Cover
Cover - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 26, 2021 | Feb. 20, 2022 | Jun. 27, 2021 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 26, 2021 | ||
Current Fiscal Year End Date | --12-26 | ||
Document Transition Report | false | ||
Entity File Number | 001-36104 | ||
Entity Registrant Name | POTBELLY CORPORATION | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 36-4466837 | ||
Entity Address, Address Line One | 111 N. Canal Street | ||
Entity Address, Address Line Two | Suite 325 | ||
Entity Address, City or Town | Chicago | ||
Entity Address, State or Province | IL | ||
Entity Address, Postal Zip Code | 60606 | ||
City Area Code | 312 | ||
Local Phone Number | 951-0600 | ||
Title of 12(b) Security | Common Stock, $0.01 par value | ||
Trading Symbol | PBPB | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
ICFR Auditor Attestation Flag | false | ||
Entity Public Float | $ 247.5 | ||
Entity Common Stock, Shares Outstanding | 28,761,080 | ||
Documents Incorporated by Reference | Portions of the registrant’s definitive proxy statement for its 2022 Annual Meeting to be filed with the Securities and Exchange Commission not later than 120 days after the end of the year covered by this Annual Report are incorporated by reference into Part III of this Annual Report. | ||
Entity Central Index Key | 0001195734 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2021 | ||
Amendment Flag | false |
Audit Information
Audit Information | 12 Months Ended |
Dec. 26, 2021 | |
Auditor Information [Abstract] | |
Auditor Location | Chicago, Illinois |
Auditor Name | Deloitte & Touche LLP |
Auditor Firm ID | 34 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 26, 2021 | Dec. 27, 2020 |
Current assets | ||
Cash and cash equivalents, at carrying value | $ 14,353 | $ 11,126 |
Accounts receivable, net of allowances of $27 and $47 as of December 26, 2021 and December 27, 2020, respectively | 6,032 | 4,354 |
Inventories | 3,491 | 2,989 |
Prepaid expenses and other current assets | 4,178 | 4,839 |
Total current assets | 28,054 | 23,308 |
Property and equipment, net | 49,805 | 61,193 |
Right-of-use assets for operating leases | 166,084 | 189,141 |
Indefinite-lived intangible assets | 3,404 | 3,404 |
Goodwill | 2,222 | 2,222 |
Deferred expenses, net and other assets | 3,668 | 4,089 |
Total assets | 253,237 | 283,357 |
Current liabilities | ||
Accounts payable | 8,140 | 7,511 |
Accrued expenses | 30,859 | 22,437 |
Current portion of long-term debt | 2,333 | 333 |
Short-term operating lease liabilities | 28,548 | 35,325 |
Total current liabilities | 69,880 | 65,606 |
Long-term debt, net of current portion | 17,517 | 15,953 |
Long-term operating lease liabilities | 166,291 | 189,146 |
Other long-term liabilities | 1,966 | 7,157 |
Total liabilities | 255,654 | 277,862 |
Commitments and contingencies (Note 14) | ||
Equity | ||
Common stock, $0.01 par value—authorized 200,000 shares; outstanding 28,380 and 24,323 shares as of December 26, 2021 and December 27, 2020, respectively | 380 | 339 |
Warrants | 2,566 | 0 |
Additional paid-in-capital | 452,570 | 438,174 |
Treasury stock, held at cost, 9,785 and 9,612 shares as of December 26, 2021, and December 27, 2020, respectively | (114,577) | (113,266) |
Accumulated deficit | (343,261) | (319,477) |
Total stockholders’ equity (deficit) | (2,322) | 5,770 |
Non-controlling interest | (95) | (275) |
Total equity (deficit) | (2,417) | 5,495 |
Total liabilities and equity (deficit) | $ 253,237 | $ 283,357 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 26, 2021 | Dec. 27, 2020 |
Current assets | ||
Accounts receivable, allowance | $ 27 | $ 47 |
Equity | ||
Common stock, outstanding (in shares) | 28,380,000 | 24,323,000 |
Common stock, authorized (in shares) | 200,000,000 | 200,000,000 |
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Treasury stock, shares (in shares) | 9,785,000 | 9,612,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 26, 2021 | Dec. 27, 2020 | Dec. 29, 2019 | |
Revenues | |||
Revenues | $ 380,052 | $ 291,281 | $ 409,707 |
Sandwich shop operating expenses, excluding depreciation | |||
Labor and related expenses | 127,099 | 105,241 | 128,403 |
Occupancy expenses | 53,821 | 56,882 | 58,977 |
Other operating expenses | 59,265 | 49,054 | 50,178 |
Advertising | 2,999 | 1,020 | 4,111 |
General and administrative expenses | 33,287 | 33,989 | 40,720 |
Depreciation expense | 15,909 | 19,830 | 22,103 |
Pre-opening costs | 0 | 229 | 35 |
Impairment, loss on disposal of property and equipment and shop closures | 5,125 | 12,346 | 6,050 |
Restructuring costs | 0 | 1,668 | 0 |
Total expenses | 402,540 | 362,413 | 418,903 |
Loss from operations | (22,488) | (71,132) | (9,196) |
Interest expense | 963 | 1,076 | 199 |
Total | (23,451) | (72,208) | (9,395) |
Income Tax Expense (Benefit) | 172 | (6,536) | 14,190 |
Net loss | (23,623) | (65,672) | (23,585) |
Net income (loss) attributable to non-controlling interest | 161 | (281) | 407 |
Net loss attributable to Potbelly Corporation | $ (23,784) | $ (65,391) | $ (23,992) |
Net loss per common share attributable to common stockholders: | |||
Basic (in usd per share) | $ (0.86) | $ (2.74) | $ (1.01) |
Diluted (in usd per share) | $ (0.86) | $ (2.74) | $ (1.01) |
Weighted average shares outstanding: | |||
Basic (in shares) | 27,640,000 | 23,899,000 | 23,850,000 |
Diluted (in shares) | 27,640,000 | 23,899,000 | 23,850,000 |
Product | |||
Revenues | |||
Revenues | $ 377,283 | $ 289,337 | $ 406,688 |
Sandwich shop operating expenses, excluding depreciation | |||
Food, beverage and packaging costs | 105,035 | 82,154 | 108,326 |
Franchise Royalties And Fees | |||
Revenues | |||
Revenues | $ 2,769 | $ 1,944 | $ 3,019 |
Consolidated Statements of Equi
Consolidated Statements of Equity - USD ($) $ in Thousands | Total | Cumulative Effect, Period of Adoption, AdjustmentRevision of Prior Period, Adjustment | Common Stock | Treasury Stock | Warrants | Additional Paid-In- Capital | Accumulated Deficit | Accumulated DeficitCumulative Effect, Period of Adoption, AdjustmentRevision of Prior Period, Adjustment | Non- Controlling Interest |
Cumulative impact of accounting standards update | $ 95,533 | $ 330 | $ (108,372) | $ 0 | $ 432,771 | $ (229,558) | $ 362 | ||
Cumulative impact of accounting standards update | ASU 2016-02 (Topic 842) | $ (531) | $ (531) | |||||||
Beginning balance at Dec. 30, 2018 | 95,533 | $ 330 | (108,372) | 0 | 432,771 | (229,558) | 362 | ||
Beginning balance (ASU 2016-02 (Topic 842)) at Dec. 30, 2018 | (531) | (531) | |||||||
Balance, beginning period (in shares) at Dec. 30, 2018 | 24,143,000 | ||||||||
Net income (loss) | (23,585) | (23,992) | 407 | ||||||
Stock-based compensation plans | 82 | $ 1 | (91) | 172 | |||||
Stock-based compensation plans (in shares) | 143,000 | ||||||||
Shares issued for proxy-related expenses | (4,217) | (4,217) | |||||||
Repurchases of common stock (in shares) | 648,000 | ||||||||
Distributions to non-controlling interest | (523) | (523) | |||||||
Contributions from non-controlling interest | 75 | 75 | |||||||
Stock-based compensation expense | 2,335 | 2,335 | |||||||
Ending balance at Dec. 29, 2019 | 69,169 | $ 331 | (112,680) | 0 | 435,278 | (254,081) | 321 | ||
Ending balance (ASU 2016-13 (Topic 326)) at Dec. 29, 2019 | (5) | (5) | |||||||
Balance, ending period (in shares) at Dec. 29, 2019 | 23,638,000 | ||||||||
Cumulative impact of accounting standards update | 69,169 | $ 331 | (112,680) | 0 | 435,278 | (254,081) | 321 | ||
Cumulative impact of accounting standards update | ASU 2016-13 (Topic 326) | $ (5) | $ (5) | |||||||
Net income (loss) | (65,672) | (65,391) | (281) | ||||||
Stock-based compensation plans | (586) | $ 7 | (586) | (7) | |||||
Stock-based compensation plans (in shares) | 555,000 | ||||||||
Shares issued for proxy-related expenses | 389 | $ 1 | 388 | ||||||
Shares issued for proxy-related expenses (in shares) | 130,000 | ||||||||
Distributions to non-controlling interest | (458) | (458) | |||||||
Contributions from non-controlling interest | 143 | 143 | |||||||
Stock-based compensation expense | 2,515 | 2,515 | |||||||
Ending balance at Dec. 27, 2020 | $ 5,495 | $ 339 | (113,266) | 0 | 438,174 | (319,477) | (275) | ||
Balance, ending period (in shares) at Dec. 27, 2020 | 24,323,000 | 24,323,000 | |||||||
Cumulative impact of accounting standards update | $ 5,495 | $ 339 | (113,266) | 0 | 438,174 | (319,477) | (275) | ||
Net income (loss) | (23,623) | (23,784) | 161 | ||||||
Stock-based compensation plans | (1,311) | $ 9 | (1,311) | (9) | |||||
Stock-based compensation plans (in shares) | 807,000 | ||||||||
Proceeds from exercise of stock options | 219 | 219 | |||||||
Issuances of common shares and warrants, net of fees | 14,839 | $ 32 | 2,566 | 12,241 | |||||
Issuance of common stock (in shares) | 3,250,000 | ||||||||
Distributions to non-controlling interest | (189) | (189) | |||||||
Contributions from non-controlling interest | 208 | 208 | |||||||
Offering costs for "at the market" equity sales agreement | (192) | (192) | |||||||
Stock-based compensation expense | 2,137 | 2,137 | |||||||
Ending balance at Dec. 26, 2021 | $ (2,417) | $ 380 | (114,577) | 2,566 | 452,570 | (343,261) | (95) | ||
Balance, ending period (in shares) at Dec. 26, 2021 | 28,380,000 | 28,380,000 | |||||||
Cumulative impact of accounting standards update | $ (2,417) | $ 380 | $ (114,577) | $ 2,566 | $ 452,570 | $ (343,261) | $ (95) |
Consolidated Statements of Eq_2
Consolidated Statements of Equity (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 27, 2020 | Dec. 29, 2019 | |
Net income (loss) | $ (65,672) | $ (23,585) |
Accumulated Deficit | ||
Net income (loss) | (65,391) | (23,992) |
Non- Controlling Interest | ||
Net income (loss) | (281) | 407 |
ASU 2016-02 (Topic 842) | ||
Cumulative impact tax | $ 196 | |
ASU 2016-13 (Topic 326) | ||
Cumulative impact tax | $ 2 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 26, 2021 | Dec. 27, 2020 | Dec. 29, 2019 | |
Cash flows from operating activities: | |||
Net income (loss) | $ (23,623) | $ (65,672) | $ (23,585) |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||
Depreciation expense | 15,909 | 19,830 | 22,103 |
Noncash lease expense | 25,856 | 26,579 | 27,853 |
Deferred income tax | 18 | 10 | 13,808 |
Stock-based compensation expense | 2,137 | 2,515 | 2,335 |
Asset impairment, store closure and disposal of property and equipment | 4,572 | 9,440 | 1,829 |
Other operating activities | 305 | 723 | 55 |
Changes in operating assets and liabilities: | |||
Accounts receivable, net | (1,677) | (35) | 480 |
Inventories | (502) | 484 | 9 |
Prepaid expenses and other assets | 1,083 | 617 | 5,917 |
Accounts payable | 326 | 3,621 | (174) |
Operating lease liabilities | (32,932) | (15,895) | (28,565) |
Accrued expenses and other liabilities | 3,655 | 6,174 | (3,897) |
Net cash (used in) provided by operating activities | (4,873) | (11,609) | 18,168 |
Cash flows from investing activities: | |||
Purchases of property and equipment | (9,048) | (10,920) | (14,365) |
Net cash used in investing activities | (9,048) | (10,920) | (14,365) |
Cash flows from financing activities: | |||
Borrowings under Credit Facility | 38,000 | 61,286 | 0 |
Repayments under Credit Facility | (34,436) | (55,000) | 0 |
Proceeds from Paycheck Protection Program loan | 0 | 10,000 | 0 |
Payment of debt issuance costs | (195) | (538) | (189) |
Proceeds from issuance of common shares and warrants, net of fees | 14,839 | 0 | 0 |
Proceeds from exercise of stock options | 219 | 0 | 173 |
Proceeds from exercise of stock options | (1,298) | (584) | (91) |
Treasury stock repurchase | 0 | 0 | (4,217) |
Distributions to non-controlling interest | (189) | (458) | (523) |
Contributions from non-controlling interest | 208 | 143 | 75 |
Net cash provided by (used in) financing activities | 17,148 | 14,849 | (4,772) |
Net increase (decrease) in cash and cash equivalents | 3,227 | (7,680) | (969) |
Cash and cash equivalents at beginning of period | 11,126 | 18,806 | 19,775 |
Cash and cash equivalents at end of period | 14,353 | 11,126 | 18,806 |
Supplemental cash flow information: | |||
Income taxes paid | 185 | 206 | 187 |
Interest paid | 608 | 896 | 108 |
Supplemental non-cash investing and financing activities: | |||
Unpaid liability for purchases of property and equipment | 460 | 801 | 1,198 |
Unpaid liability for employee taxes on certain stock-based arrangements | $ 13 | $ 0 | $ 0 |
Organization and Other Matters
Organization and Other Matters | 12 Months Ended |
Dec. 26, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Other Matters | Organization and Other Matters Business Potbelly Corporation, a Delaware corporation, together with its subsidiaries (collectively referred to as “the Company,” “Potbelly,” “we,” “us”, or “our”), owns and operates 397 company-owned shops in the United States as of December 26, 2021. Additionally, Potbelly franchisees operate over 46 shops domestically. Basis of Presentation Beginning with the first quarter of 2021, advertising expenses are presented separately on the consolidated statements of operation. Prior to the first quarter of 2021, advertising expenses were presented within general and administrative expenses. Prior period amounts have been reclassified to conform to the current presentation. This reclassification had no impact on our results of operations, financial position or cash flows. We do not have any components of other comprehensive income recorded within our consolidated financial statements and therefore, do not separately present a statement of comprehensive income in our consolidated financial statements. COVID-19 On January 30, 2020, the World Health Organization (“WHO”) announced a global health emergency because of a new strain of coronavirus ("COVID-19") and the risks to the international community as the virus spreads globally. On March 11, 2020, the WHO classified the COVID-19 outbreak as a pandemic, based on the rapid increase in exposure globally. In response to the pandemic, many states and jurisdictions in which we operate issued stay-at-home orders and other measures aimed at slowing the spread of the coronavirus, resulting in significant changes to our operations and a sudden and drastic decrease in revenues. While the pandemic continues to have an impact on our business, the distribution of COVID-19 vaccines and lifting of local restrictions resulted in a gradual improvement to our sales during 2021. Nearly all of our shops have reopened their dining rooms and are no longer subject to the operating restrictions and capacity limits related to COVID-19. We will continue to follow guidance from local authorities in determining the appropriate restrictions to put in place for each shop, including mask mandates, hours of operation, and the suspension or reduction of in-shop dining if required due to changes in the pandemic response in each jurisdiction and restaurant operating protocols, which could result in lower in-shop dining revenue or higher operating costs. