Cancelled/Expired (in dollars per share) | $28.83 | $21.02 | $13.88 | |
Outstanding at the end of the period (in dollars per share) | $3.62 | $12.05 | $20.40 | $20 |
Exercisable at the end of the period (in dollars per share) | $2.80 | |||
Weighted Average Remaining Contractual Term [Abstract] | ||||
Outstanding at the end of the period | 2 years 2 months 12 days | 3 years 10 months 24 days | 1 year 8 months 12 days | 2 years 6 months |
Exercisable at the end of the period | 2 years 2 months 12 days | |||
Aggregate Intrinsic Value [Abstract] | ||||
Outstanding at the end of the period | 0 | 0 | 0 | 0 |
Cancelled/Expired | 0 | 0 | 0 | |
Exercisable at the end of the period | $0 |
StockBased_Employee_Compensati5
Stock-Based Employee Compensation 4 (Details) ($2.80 - $27.76 [Member], USD $) | 12 Months Ended |
Dec. 29, 2014 | |
$2.80 - $27.76 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of Exercise Prices, minimum (in dollars per share) | $2.80 |
Range of Exercise Prices, maximum (in dollars per share) | $27.76 |
Options Outstanding [Abstract] | |
Number of Options Outstanding (in shares) | 6,463 |
Remaining Contractual Life | 2 years 2 months 12 days |
Exercise Price (in dollars per share) | $3.62 |
Options Exercisable [Abstract] | |
Number of Options Exercisable (in shares) | 3,750 |
Exercise Price (in dollars per share) | $2.80 |
StockBased_Employee_Compensati6
Stock-Based Employee Compensation 5 (Details) (USD $) | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Dec. 29, 2014 | Dec. 30, 2013 | Dec. 31, 2012 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Conversion of units into common stock (in shares) | 91,250 | ||
Number of shares reserved for issuance under the Omnibus Plan (in shares) | 1,600,000 | ||
Number of Shares [Roll Forward] | |||
Non-vested at the beginning of the period (in shares) | 11,325 | 271,400 | 322,100 |
Granted and issued (in shares) | 1,510,765 | 85,512 | 43,103 |
Vested (in shares) | 125,000 | 88,862 | 80,340 |
Forfeited / Canceled (in shares) | -79,575 | -256,725 | -13,463 |
Non-vested at the end of the period (in shares) | 1,317,515 | 11,325 | 271,400 |
Weighted Average Grant-Date Fair Value [Roll Forward] | |||
Non-vested at the beginning of the period (in dollars per share) | $4.08 | $2.96 | $3.08 |
Granted (in dollars per share) | $0.92 | $2.91 | $3.48 |
Vested (in dollars per share) | $0.99 | $3 | $3.56 |
Forfeited / Canceled (in dollars per share) | $1.10 | $2.88 | $4.68 |
Non-vested at the end of the period (in dollars per share) | $0.95 | $4.08 | $2.96 |
Key employees [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Restricted shares granted (in shares) | 30,000 | ||
Members of the Board of Directors [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Value of the shares for the grants made during period | $0.10 | $0.10 | $0.10 |
Number of Shares [Roll Forward] | |||
Granted and issued (in shares) | 76,601 | 55,512 | 43,103 |
Performance-Vested Shares [Member] | Key employees [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting percentage on grant date (in hundredths) | 50.00% | ||
Performance-Vested Shares [Member] | Chief Executive Officer and President [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of installments in which restricted common stock vest | 4 | ||
Performance-Vested Shares [Member] | Chief Executive Officer and President [Member] | Closing Price $2.00 [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting percentage on each specified closing price (in hundredths) | 25.00% | ||
Closing price (in dollars per share) | $2 | ||
Consecutive trading days | 30 | ||
Performance-Vested Shares [Member] | Chief Executive Officer and President [Member] | Closing Price $2.50 [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Closing price (in dollars per share) | $2.50 | ||
Consecutive trading days | 30 | ||
Performance-Vested Shares [Member] | Chief Executive Officer and President [Member] | Closing Price $3.00 [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting percentage on each specified closing price (in hundredths) | 25.00% | ||
Closing price (in dollars per share) | $3 | ||
Consecutive trading days | 30 | ||
Performance-Vested Shares [Member] | Chief Executive Officer and President [Member] | Closing Price $4.00 [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting percentage on each specified closing price (in hundredths) | 25.00% | ||