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 26, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies (a) Principles of Consolidation The consolidated financial statements include the accounts of Potbelly Corporation; its wholly owned subsidiary, Potbelly Illinois, Inc. (“PII”); PII’s wholly owned subsidiaries, Potbelly Franchising, LLC and Potbelly Sandwich Works LLC (“LLC”); seven of LLC’s wholly owned subsidiaries and LLC’s six joint ventures, collectively, the “Company.” All intercompany balances and transactions have been eliminated in consolidation. For consolidated joint ventures, non-controlling interest represents a non-controlling partner’s share of the assets, liabilities and operations related to the six joint venture investments. Potbelly has ownership interests ranging from 51-80% in these consolidated joint ventures. (b) Reporting Period We use a 52/53-week fiscal year that ends on the last Sunday of the calendar year. Approximately every five or six years a 53rd week is added. Fiscal years 2021, 2020 and 2019 each consisted of 52 weeks. (c) Segment Reporting We own and operate Potbelly Sandwich Shop concepts in the United States. We also have domestic franchise operations of Potbelly Sandwich Shops concepts. Our chief operating decision maker (the “CODM”) is our Chief Executive Officer. As the CODM reviews financial performance and allocates resources at a consolidated level on a recurring basis, we have one operating segment and one reportable segment. (d) Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses and the disclosure of contingent assets and liabilities. Significant estimates include amounts for long-lived assets and income taxes. Actual results could differ from those estimates. (e) Fair Value Measurements We apply fair value accounting for all financial assets and liabilities and nonfinancial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis. Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities that are required to be recorded at fair value, we assume the highest and best use of the asset by market participants in which we would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as inherent risk, transfer restrictions, and credit risk. We apply the following fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels, and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: • Level 1 — Quoted prices in active markets for identical assets or liabilities. • Level 2 — Observable inputs other than quoted prices in active markets for identical assets or liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3 — Inputs that are both unobservable and significant to the overall fair value measurement reflect an entity’s estimates of assumptions that market participants would use in pricing the asset or liability. (f) Financial Instruments We record all financial instruments at cost, which is the fair value at the date of transaction. The amounts reported in the consolidated balance sheets for cash and cash equivalents, accounts receivable, accounts payable and all other current liabilities approximate their fair value because of the short-term maturities of these instruments. (g) Cash and Cash Equivalents We consider all highly liquid investment instruments with an original maturity of three months or less when purchased to be cash equivalents. We maintain cash in bank deposit accounts that, at times, may exceed federally insured limits; however, we have not experienced any losses in these accounts. We believe it is not exposed to any significant credit risk. These are valued within the fair value hierarchy as Level 1 measurements. (h) Accounts Receivable, net Accounts receivable, net consists of amounts owed from credit card processors, customers, third-party delivery platforms, vendors and other miscellaneous receivables. (i) Inventories Inventories, which consist of food products, paper goods and supplies, and promotional items, are valued at the lower of cost (first-in, first-out) or net realizable value. No adjustment is deemed necessary to reduce inventory to the lower of cost or net realizable value due to the rapid turnover and high utilization of inventory. (j) Property and Equipment Property and equipment acquired is recorded at cost less accumulated depreciation. Property and equipment is depreciated based on the straight-line method over the estimated useful lives, generally ranging from three Direct costs and expenditures for refurbishments and improvements that significantly add to the productive capacity or extend the useful life of an asset are capitalized, whereas the costs of repairs and maintenance are expensed when incurred. Capitalized costs are recorded as part of the asset to which they relate, primarily to leasehold improvements, and such costs are amortized over the asset’s useful life. When assets are retired or sold, the asset cost and related accumulated depreciation are removed from the consolidated balance sheet and any gain or loss is recorded in impairment, loss on disposal of property and equipment and shop closures in the consolidated statement of operations. (k) Indefinite-Lived Intangible Assets We review indefinite-lived intangible assets, which includes goodwill and tradenames, annually at fiscal year-end for impairment or more frequently if events or circumstances indicate that the carrying values may not be recoverable. An impaired asset is written down to its estimated fair value based on the most recent information available. We assess the fair values of our intangible assets and the fair value of our reporting unit for goodwill using an income-based approach and market-based approach, respectively. Under the income approach, fair value is based on the present value of estimated future cash flows. The income approach is dependent on a number of factors, including forecasted revenues and expenses, appropriate discount rates and other variables. Under the market-based approach, fair value is based on using publicly available market data, including publicly traded stock prices and total shares outstanding. The annual impairment review utilizes the estimated fair value of the intangible assets and the overall reporting unit and compares those estimates to the carrying values as of the testing date. If the carrying value of these intangible assets or the reporting unit exceeds the fair values, we would then use the fair values to measure the amount of any required impairment charge not to exceed the respective carrying amount. No impairment charge was recognized for intangible assets or goodwill for any of the fiscal periods presented. (l) Pre-opening Costs Pre-opening costs consist of costs incurred prior to opening a new shop and are made up primarily of travel, employee payroll and training costs incurred prior to the shop opening, as well as occupancy costs incurred from when we take site possession to shop opening. Shop pre-opening costs are expensed as incurred. (m) Advertising Expenses Advertising costs are expensed as incurred and are included in the consolidated statements of operations. Advertising expenses were $3.0 million, $1.0 million and $4.1 million in fiscal years 2021, 2020 and 2019, respectively. (n) Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are attributed to differences between financial statement and income tax reporting. Deferred tax assets, net of any valuation allowances, represent the future tax return consequences of those differences and for operating loss and tax credit carryforwards, which will be deductible when the assets are recovered. Deferred tax assets are reduced by a valuation allowance if it is deemed more likely than not that some or all of the deferred tax assets will not be realized. In making this assessment of the realizability of deferred tax assets, we consider all positive and negative evidence as to whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. We consider the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Deferred tax liabilities are recognized for temporary differences that will be taxable in future years’ tax returns. We account for uncertain tax positions under current accounting guidance, which prescribes a minimum probability threshold that a tax position must meet before a financial statement benefit is recognized. The minimum threshold is defined as a tax position that is more likely than not to be sustained upon examination by tax authorities, based on the technical merits of the position. The tax benefit to be recognized is measured as the largest amount of benefit that is greater than fifty percent likely of being realized upon ultimate settlement. (o) Stock-Based Compensation We account for stock-based compensation in accordance with Accounting Standards Codification (“ASC”) 718, Stock Based Compensation . We record stock-based compensation expense, net of forfeitures, on a straight-line basis over the vesting period based on the grant-date fair value of the awards, which is determined using the Black-Scholes option pricing valuation model for stock options and the quoted share price of Potbelly’s common stock on the date of grant for restricted stock units (“RSUs”). We award performance share units (“PSUs”) to eligible employees; the PSUs are subject to service and performance vesting conditions. The PSUs will vest based on our achievement of certain targets specified in the awards which may include adjusted EBITDA, same-store sales, or stock price targets. Potbelly defines adjusted EBITDA as net income before depreciation and amortization, interest expense and provision for income taxes, adjusted for the following items that we do not consider representative of ongoing operating performance: stock-based compensation expense, impairment and shop closure expenses, gain or loss on disposal of property and equipment, and pre-opening expenses as well as other one-time, non-recurring charges, such as CEO transition costs. Refer to Note 11 and Note 13 for more details regarding our Equity Plans. (p) Leases We determine if an arrangement is a lease at inception of the arrangement. We lease retail shops, warehouse, and office space under operating leases. Our leases generally have terms of ten years and most include options to extend the leases for additional five-year periods. For leases with renewal periods at our option, we determine the expected lease period based on whether the renewal of any options are reasonably assured at the inception of the lease. Operating leases result in the recording a right-of-use asset and lease liability on the consolidated balance sheet. Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease assets and liabilities are recognized at the lease commencement date, which is the date we take possession of the property. Operating lease liabilities represent the present value of lease payments not yet paid. Operating right-of-use assets represent the operating lease liability adjusted for prepayments or accrued lease payments, initial direct costs, lease incentives, and impairment of operating lease assets. In determining the present value of lease payments not yet paid, we estimate our incremental secured borrowing rates corresponding to the maturities of our leases. We estimate this rate based on prevailing financial market conditions, comparable company and credit analysis, and management judgment. Our leases typically contain rent escalations over the lease term and lease expense is recognized on a straight-line basis over the lease term. Tenant incentives used to fund leasehold improvements are recognized when earned and reduce right-of-use assets related to the lease. The tenant incentives are amortized through the right-of-use asset as reductions of rent expense over the lease term. We elected a short-term lease exception policy, permitting us to not apply the recognition requirements of ASC 842, Leases, to short-term leases (i.e. leases with terms of 12 months or less) and an accounting policy to account for lease and non-lease components as a single component for certain classes of assets. (q) Revenue Recognition We primarily earn revenue at a point in time for sandwich shop sales which can occur in person at the shop, over our online or app platforms, or through a third-party platform. Sales taxes collected from customers are excluded from revenues and the obligation is included in accrued liabilities until the taxes are remitted to the appropriate taxing authorities. We have other revenue generating activities outlined below. Franchise Revenue We earn an initial franchise fee, a franchise development agreement fee and ongoing royalty fees under our franchise agreements. Initial franchise fees are considered highly dependent upon and interrelated with the franchise right granted in the franchise agreement. As such, these franchise fees are recognized over the contractual term of the franchise agreement. We record a contract liability for the unearned portion of the initial franchise fees. Franchise development agreement fees represent the exclusivity rights for a geographical area paid by a third party to develop Potbelly shops for a certain period of time. Franchise development agreement fee payments received by us are recorded in the consolidated balance sheets as accrued expenses or other long-term liabilities, and amortized over the life of the franchise development agreement. Royalty fees are based on a percentage of sales and are recorded as revenue as the fees are earned and become receivable from the franchisee. Gift Card Redemptions / Breakage Revenue Potbelly sells gift cards to customers, records the sale as a contract liability and recognizes the associated revenue as the gift card is redeemed. A portion of these gift cards are not redeemed by the customer ("breakage"), which is recognized as revenue as a percentage of customers gift card redemptions. The expected breakage amount recognized is determined by a historical data analysis on gift card redemption patterns. We recognize gift card breakage income within net sandwich shop sales in the consolidated statements of operations. Loyalty Program We offer a customer loyalty program for customers using the Potbelly Perks application at the point of sale. The customer will typically earn 10 points for every dollar spent, and the customer will earn a free entrée after earning 1,000 points. We defer revenue associated with the estimated selling price of points earned by Potbelly Perks members towards free entrées as each point is earned, and a corresponding liability is established in deferred revenue. The deferral is based on the estimated value of the product for which the reward is expected to be redeemed, net of estimated unredeemed points. Once a customer earns a free entrée, that entrée reward will expire after 30 days. Any point in a customer’s account that does not go toward earning a full entrée will expire after the customer's account has been inactive for a year. The breakage amount recognized is estimated based on a historical data analysis of loyalty reward redemptions and is recognized in net shop sandwich sales in the consolidated statement of operations. When points are redeemed, we recognize revenue for the redeemed product and reduce accrued expenses. (r) Impairment of Long-Lived Assets We assess potential impairments of our long-lived assets, which include property and equipment and right-of-use assets for operating leases, whenever events or circumstances indicate that the carrying amount of an asset may not be recoverable. Assets are grouped at the individual shop-level for the purposes of the impairment assessment because a shop represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. Recoverability of an asset group is measured by a comparison of the carrying amount of an asset group to its estimated forecasted shop cash flows expected to be generated by the asset group. If the carrying amount of the asset group exceeds its estimated forecasted shop cash flows, an impairment charge is recognized as the amount by which the carrying amount of the asset exceeds the fair value of the asset group in the impairment, loss on disposal of property and equipment and shop closures in the consolidated statement of operations. The fair value of the shop assets is determined using the income approach. Key inputs to this approach include forecasted shop cash flows, discount rate, and estimated market rent, which are all classified as Level 3 inputs. See “Fair Value Measurements” above for a definition of Level 3 inputs. Upon transition of adoption to ASC 842, we impaired $0.7 million of pre-tax right-of-use assets related to previously impaired shops. This amount is recorded, net of tax, as an opening reduction to retained earnings. We recorded impairment charges of $2.8 million, $10.3 million, and $2.6 million for the fiscal years 2021, 2020, and 2019, respectively, which is included in impairment, loss on disposal of property and equipment and shop closures in the consolidated statements of operations. Assets recognized or disclosed at fair value on the consolidated financial statements on a nonrecurring basis included items such as leasehold improvements, property and equipment, right-of-use assets for operating leases, goodwill, and other intangible assets. These assets are measured at fair value if determined to be impaired. (s) Recent Accounting Pronouncements On December 31, 2018, we adopted Accounting Standards Update (ASU) 2016-02, “Leases (Topic 842),” along with related clarifications and improvements. This pronouncement requires lessees to recognize a liability for lease obligations, which represents the discounted obligation to make future lease payments, and a corresponding right-of-use asset on the balance sheet. The guidance requires disclosure of key information about leasing arrangements that is intended to give financial statement users the ability to assess the amount, timing, and potential uncertainty of cash flows related to leases. We elected the optional transition method to apply the standard as of the effective date and therefore, prior period amounts have not been adjusted and continue to be reported in accordance with our historical accounting under previous lease guidance. The adoption of Topic 842 had a material impact on the consolidated balance sheets and an immaterial impact on the consolidated statements of operations, consolidated statements of equity and consolidated statements of cash flows. On December 30, 2019, we adopted Accounting Standard Update No. 2016-13, Financial Instruments—Credit Losses (Topic 326) . This pronouncement requires the measurement and recognition of expected credit losses on financial instruments. ASU 2016-13 replaces the existing incurred loss model with a forward-looking expected credit loss model that requires consideration of a broader range of information to estimate credit losses. We recorded a net reduction of $5 thousand to opening accumulated deficit as of December 30, 2019, due to the cumulative impact of adopting Topic 326. On December 28, 2020, we adopted Accounting Standard Update No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging— Contracts in Entity’s Own Equity (Subtopic 815-40) . This pronouncement simplifies the accounting for certain financial instruments with liability and equity characteristics, including convertible instruments and contracts on an entity’s own equity. It removes certain criteria that previously had to be satisfied in order to classify a contract as equity and revises the guidance on calculating earnings per share, requiring use of the if-converted method for all convertible instruments and rescinding a company’s ability to rebut the presumption of share settlement for instruments that may be settled in cash or other. There was no impact to our financial statements or loss per share presentation in the period of adoption due to the impact of adopting this pronouncement. |
Revenue
Revenue | 12 Months Ended |
Dec. 26, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue For the fiscal year ended December 26, 2021, revenue recognized from all revenue sources on point in time sales was $379.3 million, and revenue recognized from sales over time was $0.8 million. For the fiscal year ended December 27, 2020, revenue recognized from all revenue sources on point in time sales was $290.7 million, and revenue recognized from sales over time was $0.6 million. We recognized gift card breakage income of $0.2 million, $0.2 million and $0.2 million for the fiscal years ended 2021, 2020 and 2019, respectively, which is recorded within net sandwich shop sales in the consolidated statements of operations. Contract Liabilities As described in Note 2, we record current and noncurrent contract liabilities in accrued expenses and other long-term liabilities, respectively, for initial franchise fees, gift cards, and loyalty programs. We have no other contract liabilities or contract assets recorded. The opening and closing balances of our current and noncurrent contract liabilities from contracts with customers were as follows: Current Contract Noncurrent Contract Beginning balance as of December 27, 2020 $ 3,138 $ 1,707 Ending balance as of December 26, 2021 6,533 1,428 Increase (decrease) in contract liability $ 3,395 $ (279) The aggregate value of remaining performance obligations on outstanding contracts was $8.0 million as of December 26, 2021. The overall increase in the liability during the 52 weeks ended December 26, 2021 was a result of purchases of new gift cards and an increase in the loyalty programs liability, partially offset by gift card redemptions. We expect to recognize revenue related to contract liabilities as follows (in thousands), which may vary based upon franchise activity, and gift card and loyalty program redemption patterns: Years Ending Amount 2022 $ 5,543 2023 568 2024 273 2025 355 2026 145 Thereafter 1,077 Total revenue recognized $ 7,961 For the 52 weeks ended December 26, 2021, the amount of revenue recognized related to the December 27, 2020 liability ending balance was $1.1 million. For the 52 weeks ended December 27, 2020, the amount of revenue recognized related to the December 29, 2019 liability ending balance was $1.1 million. This revenue related to the recognition of gift card redemptions and upfront franchise fees. For the years ended December 26, 2021 and December 27, 2020, we did not recognize any revenue from obligations satisfied (or partially satisfied) in prior periods. |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 12 Months Ended |
Dec. 26, 2021 | |
Earnings Per Share [Abstract] | |
Earnings (Loss) Per Share | Earnings (Loss) Per Share Basic and diluted loss per common share attributable to common stockholders are calculated using the weighted average number of common shares outstanding for the period. Diluted loss per common share attributable to common stockholders is computed by dividing the loss allocated to common stockholders by the weighted average number of fully diluted common shares outstanding. In periods of a net loss, no potential common shares are included in diluted shares outstanding as the effect is anti-dilutive. For fiscal years 2021, 2020 and 2019, we had a loss per share, therefore, potentially dilutive shares were excluded from the calculation. The following table summarizes the earnings (loss) per share calculation (in thousands): Fiscal Year 2021 2020 2019 Net loss attributable to Potbelly Corporation $ (23,784) $ (65,391) $ (23,992) Weighted average common shares outstanding-basic 27,640 23,899 23,850 Plus: Effect of potentially dilutive shares — — — Weighted average common shares outstanding-diluted 27,640 23,899 23,850 Loss per share available to common stockholders-basic $ (0.86) $ (2.74) $ (1.01) Loss per share available to common stockholders-diluted $ (0.86) $ (2.74) $ (1.01) Potentially dilutive shares that are considered anti-dilutive: Shares 1,951 2,754 2,334 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 26, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and EquipmentProperty and equipment, net consisted of the following (in thousands): December 26, December 27, Leasehold improvements $ 152,510 $ 158,797 Machinery and equipment 46,830 46,653 Furniture and fixtures 33,060 33,194 Computer equipment and software 37,267 36,225 Construction in progress 392 863 270,059 275,732 Less: Accumulated depreciation (220,254) (214,539) $ 49,805 $ 61,193 We recognized $2.4 million, $0.5 million and $0.4 million in 2021, 2020, and 2019, respectively, of losses on disposal of property and equipment in impairment, loss on disposal of property and equipment and shop closures in the consolidated statement of operations, primarily related to closures of company-owned shops. |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Dec. 26, 2021 | |
Accrued Liabilities, Current [Abstract] | |
Accrued Expenses | Accrued Expenses Accrued expenses consisted of the following (in thousands): December 26, December 27, Accrued labor and related expenses $ 13,408 $ 7,313 Gift card liability 3,956 1,868 Deferred revenue 2,785 1,491 Accrued occupancy and utilities 2,347 3,696 Accrued sales and use tax 2,220 1,477 Accrued liability insurance 1,817 1,422 Accrued restructuring 122 1,489 Other accrued expenses 4,204 3,681 Total $ 30,859 $ 22,437 We incur expenses associated with exit activity for certain signed lease agreements, which are recognized in impairment, loss on disposal of property and equipment and shop closures in the consolidated statement of operations. Accrued contract termination costs consisted of the following (in thousands): December 26, December 27, Accrued contract termination costs—beginning balance $ — $ — Contract termination costs incurred 430 3,231 Contract termination costs settled and paid (430) (3,231) Accrued contract termination costs—ending balance $ — $ — |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 26, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Income (loss) before income taxes for our domestic and foreign operations was as follows (in thousands): Fiscal Year 2021 2020 2019 Domestic operations $ (23,451) $ (72,208) $ (9,790) Foreign operations — — 395 Total $ (23,451) $ (72,208) $ (9,395) Income tax expense (benefit) consisted of the following (in thousands): Fiscal Year 2021 2020 2019 Federal: Current $ — $ (6,739) $ 159 Deferred (150) 13 9,379 (150) (6,726) 9,538 State and Local: Current 161 185 227 Deferred 161 5 4,425 322 190 4,652 Foreign: Current — — — — — — Income tax expense (benefit) $ 172 $ (6,536) $ 14,190 Income tax expense (benefit) differed from the amounts computed by applying the U.S. federal income tax rates to income (loss) before income taxes as a result of the following (in thousands): Fiscal Year 2021 2020 2019 U.S. federal statutory tax 21.0% 21.0% 21.0% Computed “expected” tax benefit $ (4,959) $ (15,164) $ (1,973) Increase (reduction) resulting from: Valuation allowance 5,456 14,265 16,116 Rate change impact of net operating loss carryback — (2,592) — Minority interest 34 74 (107) Permanent differences 1,004 99 425 State and local income taxes, net of federal income tax effect (730) (3,338) (361) FICA and other tax credits (592) (248) (504) Equity compensation (237) 477 577 Other — (109) (106) Tax rate change 196 — 123 Income tax expense (benefit) $ 172 $ (6,536) $ 14,190 The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities reflected in the consolidated balance sheets are presented below (in thousands): December 26, December 27, Deferred tax assets: Net operating loss carryforwards $ 19,454 $ 14,364 Accrued liabilities 2,188 2,152 Deferred revenue 875 573 Stock-based compensation 1,304 1,993 Property and equipment 4,398 3,505 Operating lease liabilities 51,105 59,230 Tax credits and other carryforwards 2,840 2,319 Gross deferred tax assets 82,164 84,136 Valuation allowance (34,929) (30,381) Net deferred tax assets 47,235 53,755 Deferred tax liabilities: Prepaids (264) (285) Right-of-use asset for operating leases (44,973) (51,637) Intangible assets (1,319) (1,249) Smallwares (474) (482) Other (463) (348) Total deferred tax liabilities (47,493) (54,001) Net deferred tax liabilities $ (258) $ (246) We recorded deferred tax assets related to federal and state income tax net operating loss (“NOL”) carryforwards of approximately $19.5 million and $14.3 million for the years ended December 26, 2021 and December 27, 2020, respectively. The federal NOL, and a portion of the state NOLs, can be carried forward indefinitely, although certain jurisdictions, including federal and numerous states, limit NOL carryforwards to a percentage of current year taxable income. We regularly assesses the need for a valuation allowance related to its deferred tax assets, which includes consideration of both positive and negative evidence related to the likelihood of realization of such deferred tax assets to determine, based on the weight of the available evidence, whether it is more-likely-than-not that some or all of its deferred tax assets will not be realized. In its assessment, we considered recent financial operating results, projected future taxable income, the reversal of existing taxable differences, and tax planning strategies. We recorded a full valuation allowance against its net deferred tax assets during the first quarter of 2019, resulting in a non-cash charge to income tax expense of $13.6 million. We continued to maintain a valuation allowance against all of its deferred tax assets as of December 26, 2021. We did not provide for an income tax benefit on its pre-tax loss for the years ended December 26, 2021 and December 27, 2020. We assess the likelihood of the realization of its deferred tax assets each quarter and the valuation allowance is adjusted accordingly. As of December 26, 2021 and December 27, 2020, we have a valuation allowance related to our deferred tax assets of $34.9 million and $30.4 million, respectively. On March 27, 2020, the CARES Act was enacted into law. The CARES Act is a tax and spending package intended to provide economic relief to address the impact of the COVID-19 pandemic. The CARES Act includes several significant business tax provisions that, among other things, would eliminate the taxable income limit for certain NOLs and allow businesses to carry back NOLs arising in 2018, 2019, and 2020 to the five prior tax years, accelerate refunds of previously generated corporate AMT credits, loosen the business interest limitation under section 163(j), and fix the qualified improvement property regulations in the 2017 Tax Cuts and Jobs Act. As a result of the CARES Act, we were able to obtain a tax refund of $6.7 million from the carryback of NOLs and a refund of prior AMT credits. We received the entire amount of the refund during the fiscal year 2020. We recognized an income tax benefit of $6.7 million during fiscal year 2020 due to the impact of the CARES Act and the finalization of our 2020 federal tax return. In accordance with our accounting policy, we recognize accrued interest and penalties related to unrecognized tax benefits as a component of income tax expense. As of December 26, 2021 and December 27, 2020, we had no interest or penalties accrued. As of December 26, 2021 and December 27, 2020, we had no uncertain tax positions. |
Leases
Leases | 12 Months Ended |
Dec. 26, 2021 | |
Leases [Abstract] | |