Closing price (in dollars per share) | $4 | ||
Consecutive trading days | 30 | ||
Performance-Vested Shares [Member] | Board of Director Members and Employees [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Restricted shares granted (in shares) | 1,512,745 | ||
Time Vested Shares [Member] | Key employees [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting percentage on grant date (in hundredths) | 50.00% | ||
Time Vested Shares [Member] | Chief Executive Officer and President [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Additional vesting percentage on each anniversary of the grant date (in hundredths) | 25.00% | ||
Number of installments in which restricted common stock vest | 4 | ||
Restricted stock units [Member] | Board of Director Members and Employees [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Unregistered shares (in shares) | 974,164 | ||
Number of shares reserved for issuance under the Omnibus Plan (in shares) | 536,601 | ||
Restricted stock and restricted stock units [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Value of the shares for the grants made during period | 1.4 | 0.1 | |
Value of the forfeited shares | $0.80 | $0.70 | $0.05 |
Number of Shares [Roll Forward] | |||
Forfeited / Canceled (in shares) | -79,575 | -256,725 | -13,463 |
Defined_Contribution_Plan_Deta
Defined Contribution Plan (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 30, 2013 | Dec. 31, 2012 |
Defined Contribution Plan [Abstract] | ||
Matching employer contribution under 401(k) Plan (in hundredths) | 50.00% | 50.00% |
Percentage of eligible compensation matched by employer (in hundredths) | 4.00% | 4.00% |
Period for completion of employment for employer contribution made during the employee's first year of employment | 1 year | 1 year |
Maximum deferred amount as a percentage of individual participant's compensation (in hundredths) | 20.00% | 20.00% |
Contributions to the Plan | $0.10 | $0.10 |
Commitments_and_Contingencies_1
Commitments and Contingencies (Details) (USD $) | 12 Months Ended | ||
Dec. 29, 2014 | Dec. 30, 2013 | Dec. 31, 2012 | |
Minimum annual rentals [Abstract] | |||
2015 | $10,777,000 | ||
2016 | 8,626,000 | ||
2017 | 5,956,000 | ||
2018 | 4,521,000 | ||
2019 | 3,861,000 | ||
Thereafter | 18,359,000 | ||
Total | 52,100,000 | ||
Sublease rental income | 100,000 | ||
Rental expense | 11,600,000 | 12,600,000 | 13,100,000 |
Amounts incurred under additional rent provisions and agreements | $200,000 | $200,000 | $200,000 |
Commitments_and_Contingencies_2
Commitments and Contingencies 2 (Details) (Restaurant leaseholds [Member], USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 29, 2014 | Dec. 30, 2013 | Dec. 31, 2012 |
Commitments and contingencies [Line Items] | |||
Contractual obligation | 1.1 | $1.70 | $2.10 |
Landlord allowances presented as a long-term liability in other liabilities | 0.1 | 0.2 | 0.5 |
Minimum [Member] | |||
Commitments and contingencies [Line Items] | |||
Renewal option, period | 3 years | ||
Maximum [Member] | |||
Commitments and contingencies [Line Items] | |||
Renewal option, period | 5 years | ||
Terminated operating leases [Member] | |||
Commitments and contingencies [Line Items] | |||
Contractual obligation | 0.2 | ||
Future minimum lease payments | 0.3 | ||
Contractual obligation, current | 0.1 | ||
Terminated operating leases [Member] | Minimum [Member] | |||
Commitments and contingencies [Line Items] | |||
Operating lease, remaining term | 1 year | ||
Terminated operating leases [Member] | Maximum [Member] | |||
Commitments and contingencies [Line Items] | |||
Operating lease, remaining term | 3 years | ||
Standby letters of credit [Member] | |||
Commitments and contingencies [Line Items] | |||
Letters of credit provided as security deposits | 0.4 |
Commitments_and_Contingencies_3
Commitments and Contingencies 3 (Details) (USD $) | 12 Months Ended | 1 Months Ended | ||
Dec. 29, 2014 | Dec. 30, 2013 | Dec. 31, 2012 | Apr. 30, 2015 | |
Self-Insurance [Abstract] | ||||
Self-insured group health insurance plan, maximum coverage per participant | $100,000 | |||
Self-insured group health insurance plan, maximum additional coverage per plan year | 50,000 | |||
Self-insurance reserve account | 100,000 | 200,000 | ||
Pre-determined dollar amount | 1,400,000 | |||