Leases | Leases In fiscal year 2020, as a result of COVID-19, we held discussions with landlords regarding restructuring of our leases in light of various contractual and legal defenses, and we subsequently entered into lease amendments with our respective landlords at 335 of our shops through December 26, 2021. The vast majority of these lease amendments were completed during fiscal year 2020, and we are fully complete with COVID-19-related lease amendments as of December 26, 2021. The gains recognized upon lease terminations are recorded in impairment, loss on disposal of property and equipment and shop closures in the consolidated statement of operations. The right-of use assets, liabilities and gains recognized upon termination of lease contracts were as follows: Fiscal Year 2021 Fiscal Year 2020 Leases terminated 3 28 Lease termination fees $ 177 $ 2,832 Right-of-use assets derecognized upon lease termination 1,433 14,774 Lease liabilities derecognized upon lease termination 1,555 16,103 Gain recognized upon lease termination $ 122 $ 1,329 Operating lease term and discount rate were as follows: December 26, December 27, Weighted average remaining lease term (years) 7.22 7.82 Weighted average discount rate 8.00% 7.88% Certain of the our operating lease agreements include variable payments that are passed through by the landlord, such as common area maintenance and real estate taxes, as well as variable payments based on percentage rent for certain of our shops. Pass-through charges and payments based on percentage rent are included within variable lease cost. The components of lease cost were as follows (in thousands): Classification Fiscal Year 2021 Fiscal Year 2020 Operating lease cost Occupancy and general and administrative expenses $ 41,091 $ 45,350 Variable lease cost Occupancy and general and administrative expenses 12,715 11,885 Total lease cost $ 53,806 $ 57,235 Supplemental disclosures of cash flow information relating to leases is as follows (in thousands): Fiscal Year 2021 Fiscal Year 2020 Operating cash flows rent paid for operating lease liabilities $ 48,099 $ 35,168 Operating right-of-use assets obtained in exchange for new operating lease liabilities 10,371 20,369 Reduction in operating right-of-use assets due to lease terminations and modifications $ 6,075 $ 14,774 Maturities of lease liabilities were as follows at December 26, 2021 (in thousands): Operating Leases 2022 $ 42,740 2023 38,104 2024 35,457 2025 32,583 2026 28,767 Thereafter 83,277 Total lease payments 260,928 Less: imputed interest (66,089) Present value of lease liabilities $ 194,839 |
Debt and Credit Facilities
Debt and Credit Facilities | 12 Months Ended |
Dec. 26, 2021 | |
Debt Disclosure [Abstract] | |
Debt and Credit Facilities | Debt and Credit Facilities The components of long-term debt were as follows: December 26, December 27, Revolving Credit Facility $ 9,850 $ 6,286 Paycheck Protection Program loan 10,000 10,000 Less: current portion of long-term debt (2,333) (333) Total long-term debt $ 17,517 $ 15,953 Revolving Credit Facility On August 7, 2019, we entered into a second amended and restated revolving credit facility agreement (the "Credit Agreement") with JPMorgan Chase Bank, N.A. (“JPMorgan”). The Credit Agreement amends and restates that certain amended and restated revolving credit facility agreement, dated as of December 9, 2015, and amended on May 3, 2019 (collectively, the "Prior Credit Agreement") with JPMorgan. The Credit Agreement provided, among other things, for a revolving credit facility in a maximum principal amount $40 million, with possible future increases of up to $20 million under an expansion feature. Borrowings under the credit facility generally bear interest at our option at either (i) a eurocurrency rate determined by reference to the applicable LIBOR rate plus a specified margin or (ii) a prime rate as announced by JP Morgan plus a specified margin. The applicable margin was determined based upon our consolidated total leverage ratio. On the last day of each calendar quarter, we were required to pay a commitment fee of 0.20% per annum in respect of any unused commitments under the credit facility. So long as certain total leverage ratios, EBITDA thresholds and minimum liquidity requirements are met and no default or event of default has occurred or would result, there was no limit on the “restricted payments” (primarily distributions and equity repurchases) that we may make, provided that proceeds of the loans under the Credit Agreement may not be used for purposes of making restricted payments. As disclosed in our Annual Report on Form 10-K for the fiscal year ended December 27, 2020, during 2020, we drew on the credit facility to increase our cash position and preserve financial flexibility in light of the uncertainty resulting from the COVID-19 pandemic, and we amended the Credit Agreement throughout fiscal year 2020 . We entered into Amendment No. 5 (the “Fifth Amendment”) to the Credit Agreement on February 26, 2021. As a result of the Amendment (i) the maturity date was extended from March 31, 2022 to January 31, 2023, (ii) the revolving credit commitment decreased from $40 million to $25 million, (iii) the interest rate margin with respect to any Commercial Bank Floating Rate Loan increased to 2.75%, (iv) the interest rate margin with respect to any Eurodollar Loan increased to 5.00%, (v) the definition of EBITDA was amended to exclude non-cash charges/gains in connection with certain equity interests of the Company, (vi) certain borrowing conditions relating to our Consolidated Cash Balance were instituted, (vii) we are permitted to repurchase/redeem its equity interests under certain conditions and (viii) the minimum monthly EBITDA and Liquidity thresholds we must maintain were revised. As of December 26, 2021, we had $9.9 million outstanding under the Credit Agreement. As of December 27, 2020, we had $6.3 million outstanding under the Credit Agreement. We are currently in compliance with all financial debt covenants. On January 28, 2022, we entered into Amendment No. 6 (the “Sixth Amendment”) to the Credit Agreement. The Sixth Amendment, among other things, (i) extends the maturity date under the Credit Agreement from January 31, 2023 to May 31, 2023, (ii) changes the benchmark interest rates under the Credit Agreement for borrowings from the London Interbank Offered Rate (LIBOR) to the Secured Overnight Financing Rate (SOFR) subject to certain adjustments in the Sixth Amendment, (iii) increases the interest rate margin by 75 basis points with respect to any CBFR Loan (as defined in the Credit Agreement), (iv) sets the interest rate margin at 600 basis points with respect to any Term Benchmark Loan (as defined in the Credit Agreement), (v) amends certain financial covenant testing levels, and (vi) amends the definition of subsidiary to exclude the Potbelly Employee Relief Fund NFP, an Illinois not-for-profit corporation. Paycheck Protection Program Loan On August 10, 2020, PSW, an indirect subsidiary of ours, entered into a loan agreement with Harvest Small Business Finance, LLC in the aggregate amount of $10.0 million (the “Loan”), pursuant to the PPP under the CARES Act. The Loan was necessary to support our ongoing operations due to the economic uncertainty resulting from the COVID-19 pandemic and lack of access to alternative sources of liquidity. The Loan is scheduled to mature five years from the date on which PSW applies for loan forgiveness under the CARES Act, bears interest at a rate of 1% per annum and is subject to the terms and conditions applicable to loans administered by the U.S. Small Business Administration under the CARES Act. The PPP provides that the use of the Loan amount shall be limited to certain qualifying expenses and may be partially or wholly forgiven in accordance with the requirements set forth in the CARES Act. We have used all of the PPP proceeds toward qualifying expenses and are pursuing forgiveness of the full Loan amount, but we are not able to determine the likelihood or the amount of forgiveness that will be obtained. If the Loan is ultimately not forgiven, we will be required to repay the Loan over 5 years at a 1% interest rate. We have recorded the amount of the Loan as long-term debt (current and non-current) in our consolidated balance sheet as of December 26, 2021 and related interest has been recorded to interest expense on our consolidated statement of operations for the year ended December 26, 2021. |
Restructuring
Restructuring | 12 Months Ended |
Dec. 26, 2021 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | Restructuring On November 3, 2020, as part of our COVID-related cost reduction efforts and to better align our general and administrative expenses with future strategy, we made the determination to reorganize and restructure our corporate team. The restructuring plan implemented resulted in general and administrative expense savings in 2021. This was accomplished through corporate expense optimization, consolidating our shop support services, and through other expense and staff reductions. As a result, we reduced corporate employment levels by approximately 35 employees in the fourth quarter of 2020. The restructuring charges recognized in the fourth quarter of 2020 consist primarily of one-time termination benefits to employees. We substantially completed our planned restructuring actions during 2020, but we will continue to evaluate our cost structure and seek opportunities for further efficiencies and cost savings as part of our ongoing strategy. As such, we may incur additional restructuring related charges or adjustments to previously recorded charges in the future, however, we are unable to estimate the amount of charges at this time. The accrued restructuring balances as of December 26, 2021 represent expected future cash payments required to satisfy our remaining obligations, which are expected to be paid throughout 2022. Total (Thousands) Balance as of December 27, 2020 $ 1,489 Charges incurred — Payments made (1,367) Balance as of December 26, 2021 $ 122 |
Capital Stock
Capital Stock | 12 Months Ended |
Dec. 26, 2021 | |
Equity [Abstract] | |
Capital Stock | Capital Stock As of December 26, 2021 and December 27, 2020, we had authorized an aggregate of 210,000 thousand shares of capital stock, of which 200,000 thousand shares were designated as common stock and 10,000 thousand shares were designated as preferred stock. As of December 26, 2021, we had issued and outstanding 38,164 thousand and 28,380 thousand shares of common stock, respectively. As of December 27, 2020, we had issued and outstanding 33,935 thousand and 24,323 thousand shares of common stock, respectively. Common Stock On May 8, 2018, we announced that its Board of Directors authorized a stock repurchase program for up to $65.0 million of its outstanding common stock. The program permits us, from time to time, to purchase shares in the open market (including in pre-arranged stock trading plans in accordance with the guidelines specified in Rule 10b5-1 under the Securities and Exchange Act of 1934, as amended) or in privately negotiated transactions. The number of common shares actually repurchased, and the timing and price of repurchases, will depend upon market conditions, SEC requirements and other factors. Purchases may be started or stopped at any time without prior notice depending on market conditions and other factors. We did not repurchase any shares of our common stock during 2021. In light of the COVID-19 pandemic, we do not have plans to repurchase any common stock under its stock repurchase program at this time. As of December 26, 2021, the remaining dollar value of authorization under the share repurchase program was $37.9 million, which includes commission. Repurchased shares are included as treasury stock in the consolidated balance sheets and the consolidated statements of equity. On February 9, 2021, we closed on a Securities Purchase Agreement (the “SPA”) for the sale by us of 3,249,668 shares of our common stock at a par value of $0.01 per share and the issuance of warrants to purchase 1,299,861 shares of common stock at an exercise price of $5.45 per warrant for gross proceeds of $16.0 million, before deducting placement agent fees and offering expenses of approximately $1.0 million. The warrants are initially exercisable commencing August 13, 2021 through their expiration date of August 12, 2026. The proceeds received from the SPA were allocated between shares and warrants based on their relative fair values at closing. The warrants were valued utilizing the Black-Scholes method. |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 26, 2021 | |
Postemployment Benefits [Abstract] | |
Employee Benefit Plan | Employee Benefit PlanWe sponsor a 401(k) profit sharing plan for all employees who are eligible based upon age and length of service. We made matching contributions of $0.3 million, $0.2 million, and $0.5 million for fiscal years 2021, 2020 and 2019, respectively, which are recorded in labor and related expenses and general and administrative expenses in the consolidated statement of operations. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 26, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Stock-Based Compensation Granted Under the 2019 Long-Term Incentive Plan Stock options and restricted stock units are awarded under the 2019 Long-Term Incentive Plan (the “2019 Plan”) to eligible employees and certain non-employee members of the Board of Directors. The 2019 Plan gives broad powers to our Board of Directors to administer and interpret the 2019 Plan, including the authority to select the individuals to be granted equity awards and rights and to prescribe the particular form and conditions of each equity award to be granted. On May 16, 2019, our stockholders approved the 2019 Plan and, in connection therewith, all equity awards made after that date were made under the 2019 Plan. On June 10, 2019, we registered 1,200 thousand shares of our common stock reserved for issuance under the 2019 Plan. The Amended and Restated 2013 Long-Term Incentive Plan (the “2013 Plan”) had 626 thousand remaining shares of common stock reserved for issuance, which are available for issuance under the 2019 Plan and no future awards will be made under the 2013 Plan. On June 24, 2020 the 2019 Plan was amended and restated effective to increase the number of shares of common stock authorized for issuance by 900 thousand shares, for a total of 2,100 thousand shares. As of December 26, 2021, there have been 3,687 thousand shares of restricted stock units and performance stock units granted under the 2019 Plan. As of December 26, 2021, there are 1,568 thousand shares reserved for future issuance. Stock Options Under the Plans, the number of shares and exercise price of each option are determined by the committee designated by our Board of Directors. The options granted are generally exercisable within a 10-year period from the date of grant. We award options to certain employees including the senior leadership team. Options outstanding expire on various dates through the year 2028. The range of exercise prices for options outstanding as of December 26, 2021 is $8.16 to $20.53 per option, and the options generally vest in one-fourth and one-fifth increments over four five A summary of stock option activity is as follows: Options Shares (Thousands) Weighted Aggregate Weighted Outstanding—December 30, 2018 2,150 $ 11.49 $ 378 5.13 Granted — — Exercised (22) 7.93 Canceled (354) 12.45 Outstanding—December 29, 2019 1,774 $ 11.34 $ — 4.33 Granted — — Exercised — — Canceled (541) 12.84 Outstanding—December 27, 2020 1,233 $ 10.68 $ — 2.49 Granted — — Exercised (31) 7.24 Canceled (664) 9.75 Outstanding—December 26, 2021 538 $ 12.03 $ — 2.35 Exercisable—December 26, 2021 534 $ 12.02 $ — 2.32 There were no stock option grants in 2021, 2020, or 2019. Stock-based compensation related to stock options is measured at the grant date based on the calculated fair value of the award, and is recognized as expense over the requisite employee service period, which is generally the vesting period of the grant with a corresponding increase to additional paid-in capital. For the years ended December 27, 2020 and December 29, 2019, we recognized stock-based compensation expense related to stock options of $0.1 million and $0.8 million, respectively. For the year ended December 26, 2021, we recognized stock-based compensation expense related to stock options of less than $0.1 million. As of December 26, 2021, unrecognized stock-based compensation expense related to stock options was less than $0.1 million, which will be recognized through fiscal year 2022.We record stock-based compensation expense within general and administrative expenses in the consolidated statements of operations. Restricted stock units We award restricted stock units (“RSUs”) to certain employees and certain non-employee members of our Board of Directors. Prior to 2021, the Board of Director grants have a vesting schedule of 50% on the first anniversary of the grant date and 50% on the second anniversary of the grant date. Beginning with the annual grant made in the second quarter of 2021, the Board of Director grants fully vest on the first anniversary of the grant date, or upon termination from the Board of Directors for any reason other than for cause, a pro rata portion of the shares vest on the termination date. The employee grants vest in one-third increments over a three-year period. A summary of RSU activity is as follows: RSUs Number of RSUs (Thousands) Weighted Average Non-vested as of December 30, 2018 247 $ 11.99 Granted 402 6.47 Vested (135) 11.94 Canceled (51) 8.48 Non-vested as of December 29, 2019 463 $ 7.59 Granted 1,604 2.79 Vested (231) 2.87 Canceled (842) 3.65 Non-vested as of December 27, 2020 994 $ 3.35 Granted 649 6.16 Vested (479) 7.05 Canceled (13) 3.50 Non-vested as of December 26, 2021 1,151 $ 4.87 For the years ended December 26, 2021, December 27, 2020 and December 29, 2019, we recognized stock-based compensation expense related to RSUs of $1.6 million , $1.5 million and $1.5 million, respectively. As of December 26, 2021, unrecognized stock-based compensation expense for RSUs was $4.2 million , which will be recognized though fiscal year 2024. Performance stock units We award performance share units (“PSUs”) to certain employees. The PSUs have certain vesting conditions based upon our stock price and relative stock performance. Because these PSUs are subject to service and market vesting conditions, we determine the fair market value of each grant using a Monte Carlo simulation model. Participants are entitled to receive a specified number of shares of our common stock contingent on achievement of a stock return on our common stock. For the years ended December 26, 2021 and December 27, 2020, we recognized stock-based compensation expense related to PSUs with market vesting conditions of $0.5 million and $0.9 million, respectively. For the year ended December 29, 2019, we did not recognize stock-based compensation expense related to PSUs with market vesting conditions. A summary of activity for PSUs with market vesting conditions is as follows: PSUs Number of PSUs Weighted Average Non-vested as of December 27, 2020 502 $ 1.38 Granted 130 8.43 Vested (502) 6.76 Canceled — 0.00 Non-vested as of December 26, 2021 130 $ 8.43 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 26, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies We are subject to legal proceedings, claims and liabilities, such as employment-related claims and slip and fall cases, which arise in the ordinary course of business and are generally covered by insurance. We accrue for such liabilities when it is probable that future costs will be incurred and such costs can be reasonably estimated. Such accruals are based on developments to date, our estimates of the outcomes of these matters and its experience in contesting, litigating and settling other similar matters. In the opinion of management, the amount of ultimate liability with respect to those actions should not have a material adverse impact on our financial position or results of operations and cash flows. Many of the food products we purchase are subject to changes in the price and availability of food commodities, including, among other things, beef, poultry, grains, dairy and produce. We work with our suppliers and uses a mix of forward pricing protocols for certain items including agreements with its supplier on fixed prices for deliveries at a time in the future and agreements on a fixed price with our supplier for the duration of those protocols. We also utilize formula pricing protocols under which the prices we pay are based on a specified formula related to the prices of the goods, such as spot prices. Our use of any forward pricing arrangements varies substantially from time to time and these arrangements tend to cover relatively short periods (i.e., typically twelve months or less). Such contracts are used in the normal purchases of our food products and not for speculative purposes, and as such are not required to be evaluated as derivative instruments. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 26, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party TransactionsIn connection with our sale of common stock and warrants to purchase common stock in February 2021 in a private placement, certain of our stockholders that owned greater than 5% of our outstanding shares prior to the closing of the private placement purchased shares of common stock and warrants to purchase common stock on the same terms as the other shares and warrants that were offered and sold in the offering. The purchasers included the following stockholders, none of which owned more than 8.5% of our outstanding common stock prior to the closing of the private placement: 201,514 shares of common stock and warrants to purchase 80,605 shares of common stock were purchased by 180 Degree Capital Corp., for an aggregate purchase price of approximately $1.0 million and 164,875 shares of common stock and warrants to purchase 65,950 shares of common stock were purchased by B&W Pension Trust (of which 180 Degree Capital Corp. is the investment advisor and may be deemed to be a beneficial owner of such shares), for an aggregate purchase price of approximately $0.8 million; 223,904 shares of common stock and warrants to purchase 89,561 shares of common stock were purchased by Agman Investments LLC, for an aggregate purchase price of approximately $1.1 million; 366,389 shares of common stock and warrants to purchase 146,555 shares of common stock were purchased by funds controlled by Ancora Holdings Inc., for an aggregate purchase price of approximately $1.8 million; 193,372 shares of common stock and warrants to purchase 77,348 shares of common stock were purchased by Chain of Lakes Investment Fund, LLC, for an aggregate purchase price of approximately $0.9 million; and 407,099 shares of common stock were purchased by Intrinsic Investment Holdings, LLC, for an aggregate purchase price of approximately $2.0 million. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 26, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Credit Facility On January 28, 2022, we entered into Amendment No. 6 (the “Sixth Amendment”) to the Credit Agreement. The Sixth Amendment, among other things, (i) extends the maturity date under the Credit Agreement from January 31, 2023 to May 31, 2023, (ii) changes the benchmark interest rates under the Credit Agreement for borrowings from the London |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 26, 2021 | |
Accounting Policies [Abstract] | |
Business | Business Potbelly Corporation, a Delaware corporation, together with its subsidiaries (collectively referred to as “the Company,” “Potbelly,” “we,” “us”, or “our”), owns and operates 397 company-owned shops in the United States as of December 26, 2021. Additionally, Potbelly franchisees operate over 46 shops domestically. |
Basis of Presentation | Basis of PresentationBeginning with the first quarter of 2021, advertising expenses are presented separately on the consolidated statements of operation. Prior to the first quarter of 2021, advertising expenses were presented within general and administrative expenses. Prior period amounts have been reclassified to conform to the current presentation. This reclassification had no impact on our results of operations, financial position or cash flows. We do not have any components of other comprehensive income recorded within our consolidated financial statements and therefore, do not separately present a statement of comprehensive income in our consolidated financial statements. |
COVID-19 | COVID-19 On January 30, 2020, the World Health Organization (“WHO”) announced a global health emergency because of a new strain of coronavirus ("COVID-19") and the risks to the international community as the virus spreads globally. On March 11, 2020, the WHO classified the COVID-19 outbreak as a pandemic, based on the rapid increase in exposure globally. In response to the pandemic, many states and jurisdictions in which we operate issued stay-at-home orders and other measures aimed at slowing the spread of the coronavirus, resulting in significant changes to our operations and a sudden and drastic decrease in revenues. While the pandemic continues to have an impact on our business, the distribution of COVID-19 vaccines and lifting of local restrictions resulted in a gradual improvement to our sales during 2021. Nearly all of our shops have reopened their dining rooms and are no longer subject to the operating restrictions and capacity limits related to COVID-19. We will continue to follow guidance from local authorities in determining the appropriate restrictions to put in place for each shop, including mask mandates, hours of operation, and the suspension or reduction of in-shop dining if required due to changes in the pandemic response in each jurisdiction and restaurant operating protocols, which could result in lower in-shop dining revenue or higher operating costs. |
Principles of Consolidation | (a) Principles of Consolidation The consolidated financial statements include the accounts of Potbelly Corporation; its wholly owned subsidiary, Potbelly Illinois, Inc. (“PII”); PII’s wholly owned subsidiaries, Potbelly Franchising, LLC and Potbelly Sandwich Works LLC (“LLC”); seven of LLC’s wholly owned subsidiaries and LLC’s six joint ventures, collectively, the “Company.” All intercompany balances and transactions have been eliminated in consolidation. For consolidated joint ventures, non-controlling interest represents a non-controlling partner’s share of the assets, liabilities and operations related to the six joint venture investments. Potbelly has ownership interests ranging from 51-80% in these consolidated joint ventures. |
Reporting Period | (b) Reporting PeriodWe use a 52/53-week fiscal year that ends on the last Sunday of the calendar year. Approximately every five or six years a 53rd week is added. Fiscal years 2021, 2020 and 2019 each consisted of 52 weeks. |
Segment Reporting | (c) Segment Reporting We own and operate Potbelly Sandwich Shop concepts in the United States. We also have domestic franchise operations of Potbelly Sandwich Shops concepts. Our chief operating decision maker (the “CODM”) is our Chief Executive Officer. As the CODM reviews financial performance and allocates resources at a consolidated level on a recurring basis, we have one operating segment and one reportable segment. |
Use of Estimates | (d) Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses and the disclosure of contingent assets and liabilities. Significant estimates include amounts for long-lived assets and income taxes. Actual results could differ from those estimates. |
Fair Value Measurements | (e) Fair Value Measurements We apply fair value accounting for all financial assets and liabilities and nonfinancial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis. Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities that are required to be recorded at fair value, we assume the highest and best use of the asset by market participants in which we would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as inherent risk, transfer restrictions, and credit risk. We apply the following fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels, and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: • Level 1 — Quoted prices in active markets for identical assets or liabilities. • Level 2 — Observable inputs other than quoted prices in active markets for identical assets or liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3 — Inputs that are both unobservable and significant to the overall fair value measurement reflect an entity’s estimates of assumptions that market participants would use in pricing the asset or liability. |
Financial Instruments | (f) Financial Instruments We record all financial instruments at cost, which is the fair value at the date of transaction. The amounts reported in the consolidated balance sheets for cash and cash equivalents, accounts receivable, accounts payable and all other current liabilities approximate their fair value because of the short-term maturities of these instruments. |
Cash and Cash Equivalents | (g) Cash and Cash Equivalents We consider all highly liquid investment instruments with an original maturity of three months or less when purchased to be cash equivalents. We maintain cash in bank deposit accounts that, at times, may exceed federally insured limits; however, we have not experienced any losses in these accounts. We believe it is not exposed to any significant credit risk. These are valued within the fair value hierarchy as Level 1 measurements. |
Accounts Receivable, net | (h) Accounts Receivable, net Accounts receivable, net consists of amounts owed from credit card processors, customers, third-party delivery platforms, vendors and other miscellaneous receivables. |
Inventories | (i) Inventories Inventories, which consist of food products, paper goods and supplies, and promotional items, are valued at the lower of cost (first-in, first-out) or net realizable value. No adjustment is deemed necessary to reduce inventory to the lower of cost or net realizable value due to the rapid turnover and high utilization of inventory. |
Property and Equipment | (j) Property and Equipment Property and equipment acquired is recorded at cost less accumulated depreciation. Property and equipment is depreciated based on the straight-line method over the estimated useful lives, generally ranging from three Direct costs and expenditures for refurbishments and improvements that significantly add to the productive capacity or extend the useful life of an asset are capitalized, whereas the costs of repairs and maintenance are expensed when incurred. Capitalized costs are recorded as part of the asset to which they relate, primarily to leasehold improvements, and such costs are amortized over the asset’s useful life. When assets are retired or sold, the asset cost and related accumulated depreciation are removed from the consolidated balance sheet and any gain or loss is recorded in impairment, loss on disposal of property and equipment and shop closures in the consolidated statement of operations. |
Indefinite-Lived Intangible Assets | (k) Indefinite-Lived Intangible AssetsWe review indefinite-lived intangible assets, which includes goodwill and tradenames, annually at fiscal year-end for impairment or more frequently if events or circumstances indicate that the carrying values may not be recoverable. An impaired asset is written down to its estimated fair value based on the most recent information available. We assess the fair values of our intangible assets and the fair value of our reporting unit for goodwill using an income-based approach and market-based approach, respectively. Under the income approach, fair value is based on the present value of estimated future cash flows. The income approach is dependent on a number of factors, including forecasted revenues and expenses, appropriate discount rates and other variables. Under the market-based approach, fair value is based on using publicly available market data, including publicly traded stock prices and total shares outstanding. The annual impairment review utilizes the estimated fair value of the intangible assets and the overall reporting unit and compares those estimates to the carrying values as of the testing date. If the carrying value of these intangible assets or the reporting unit exceeds the fair values, we would then use the fair values to measure the amount of any required impairment charge not to exceed the respective carrying amount. No impairment charge was recognized for intangible assets or goodwill for any of the fiscal periods presented. |