Health insurance expense | $800,000 | $1,500,000 | $1,400,000 | |
Subsequent Event [Member] | ||||
Purchase Commitments [Abstract] | ||||
Term period of agreement | 3 years | |||
Cost of goods sold [Member] | Supplier concentration [Member] | Food and paper products [Member] | ||||
Purchase Commitments [Abstract] | ||||
Percentage of food and paper products to be supplied by independent distributors (in hundredths) | 76.00% |
Commitments_and_Contingencies_4
Commitments and Contingencies 4 (Details) (USD $) | 12 Months Ended |
Dec. 29, 2014 | |
Notice of Compliance with Nasdaq Listing Standards [Abstract] | |
Minimum level of stockholders equity required for continued listing on Nasdaq Capital Market | $2,500,000 |
Minimum market value in listed securities required for continued listing on Nasdaq Capital Market | 35,000,000 |
Minimum net income from continued operations required for continued listing on Nasdaq Capital Market | $500,000 |
Number of consecutive days considered for market value in listed securities required for continued listing on Nasdaq Capital Market | 10 days |
Subsequent_Events_Details
Subsequent Events (Details) (Hearthstone Associates, LLC [Member], USD $) | 0 Months Ended | ||||||||
Mar. 18, 2014 | Jun. 01, 2013 | Mar. 20, 2009 | Jan. 29, 2014 | 9-May-13 | Jan. 26, 2015 | Jan. 29, 2015 | Dec. 29, 2014 | Mar. 31, 2015 | |
Subsequent Event [Line Items] | |||||||||
Common shares issuable in Hearthstone merger agreement (in shares) | 1,790,993 | ||||||||
Promissory Note [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Principal payment | $500,000 | ||||||||
Partner Note [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Interest rate (in hundredths) | 5.00% | ||||||||
Debt instrument maturity date | 30-Mar-16 | ||||||||
Interest on past due principal and interest | 12.00% | ||||||||
Term Note [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Principal payment | 3,300,000 | ||||||||
Private Investor Notes [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Principal payment | 1,500,000 | ||||||||
Outstanding principal indebtedness | 2,000,000 | ||||||||
Debt instrument maturity date | 31-May-16 | ||||||||
Interest on past due principal and interest | 18.00% | ||||||||
Minimum gross sale proceeds | 20,000,000 | ||||||||
Gross sale proceeds percentage (in hundredths) | 5.00% | ||||||||
Private Investor Notes [Member] | LIBOR [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Debt instrument variable interest rate description | LIBOR plus eight percent (8%) per annum | ||||||||
Debt instrument variable interest rate | 8.00% | ||||||||
New Restaurant Loans [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Outstanding principal indebtedness | 800,000 | ||||||||
FFCC Notes [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Principal payment | 5,400,000 | ||||||||
Maturity term | 60 months | ||||||||
Interest rate (in hundredths) | 5.93% | ||||||||
Payment of principal and interest | 60,000 | ||||||||
Balloon payment | 3,200,000 | ||||||||
Late fee percentage on past due | 10.00% | ||||||||
Late fee percentage on past due after maturity date | 5.00% | ||||||||
Prepayment fee percentage on outstanding principal balance | 4.00% | ||||||||
Prepayment fee percentage after maturity | 1.00% | ||||||||
Cash collateral pledged | 5,000,000 | ||||||||
Finance fee (in hundredths) | 1.00% | ||||||||
June 30, 2011, Through March 30, 2012 [Member] | Partner Note [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Principal payment | 30,000 | ||||||||
June 30, 2012 Through December 30, 2015 [Member] | Partner Note [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Principal payment | 60,000 | ||||||||
Subsequent Event [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Total assets | 4,800,000 | ||||||||
Property and equipment | 3,900,000 | ||||||||
Total liabilities | 9,400,000 | ||||||||
Indebtedness | 7,500,000 | ||||||||
Outstanding principal indebtedness | 10,700,000 | ||||||||
Subsequent Event [Member] | Partner Note [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Outstanding principal indebtedness | 3,300,000 | ||||||||
Subsequent Event [Member] | New Restaurant Loans [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Borrowings | 1,000,000 | ||||||||
Subsequent Event [Member] | FFCC Notes [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Outstanding principal indebtedness | $4,800,000 |