Pre-opening Costs | (l) Pre-opening Costs Pre-opening costs consist of costs incurred prior to opening a new shop and are made up primarily of travel, employee payroll and training costs incurred prior to the shop opening, as well as occupancy costs incurred from when we take site possession to shop opening. Shop pre-opening costs are expensed as incurred. |
Advertising Expenses | (m) Advertising Expenses Advertising costs are expensed as incurred and are included in the consolidated statements of operations. Advertising expenses were $3.0 million, $1.0 million and $4.1 million in fiscal years 2021, 2020 and 2019, respectively. |
Income Taxes | (n) Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are attributed to differences between financial statement and income tax reporting. Deferred tax assets, net of any valuation allowances, represent the future tax return consequences of those differences and for operating loss and tax credit carryforwards, which will be deductible when the assets are recovered. Deferred tax assets are reduced by a valuation allowance if it is deemed more likely than not that some or all of the deferred tax assets will not be realized. In making this assessment of the realizability of deferred tax assets, we consider all positive and negative evidence as to whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. We consider the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Deferred tax liabilities are recognized for temporary differences that will be taxable in future years’ tax returns. We account for uncertain tax positions under current accounting guidance, which prescribes a minimum probability threshold that a tax position must meet before a financial statement benefit is recognized. The minimum threshold is defined as a tax position that is more likely than not to be sustained upon examination by tax authorities, based on the technical merits of the position. The tax benefit to be recognized is measured as the largest amount of benefit that is greater than fifty percent likely of being realized upon ultimate settlement. |
Stock-Based Compensation | (o) Stock-Based Compensation We account for stock-based compensation in accordance with Accounting Standards Codification (“ASC”) 718, Stock Based Compensation . We record stock-based compensation expense, net of forfeitures, on a straight-line basis over the vesting period based on the grant-date fair value of the awards, which is determined using the Black-Scholes option pricing valuation model for stock options and the quoted share price of Potbelly’s common stock on the date of grant for restricted stock units (“RSUs”). |
Leases | (p) Leases We determine if an arrangement is a lease at inception of the arrangement. We lease retail shops, warehouse, and office space under operating leases. Our leases generally have terms of ten years and most include options to extend the leases for additional five-year periods. For leases with renewal periods at our option, we determine the expected lease period based on whether the renewal of any options are reasonably assured at the inception of the lease. Operating leases result in the recording a right-of-use asset and lease liability on the consolidated balance sheet. Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease assets and liabilities are recognized at the lease commencement date, which is the date we take possession of the property. Operating lease liabilities represent the present value of lease payments not yet paid. Operating right-of-use assets represent the operating lease liability adjusted for prepayments or accrued lease payments, initial direct costs, lease incentives, and impairment of operating lease assets. In determining the present value of lease payments not yet paid, we estimate our incremental secured borrowing rates corresponding to the maturities of our leases. We estimate this rate based on prevailing financial market conditions, comparable company and credit analysis, and management judgment. Our leases typically contain rent escalations over the lease term and lease expense is recognized on a straight-line basis over the lease term. Tenant incentives used to fund leasehold improvements are recognized when earned and reduce right-of-use assets related to the lease. The tenant incentives are amortized through the right-of-use asset as reductions of rent expense over the lease term. We elected a short-term lease exception policy, permitting us to not apply the recognition requirements of ASC 842, Leases, |
Revenue Recognition | (q) Revenue Recognition We primarily earn revenue at a point in time for sandwich shop sales which can occur in person at the shop, over our online or app platforms, or through a third-party platform. Sales taxes collected from customers are excluded from revenues and the obligation is included in accrued liabilities until the taxes are remitted to the appropriate taxing authorities. We have other revenue generating activities outlined below. Franchise Revenue We earn an initial franchise fee, a franchise development agreement fee and ongoing royalty fees under our franchise agreements. Initial franchise fees are considered highly dependent upon and interrelated with the franchise right granted in the franchise agreement. As such, these franchise fees are recognized over the contractual term of the franchise agreement. We record a contract liability for the unearned portion of the initial franchise fees. Franchise development agreement fees represent the exclusivity rights for a geographical area paid by a third party to develop Potbelly shops for a certain period of time. Franchise development agreement fee payments received by us are recorded in the consolidated balance sheets as accrued expenses or other long-term liabilities, and amortized over the life of the franchise development agreement. Royalty fees are based on a percentage of sales and are recorded as revenue as the fees are earned and become receivable from the franchisee. Gift Card Redemptions / Breakage Revenue Potbelly sells gift cards to customers, records the sale as a contract liability and recognizes the associated revenue as the gift card is redeemed. A portion of these gift cards are not redeemed by the customer ("breakage"), which is recognized as revenue as a percentage of customers gift card redemptions. The expected breakage amount recognized is determined by a historical data analysis on gift card redemption patterns. We recognize gift card breakage income within net sandwich shop sales in the consolidated statements of operations. Loyalty Program We offer a customer loyalty program for customers using the Potbelly Perks application at the point of sale. The customer will typically earn 10 points for every dollar spent, and the customer will earn a free entrée after earning 1,000 points. We defer revenue associated with the estimated selling price of points earned by Potbelly Perks members towards free entrées as each point is earned, and a corresponding liability is established in deferred revenue. The deferral is based on the estimated value of the product for which the reward is expected to be redeemed, net of estimated unredeemed points. Once a customer earns a free entrée, that entrée reward will expire after 30 days. Any point in a customer’s account that does not go toward earning a full entrée will expire after the customer's account has been inactive for a year. The breakage amount recognized is estimated based on a historical data analysis of loyalty reward redemptions and is recognized in net shop sandwich sales in the consolidated statement of operations. When points are redeemed, we recognize revenue for the redeemed product and reduce accrued expenses. |
Impairment of Long-Lived Assets | (r) Impairment of Long-Lived Assets We assess potential impairments of our long-lived assets, which include property and equipment and right-of-use assets for operating leases, whenever events or circumstances indicate that the carrying amount of an asset may not be recoverable. Assets are grouped at the individual shop-level for the purposes of the impairment assessment because a shop represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. Recoverability of an asset group is measured by a comparison of the carrying amount of an asset group to its estimated forecasted shop cash flows expected to be generated by the asset group. If the carrying amount of the asset group exceeds its estimated forecasted shop cash flows, an impairment charge is recognized as the amount by which the carrying amount of the asset exceeds the fair value of the asset group in the impairment, loss on disposal of property and equipment and shop closures in the consolidated statement of operations. The fair value of the shop assets is determined using the income approach. Key inputs to this approach include forecasted shop cash flows, discount rate, and estimated market rent, which are all classified as Level 3 inputs. See “Fair Value Measurements” above for a definition of Level 3 inputs. Upon transition of adoption to ASC 842, we impaired $0.7 million of pre-tax right-of-use assets related to previously impaired shops. This amount is recorded, net of tax, as an opening reduction to retained earnings. We recorded impairment charges of $2.8 million, $10.3 million, and $2.6 million for the fiscal years 2021, 2020, and 2019, respectively, which is included in impairment, loss on disposal of property and equipment and shop closures in the consolidated statements of operations. |
Recent Accounting Pronouncements | (s) Recent Accounting Pronouncements On December 31, 2018, we adopted Accounting Standards Update (ASU) 2016-02, “Leases (Topic 842),” along with related clarifications and improvements. This pronouncement requires lessees to recognize a liability for lease obligations, which represents the discounted obligation to make future lease payments, and a corresponding right-of-use asset on the balance sheet. The guidance requires disclosure of key information about leasing arrangements that is intended to give financial statement users the ability to assess the amount, timing, and potential uncertainty of cash flows related to leases. We elected the optional transition method to apply the standard as of the effective date and therefore, prior period amounts have not been adjusted and continue to be reported in accordance with our historical accounting under previous lease guidance. The adoption of Topic 842 had a material impact on the consolidated balance sheets and an immaterial impact on the consolidated statements of operations, consolidated statements of equity and consolidated statements of cash flows. On December 30, 2019, we adopted Accounting Standard Update No. 2016-13, Financial Instruments—Credit Losses (Topic 326) . This pronouncement requires the measurement and recognition of expected credit losses on financial instruments. ASU 2016-13 replaces the existing incurred loss model with a forward-looking expected credit loss model that requires consideration of a broader range of information to estimate credit losses. We recorded a net reduction of $5 thousand to opening accumulated deficit as of December 30, 2019, due to the cumulative impact of adopting Topic 326. On December 28, 2020, we adopted Accounting Standard Update No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging— Contracts in Entity’s Own Equity (Subtopic 815-40) . This pronouncement simplifies the accounting for certain financial instruments with liability and equity characteristics, including convertible instruments and contracts on an entity’s own equity. It removes certain criteria that previously had to be satisfied in order to classify a contract as equity and revises the guidance on calculating earnings per share, requiring use of the if-converted method for all convertible instruments and rescinding a company’s ability to rebut the presumption of share settlement for instruments that may be settled in cash or other. There was no impact to our financial statements or loss per share presentation in the period of adoption due to the impact of adopting this pronouncement. |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Dec. 26, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Current and Noncurrent Contract Liabilities from Contracts with Customers | The opening and closing balances of our current and noncurrent contract liabilities from contracts with customers were as follows: Current Contract Noncurrent Contract Beginning balance as of December 27, 2020 $ 3,138 $ 1,707 Ending balance as of December 26, 2021 6,533 1,428 Increase (decrease) in contract liability $ 3,395 $ (279) |
Summary of Expected Revenue Recognition Related to Contract Liabilities | We expect to recognize revenue related to contract liabilities as follows (in thousands), which may vary based upon franchise activity, and gift card and loyalty program redemption patterns: Years Ending Amount 2022 $ 5,543 2023 568 2024 273 2025 355 2026 145 Thereafter 1,077 Total revenue recognized $ 7,961 |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 12 Months Ended |
Dec. 26, 2021 | |
Earnings Per Share [Abstract] | |
Summary of Earnings (Loss) Per Share Calculation | The following table summarizes the earnings (loss) per share calculation (in thousands): Fiscal Year 2021 2020 2019 Net loss attributable to Potbelly Corporation $ (23,784) $ (65,391) $ (23,992) Weighted average common shares outstanding-basic 27,640 23,899 23,850 Plus: Effect of potentially dilutive shares — — — Weighted average common shares outstanding-diluted 27,640 23,899 23,850 Loss per share available to common stockholders-basic $ (0.86) $ (2.74) $ (1.01) Loss per share available to common stockholders-diluted $ (0.86) $ (2.74) $ (1.01) Potentially dilutive shares that are considered anti-dilutive: Shares 1,951 2,754 2,334 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 26, 2021 | |
Property, Plant and Equipment [Abstract] | |
Components of Property and Equipment, Net | Property and equipment, net consisted of the following (in thousands): December 26, December 27, Leasehold improvements $ 152,510 $ 158,797 Machinery and equipment 46,830 46,653 Furniture and fixtures 33,060 33,194 Computer equipment and software 37,267 36,225 Construction in progress 392 863 270,059 275,732 Less: Accumulated depreciation (220,254) (214,539) $ 49,805 $ 61,193 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Dec. 26, 2021 | |
Accrued Liabilities, Current [Abstract] | |
Summary of Accrued Expenses | Accrued expenses consisted of the following (in thousands): December 26, December 27, Accrued labor and related expenses $ 13,408 $ 7,313 Gift card liability 3,956 1,868 Deferred revenue 2,785 1,491 Accrued occupancy and utilities 2,347 3,696 Accrued sales and use tax 2,220 1,477 Accrued liability insurance 1,817 1,422 Accrued restructuring 122 1,489 Other accrued expenses 4,204 3,681 Total $ 30,859 $ 22,437 We incur expenses associated with exit activity for certain signed lease agreements, which are recognized in impairment, loss on disposal of property and equipment and shop closures in the consolidated statement of operations. Accrued contract termination costs consisted of the following (in thousands): December 26, December 27, Accrued contract termination costs—beginning balance $ — $ — Contract termination costs incurred 430 3,231 Contract termination costs settled and paid (430) (3,231) Accrued contract termination costs—ending balance $ — $ — |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 26, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income (Loss) Before Income Taxes | Income (loss) before income taxes for our domestic and foreign operations was as follows (in thousands): Fiscal Year 2021 2020 2019 Domestic operations $ (23,451) $ (72,208) $ (9,790) Foreign operations — — 395 Total $ (23,451) $ (72,208) $ (9,395) |
Components of Income Tax Expense (Benefit) | Income tax expense (benefit) consisted of the following (in thousands): Fiscal Year 2021 2020 2019 Federal: Current $ — $ (6,739) $ 159 Deferred (150) 13 9,379 (150) (6,726) 9,538 State and Local: Current 161 185 227 Deferred 161 5 4,425 322 190 4,652 Foreign: Current — — — — — — Income tax expense (benefit) $ 172 $ (6,536) $ 14,190 |
Reconciliation of Differences Between Federal Statutory and Effective Income (Loss) Tax Rate | Income tax expense (benefit) differed from the amounts computed by applying the U.S. federal income tax rates to income (loss) before income taxes as a result of the following (in thousands): Fiscal Year 2021 2020 2019 U.S. federal statutory tax 21.0% 21.0% 21.0% Computed “expected” tax benefit $ (4,959) $ (15,164) $ (1,973) Increase (reduction) resulting from: Valuation allowance 5,456 14,265 16,116 Rate change impact of net operating loss carryback — (2,592) — Minority interest 34 74 (107) Permanent differences 1,004 99 425 State and local income taxes, net of federal income tax effect (730) (3,338) (361) FICA and other tax credits (592) (248) (504) Equity compensation (237) 477 577 Other — (109) (106) Tax rate change 196 — 123 Income tax expense (benefit) $ 172 $ (6,536) $ 14,190 |
Schedule of Deferred Tax Assets and Liabilities | The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities reflected in the consolidated balance sheets are presented below (in thousands): December 26, December 27, Deferred tax assets: Net operating loss carryforwards $ 19,454 $ 14,364 Accrued liabilities 2,188 2,152 Deferred revenue 875 573 Stock-based compensation 1,304 1,993 Property and equipment 4,398 3,505 Operating lease liabilities 51,105 59,230 Tax credits and other carryforwards 2,840 2,319 Gross deferred tax assets 82,164 84,136 Valuation allowance (34,929) (30,381) Net deferred tax assets 47,235 53,755 Deferred tax liabilities: Prepaids (264) (285) Right-of-use asset for operating leases (44,973) (51,637) Intangible assets (1,319) (1,249) Smallwares (474) (482) Other (463) (348) Total deferred tax liabilities (47,493) (54,001) Net deferred tax liabilities $ (258) $ (246) |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 26, 2021 | |
Leases [Abstract] | |
Gains Recognized Upon Termination of Lease Contracts | The right-of use assets, liabilities and gains recognized upon termination of lease contracts were as follows: Fiscal Year 2021 Fiscal Year 2020 Leases terminated 3 28 Lease termination fees $ 177 $ 2,832 Right-of-use assets derecognized upon lease termination 1,433 14,774 Lease liabilities derecognized upon lease termination 1,555 16,103 Gain recognized upon lease termination $ 122 $ 1,329 |
Operating Lease Term and Discount Rate | Operating lease term and discount rate were as follows: December 26, December 27, Weighted average remaining lease term (years) 7.22 7.82 Weighted average discount rate 8.00% 7.88% |
Components of Lease Cost | The components of lease cost were as follows (in thousands): Classification Fiscal Year 2021 Fiscal Year 2020 Operating lease cost Occupancy and general and administrative expenses $ 41,091 $ 45,350 Variable lease cost Occupancy and general and administrative expenses 12,715 11,885 Total lease cost $ 53,806 $ 57,235 |
Supplemental Disclosures of Cash Flow Information Related to Leases | Supplemental disclosures of cash flow information relating to leases is as follows (in thousands): Fiscal Year 2021 Fiscal Year 2020 Operating cash flows rent paid for operating lease liabilities $ 48,099 $ 35,168 Operating right-of-use assets obtained in exchange for new operating lease liabilities 10,371 20,369 Reduction in operating right-of-use assets due to lease terminations and modifications $ 6,075 $ 14,774 |
Maturities of Lease Liabilities | Maturities of lease liabilities were as follows at December 26, 2021 (in thousands): Operating Leases 2022 $ 42,740 2023 38,104 2024 35,457 2025 32,583 2026 28,767 Thereafter 83,277 Total lease payments 260,928 Less: imputed interest (66,089) Present value of lease liabilities $ 194,839 |
Debt and _Credit Facilities (Ta
Debt and Credit Facilities (Tables) | 12 Months Ended |
Dec. 26, 2021 | |
Debt Disclosure [Abstract] | |
Component of Long-term Debt | The components of long-term debt were as follows: December 26, December 27, Revolving Credit Facility $ 9,850 $ 6,286 Paycheck Protection Program loan 10,000 10,000 Less: current portion of long-term debt (2,333) (333) Total long-term debt $ 17,517 $ 15,953 |
Restructuring (Tables)
Restructuring (Tables) | 12 Months Ended |
Dec. 26, 2021 | |
Restructuring and Related Activities [Abstract] | |
Schedule Future Cash Payments Required to Satisfy Our Remaining Obligations | The accrued restructuring balances as of December 26, 2021 represent expected future cash payments required to satisfy our remaining obligations, which are expected to be paid throughout 2022. Total (Thousands) Balance as of December 27, 2020 $ 1,489 Charges incurred — Payments made (1,367) Balance as of December 26, 2021 $ 122 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 26, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Summary of Stock Options Activity Under Plans and Agreement | A summary of stock option activity is as follows: Options Shares (Thousands) Weighted Aggregate Weighted Outstanding—December 30, 2018 2,150 $ 11.49 $ 378 5.13 Granted — — Exercised (22) 7.93 Canceled (354) 12.45 Outstanding—December 29, 2019 1,774 $ 11.34 $ — 4.33 Granted — — Exercised — — Canceled (541) 12.84 Outstanding—December 27, 2020 1,233 $ 10.68 $ — 2.49 Granted — — Exercised (31) 7.24 Canceled (664) 9.75 Outstanding—December 26, 2021 538 $ 12.03 $ — 2.35 Exercisable—December 26, 2021 534 $ 12.02 $ — 2.32 |
Summary of RSU Activity | A summary of RSU activity is as follows: RSUs Number of RSUs (Thousands) Weighted Average Non-vested as of December 30, 2018 247 $ 11.99 Granted 402 6.47 Vested (135) 11.94 Canceled (51) 8.48 Non-vested as of December 29, 2019 463 $ 7.59 Granted 1,604 2.79 Vested (231) 2.87 Canceled (842) 3.65 Non-vested as of December 27, 2020 994 $ 3.35 Granted 649 6.16 Vested (479) 7.05 Canceled (13) 3.50 Non-vested as of December 26, 2021 1,151 $ 4.87 |
Summary of PSU Activity | A summary of activity for PSUs with market vesting conditions is as follows: PSUs Number of PSUs Weighted Average Non-vested as of December 27, 2020 502 $ 1.38 Granted 130 8.43 Vested (502) 6.76 Canceled — 0.00 Non-vested as of December 26, 2021 130 $ 8.43 |
Organization and Other Matters
Organization and Other Matters - Additional Information (Detail) | Dec. 26, 2021Shop |
Nature Of Business And Basis Of Presentation [Line Items] | |
Number of shops franchisees operate | 46 |
Minimum | |
Nature Of Business And Basis Of Presentation [Line Items] | |
Number of shops Potbelly Corporation owns or operates | 397 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Additional Information (Detail) | 12 Months Ended | ||
Dec. 26, 2021USD ($)SegmentSubsidiaryJointVenture | Dec. 27, 2020USD ($) | Dec. 29, 2019USD ($) | |
Summary Of Significant Accounting Policies [Line Items] | |||
Number of wholly owned subsidiaries | Subsidiary | 7 | ||
Number of joint ventures | JointVenture | 6 | ||
Number of operating segments | Segment | 1 | ||
Number of reportable segments | Segment | 1 | ||
Recognized impairment for intangible assets | $ 0 | $ 0 | $ 0 |
Advertising | 2,999,000 | 1,020,000 | 4,111,000 |
impairment of long lived assets | $ 2,800,000 | 10,300,000 | 2,600,000 |
ASU 2016-02 (Topic 842) | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Operating lease impairment loss | $ 700,000 | ||
ASU 2016-13 (Topic 326) | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Reduction in accumulated deficit | $ 5,000 | ||
Minimum | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Ownership interest rate | 51.00% | ||
Minimum | Machinery and Equipment | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Property and equipment estimated useful life | 3 years | ||
Minimum | Computer Equipment | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Property and equipment estimated useful life | 3 years | ||
Minimum | Furniture and Fixtures | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Property and equipment estimated useful life | 3 years | ||
Minimum | Leasehold Improvements | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Property and equipment estimated useful life | 10 years | ||
Minimum | Computer Software | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Property and equipment estimated useful life | 3 years | ||
Maximum | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Ownership interest rate | 80.00% | ||
Maximum | Machinery and Equipment | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Property and equipment estimated useful life | 5 years | ||
Maximum | Computer Equipment | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Property and equipment estimated useful life | 5 years | ||
Maximum | Furniture and Fixtures | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Property and equipment estimated useful life | 5 years | ||
Maximum | Leasehold Improvements | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Property and equipment estimated useful life | 15 years | ||
Maximum | Computer Software | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Property and equipment estimated useful life | 5 years |
Revenue - Additional Informatio
Revenue - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 26, 2021 | Dec. 27, 2020 | Dec. 29, 2019 | |
Disaggregation Of Revenue [Line Items] | |||
Amount of revenue recognized | $ 380,052 | $ 291,281 | $ 409,707 |
Revenue recognized related to prior periods | 200 | 200 | $ 200 |
Aggregate value of remaining performance obligation on outstanding contracts | $ 7,961 | ||
Minimum | Furniture and Fixtures | |||
Disaggregation Of Revenue [Line Items] | |||
Property and equipment estimated useful life | 3 years | ||
Minimum | Computer Equipment | |||
Disaggregation Of Revenue [Line Items] | |||
Property and equipment estimated useful life | 3 years | ||
Minimum | Machinery and Equipment | |||
Disaggregation Of Revenue [Line Items] | |||
Property and equipment estimated useful life | 3 years | ||
December 30, 2019 Liability Ending Balance | |||
Disaggregation Of Revenue [Line Items] | |||
Amount of revenue recognized | $ 1,100 | 1,100 | |
Point in Time Sales | |||
Disaggregation Of Revenue [Line Items] | |||
Amount of revenue recognized | 379,300 | 290,700 | |
Over Time Sales | |||
Disaggregation Of Revenue [Line Items] | |||
Amount of revenue recognized | $ 800 | $ 600 |
Revenue - Summary of Current an
Revenue - Summary of Current and Noncurrent Contract Liabilities from Contracts with Customers (Detail) $ in Thousands | 12 Months Ended |
Dec. 26, 2021USD ($) | |
Revenue from Contract with Customer [Abstract] | |
Beginning balance of current contract liability | $ 3,138 |
Ending balance of current contract liability | 6,533 |
Increase (decrease) in contract liability | 3,395 |
Beginning balance of noncurrent contract liability | 1,707 |
Ending balance of noncurrent contract liability | 1,428 |
Increase (decrease) in contract liability | $ (279) |
Revenue - Summary of Expected R
Revenue - Summary of Expected Revenue Recognition Related to Contract Liabilities (Detail1) $ in Thousands | Dec. 26, 2021USD ($) |
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | |
Revenue, remaining performance obligations | $ 7,961 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2022-01-01 | |
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | |
Revenue, remaining performance obligations | $ 5,543 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2023-01-01 | |
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | |
Revenue, remaining performance obligations | $ 568 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2024-01-01 | |
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | |
Revenue, remaining performance obligations | $ 273 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2025-01-01 | |
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | |
Revenue, remaining performance obligations | $ 355 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2026-01-01 | |
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | |
Revenue, remaining performance obligations | $ 145 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2027-01-01 | |
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | |
Revenue, remaining performance obligations | $ 1,077 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue - Summary of Expected_2
Revenue - Summary of Expected Revenue Recognition Related to Contract Liabilities (Detail) $ in Thousands | Dec. 26, 2021USD ($) |
Revenue from Contract with Customer [Abstract] | |
Aggregate value of remaining performance obligation on outstanding contracts | $ 7,961 |
Earnings (Loss) Per Share - Add
Earnings (Loss) Per Share - Additional Information (Detail) - shares | 12 Months Ended | ||
Dec. 26, 2021 | Dec. 27, 2020 | Dec. 29, 2019 | |
Earnings (Loss) Per Share [Line Items] | |||
Potential common shares included in diluted shares outstanding (in shares) | 1,951,000 | 2,754,000 | 2,334,000 |
Common Share Options | |||
Earnings (Loss) Per Share [Line Items] | |||
Potential common shares included in diluted shares outstanding (in shares) | 0 |
Earnings (Loss) Per Share - Sum
Earnings (Loss) Per Share - Summary of Earnings (Loss) Per Share Calculation (Detail) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 26, 2021 | Dec. 27, 2020 | Dec. 29, 2019 | |
Earnings Per Share [Abstract] | |||
Net loss attributable to Potbelly Corporation | $ (23,784) | $ (65,391) | $ (23,992) |
Basic (in shares) | 27,640,000 | 23,899,000 | 23,850,000 |
Weighted average common shares outstanding-diluted (in shares) | 27,640,000 | 23,899,000 | 23,850,000 |
Loss per share available to common stockholders-basic (in usd per share) | $ (0.86) | $ (2.74) | $ (1.01) |
Loss per share available to common stockholders-diluted (in usd per share) | $ (0.86) | $ (2.74) | $ (1.01) |
Potentially dilutive shares that are considered anti-dilutive (in shares) | 1,951,000 | 2,754,000 | 2,334,000 |
Property and Equipment - Compon
Property and Equipment - Components of Property and Equipment (Detail) - USD ($) $ in Thousands | Dec. 26, 2021 | Dec. 27, 2020 |
Property, Plant and Equipment [Abstract] | ||
Leasehold improvements | $ 152,510 | $ 158,797 |
Machinery and equipment | 46,830 | 46,653 |
Furniture and fixtures | 33,060 | 33,194 |
Computer equipment and software | 37,267 | 36,225 |
Construction in progress | 392 | 863 |
Property and equipment, gross | 270,059 | 275,732 |
Less: Accumulated depreciation | (220,254) | (214,539) |
Property and equipment, net | $ 49,805 | $ 61,193 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Mar. 28, 2021 | Dec. 26, 2021 | Dec. 27, 2020 | Dec. 29, 2019 | |
Property, Plant and Equipment [Line Items] | ||||
Losses on disposal of property and equipment | $ 2.4 | $ 0.5 | $ 0.4 | |
Leasehold Improvements | ||||
Property, Plant and Equipment [Line Items] | ||||
Gain (Loss) on Disposition of Other Assets | $ 2.5 |
Accrued Expenses - Summary of A
Accrued Expenses - Summary of Accrued Expenses (Detail) - USD ($) $ in Thousands | Dec. 26, 2021 | Dec. 27, 2020 |
Accrued Liabilities and Other Liabilities [Abstract] | ||
Accrued labor and related expenses | $ 13,408 | $ 7,313 |
Gift card liability | 3,956 | 1,868 |
Deferred revenue | 2,785 | 1,491 |
Accrued occupancy and utilities | 2,347 | 3,696 |
Accrued sales and use tax | 2,220 | 1,477 |
Accrued liability insurance | 1,817 | 1,422 |
Accrued restructuring | 122 | 1,489 |
Other accrued expenses | 4,204 | 3,681 |
Total | $ 30,859 | $ 22,437 |
Accrued Expenses - Summary of_2
Accrued Expenses - Summary of Accrued Contract Termination Costs (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 26, 2021 | Dec. 27, 2020 | |
Accrued Liabilities and Other Liabilities [Abstract] | ||
Accrued contract termination costs—beginning balance | $ 0 | $ 0 |
Contract termination costs incurred | 430 | 3,231 |
Contract termination costs settled and paid | (430) | (3,231) |
Accrued contract termination costs—ending balance | $ 0 | $ 0 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 12 Months Ended | ||||
Dec. 26, 2021 | Dec. 27, 2020 | Dec. 29, 2019 | Mar. 27, 2020 | Mar. 31, 2019 | |
Income Tax [Line Items] | |||||
Income Tax Expense (Benefit) | $ 172,000 | $ (6,536,000) | $ 14,190,000 | ||
Net operating loss carryforwards | 19,454,000 | 14,364,000 | |||
Deferred tax assets, valuation allowance | 34,929,000 | 30,381,000 | $ 13,600,000 | ||
Unrecognized tax benefits, income tax penalties and interest accrued | 0 | 0 | |||
Uncertain tax positions | 0 | 0 | |||
COVID 19 | |||||
Income Tax [Line Items] | |||||
Tax refund from net operating loss carryback | $ 6,700,000 | ||||
CARES Act Of 2020 | |||||
Income Tax [Line Items] | |||||
Income Tax Expense (Benefit) | 6,700,000 | ||||
Valuation Allowance Tax Credit Carryforward [Member] | |||||
Income Tax [Line Items] | |||||
Deferred tax assets, valuation allowance | 34,900,000 | 30,400,000 | |||
Federal and State Income Tax [Member] | |||||
Income Tax [Line Items] | |||||
Net operating loss carryforwards | $ 19,500,000 | $ 14,300,000 |
Income Taxes - Schedule of Inco
Income Taxes - Schedule of Income (Loss) Before Income Taxes (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 26, 2021 | Dec. 27, 2020 | Dec. 29, 2019 | |
Income Tax Disclosure [Abstract] | |||
Domestic operations | $ (23,451) | $ (72,208) | $ (9,790) |
Foreign operations | 0 | 0 | 395 |
Total | $ (23,451) | $ (72,208) | $ (9,395) |
Income Taxes - Components of In
Income Taxes - Components of Income Tax Expense (Benefit) (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 26, 2021 | Dec. 27, 2020 | Dec. 29, 2019 | |
Income Tax Disclosure [Abstract] | |||
Federal, current | $ 0 | $ (6,739) | $ 159 |
Federal, deferred | (150) | 13 | 9,379 |
Federal, total | (150) | (6,726) | 9,538 |
State and local, current | 161 | 185 | 227 |
State and local, deferred | 161 | 5 | 4,425 |
State and local, total | 322 | 190 | 4,652 |
Foreign, current | 0 | 0 | 0 |
Foreign, total | 0 | 0 | 0 |
Income tax expense (benefit) | $ 172 | $ (6,536) | $ 14,190 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Differences Between Federal Statutory and Effective Income (Loss) Tax Rate (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 26, 2021 | Dec. 27, 2020 | Dec. 29, 2019 | |
Income Tax Disclosure [Abstract] | |||
U.S. federal statutory tax | 21.00% | 21.00% | 21.00% |
Computed “expected” tax benefit | $ (4,959) | $ (15,164) | $ (1,973) |
Increase (reduction) resulting from: | |||
Valuation allowance | 5,456 | 14,265 | 16,116 |
Rate change impact of net operating loss carryback | 0 | (2,592) | 0 |
Minority interest | 34 | 74 | (107) |
Permanent differences | 1,004 | 99 | 425 |
State and local income taxes, net of federal income tax effect | (730) | (3,338) | (361) |
FICA and other tax credits | (592) | (248) | (504) |
Equity compensation | (237) | 477 | 577 |
Other | 0 | (109) | (106) |
Tax rate change | 196 | 0 | 123 |
Income tax expense (benefit) | $ 172 | $ (6,536) | $ 14,190 |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Thousands | Dec. 26, 2021 | Dec. 27, 2020 | Mar. 31, 2019 |
Deferred tax assets: | |||
Net operating loss carryforwards | $ 19,454 | $ 14,364 | |
Accrued liabilities | 2,188 | 2,152 | |
Deferred revenue | 875 | 573 | |
Stock-based compensation | 1,304 | 1,993 | |
Property and equipment | 4,398 | 3,505 | |
Operating lease liabilities | 51,105 | 59,230 | |
Tax credits and other carryforwards | 2,840 | 2,319 | |
Gross deferred tax assets | 82,164 | 84,136 | |
Valuation allowance | (34,929) | (30,381) | $ (13,600) |
Net deferred tax assets | 47,235 | 53,755 | |
Deferred tax liabilities: | |||
Prepaids | (264) | (285) | |
Right-of-use asset for operating leases | (44,973) | (51,637) | |
Intangible assets | (1,319) | (1,249) | |
Smallwares | (474) | (482) | |
Other | (463) | (348) | |
Total deferred tax liabilities | (47,493) | (54,001) | |
Net deferred tax liabilities | $ (258) | $ (246) |
Leases - Gains Recognized Upon
Leases - Gains Recognized Upon Termination of Lease Contracts (Detail) $ in Thousands | 12 Months Ended | |
Dec. 26, 2021USD ($)storeTermination | Dec. 27, 2020USD ($)Termination | |
Leases [Abstract] | ||
Number of shops with lease amendments | store | 335 | |
Leases terminated | Termination | 3 | 28 |
Lease termination fees | $ 177 | $ 2,832 |
Right-of-use assets derecognized upon lease termination | 1,433 | 14,774 |
Lease liabilities derecognized upon lease termination | 1,555 | 16,103 |
Gain recognized upon lease termination | $ 122 | $ 1,329 |
Leases - Operating Lease Term a
Leases - Operating Lease Term and Discount Rate (Detail) | Dec. 26, 2021 | Dec. 27, 2020 |
Leases [Abstract] | ||
Weighted average remaining lease term (years) | 7 years 2 months 19 days | 7 years 9 months 25 days |
Weighted average discount rate | 8.00% | 7.88% |
Leases - Components of Lease Co
Leases - Components of Lease Cost (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 26, 2021 | Dec. 27, 2020 | |
Lessee Lease Description [Line Items] | ||
Total lease cost | $ 53,806 | $ 57,235 |
Occupancy And General And Administrative Expenses [Member] | ||
Lessee Lease Description [Line Items] | ||
Operating lease cost | 41,091 | 45,350 |
Variable lease cost | $ 12,715 | $ 11,885 |
Leases - Supplemental Disclosur
Leases - Supplemental Disclosures of Cash Flow Information Related to Leases (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 26, 2021 | Dec. 27, 2020 | |
Leases [Abstract] | ||
Operating cash flows rent paid for operating lease liabilities | $ 48,099 | $ 35,168 |
Operating right-of-use assets obtained in exchange for new operating lease liabilities | 10,371 | 20,369 |
Reduction in operating right-of-use assets due to lease terminations and modifications | $ 6,075 | $ 14,774 |
Leases - Maturities of Lease Li
Leases - Maturities of Lease Liabilities (Detail) $ in Thousands | Dec. 26, 2021USD ($) |
Operating Leases | |
2022 | $ 42,740 |
2023 | 38,104 |
2024 | 35,457 |
2025 | 32,583 |
2026 | 28,767 |
Thereafter | 83,277 |
Total lease payments | 260,928 |
Less: imputed interest | (66,089) |
Present value of lease liabilities | $ 194,839 |
Debt and Credit Facilities - Ad
Debt and Credit Facilities - Additional Information (Detail) - USD ($) | Jan. 28, 2022 | Feb. 26, 2021 | Aug. 10, 2020 | Aug. 07, 2019 | Feb. 25, 2021 |
JPMorgan Chase Bank, N.A. | |||||
Debt Instrument [Line Items] | |||||
Commitment fee, percentage | 0.20% | ||||
Revolving Credit Facility | JPMorgan Chase Bank, N.A. | |||||
Debt Instrument [Line Items] | |||||
Credit facility agreement, maximum principal amount | $ 40,000,000 | ||||
Revolving Credit Facility | JPMorgan Chase Bank, N.A. | Maximum Increase | |||||
Debt Instrument [Line Items] | |||||
Credit facility agreement, future increases | $ 20,000,000 | ||||
Paycheck Protection Program Loan | Harvest Small Business Finance | Commercial Loan | Potbelly Sandwich Works, LLC | |||||
Debt Instrument [Line Items] | |||||
Loan amount | $ 10,000,000 | ||||
Paycheck Protection Program Loan | CARES Act Of 2020 | Potbelly Sandwich Works, LLC | |||||
Debt Instrument [Line Items] | |||||
Credit facility agreement, interest rate | 1.00% | ||||
Loan maturity period | 5 years | ||||
Revolving Credit Commitment | CARES Act Of 2020 | Fifth Credit Agreement Amendment | |||||
Debt Instrument [Line Items] | |||||
Credit facility agreement, maximum principal amount | $ 25,000,000 | $ 40,000,000 | |||
CBFR Loan | Sixth Credit Agreement Amendment | Subsequent Event | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, increase in interest rate | 75.00% | ||||
CBFR Loan | CARES Act Of 2020 | Fifth Credit Agreement Amendment | |||||
Debt Instrument [Line Items] | |||||
Credit facility agreement, interest rate | 2.75% | ||||
Eurodollar Loan | CARES Act Of 2020 | Fifth Credit Agreement Amendment | |||||
Debt Instrument [Line Items] | |||||
Credit facility agreement, interest rate | 5.00% | ||||
Term Benchmark Loan | Sixth Credit Agreement Amendment | Subsequent Event | |||||
Debt Instrument [Line Items] | |||||
Debt Instrument, Interest Rate, Stated Percentage | 600.00% |
Debt and Credit Facilities - Co
Debt and Credit Facilities - Component of Long-term Debt (Detail) - USD ($) $ in Thousands | Dec. 26, 2021 | Dec. 27, 2020 |
Debt Instrument [Line Items] | ||
Less: current portion of long-term debt | $ (2,333) | $ (333) |
Long-term debt, net of current portion | 17,517 | 15,953 |
Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Long-term debt | 9,850 | 6,286 |
Paycheck Protection Program Loan | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 10,000 | $ 10,000 |
Restructuring - Additional Info
Restructuring - Additional Information (Detail) | 3 Months Ended |
Dec. 26, 2021Employee | |
Restructuring and Related Activities [Abstract] | |
Number of employee reduce | 35 |
Restructuring - Schedule Future
Restructuring - Schedule Future Cash Payments Required to Satisfy Our Remaining Obligations (Detail) $ in Thousands | 12 Months Ended |
Dec. 26, 2021USD ($) | |
Restructuring Reserve [Roll Forward] | |
Balance as of December 27, 2020 | $ 1,489 |
Charges incurred | 0 |
Payments made | (1,367) |
Balance as of December 26, 2021 | $ 122 |
Capital Stock - Additional Info
Capital Stock - Additional Information (Detail) - USD ($) | Nov. 03, 2021 | Feb. 09, 2021 | Dec. 26, 2021 | Dec. 29, 2019 | Dec. 27, 2020 | May 08, 2018 |
Capital Unit [Line Items] | ||||||
Capital stock, authorized (in shares) | 210,000,000 | 210,000,000 | ||||
Common stock, authorized (in shares) | 200,000,000 | 200,000,000 | ||||
Preferred stock, authorized (in shares) | 10,000,000 | 10,000,000 | ||||
Common stock, issued (in shares) | 38,164,000 | 33,935,000 | ||||
Common stock, outstanding (in shares) | 28,380,000 | 24,323,000 | ||||
Stock repurchase program, authorized amount | $ 65,000,000 | |||||
Common stock repurchased (in shares) | $ 4,217,000 | |||||
Share repurchase program, remaining dollar value | $ 37,900,000 | |||||
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 | ||||
Warrants | ||||||
Capital Unit [Line Items] | ||||||
Placement agent fees and offering expenses | $ 1,000,000 | |||||
Securities Purchase Agreement | ||||||
Capital Unit [Line Items] | ||||||
Issuance of common stock (in shares) | 3,249,668 | |||||
Common stock, par value (in usd per share) | $ 0.01 | |||||
Securities Purchase Agreement | Warrants | ||||||
Capital Unit [Line Items] | ||||||
Issuance of common stock (in shares) | 1,299,861 | |||||
Exercise price (in usd per share) | $ 5.45 | |||||
Proceeds from securities purchase agreement | $ 16,000,000 | |||||
William Blair | ||||||
Capital Unit [Line Items] | ||||||
Issuance of common stock (in shares) | 40,000,000 | |||||
Stock Repurchase Program | ||||||
Capital Unit [Line Items] | ||||||
Common stock shares repurchased (in shares) | 0 | |||||
Common stock repurchased (in shares) | $ 0 |
Employee Benefit Plan - Additio
Employee Benefit Plan - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 26, 2021 | Dec. 27, 2020 | Dec. 29, 2019 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Disclosures [Abstract] | |||
Contributions made to profit sharing plan | $ 0.3 | $ 0.2 | $ 0.5 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | Jun. 24, 2020 | Dec. 26, 2021 | Dec. 27, 2020 | Dec. 29, 2019 | May 16, 2019 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock-based compensation expense | $ 2,137 | $ 2,515 | $ 2,335 | ||
Employee And Non Employee Director | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Options granted (in shares) | 0 | 0 | 0 | ||
Stock Options | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Exercisable period from the date of grant | 10 years | ||||
Accounting Standards Update 2016-09 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares of common stock reserved for issuance (in shares) | 626,000 | ||||
Restricted Stock Units (RSUs) | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Restricted stock units granted (in shares) | 649,000 | 1,604,000 | 402,000 | ||
Stock-based compensation expense | $ 1,600 | $ 1,500 | $ 1,500 | ||
Unrecognized stock compensation expense | $ 4,200 | ||||
Restricted Stock Units (RSUs) | First Anniversary | Non-Employee Board Of Directors | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting percentage | 50.00% | ||||
Restricted Stock Units (RSUs) | Second Anniversary | Non-Employee Board Of Directors | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting percentage | 50.00% | ||||
Common Share Options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock-based compensation expense | $ 100 | 100 | $ 800 | ||
Unrecognized stock compensation expense | $ 100 | ||||
Performance Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Restricted stock units granted (in shares) | 130,000 | ||||
Performance Stock Units | Market Vesting Conditions | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock-based compensation expense | $ 500 | $ 900 | |||
2019 Plan Amanded and Restated | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of common shares authorized for issuance (in shares) | 2,100,000 | ||||
2019 Plan Amanded and Restated | Common Stock | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of common shares authorized for issuance (in shares) | 900,000 | ||||
2019 Long Term Incentive Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares of common stock reserved for issuance (in shares) | 1,568,000 | ||||
Exercise price of options outstanding, lower limit (in usd per share) | $ 8.16 | ||||
Exercise price of options outstanding, higher limit (in usd per share) | $ 20.53 | ||||
2019 Long Term Incentive Plan | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Options vesting period | 5 years | ||||
2019 Long Term Incentive Plan | Minimum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Options vesting period | 4 years | ||||
2019 Long Term Incentive Plan | Common Stock | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares of common stock reserved for issuance (in shares) | 1,200,000 | ||||
2019 Long Term Incentive Plan | Restricted Stock Units (RSUs) | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Restricted stock units granted (in shares) | 3,687,000 |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Stock Options Activity Under Plans and Agreement (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 26, 2021 | Dec. 27, 2020 | Dec. 29, 2019 | Dec. 30, 2018 | |
Shares (Thousands) | ||||
Beginning balance (in shares) | 1,233 | 1,774 | 2,150 | |
Exercised (in shares) | (31) | 0 | (22) | |
Canceled (in shares) | (664) | (541) | (354) | |
Ending balance (in shares) | 538 | 1,233 | 1,774 | 2,150 |
Exercisable (in shares) | 534 | |||
Weighted Average Exercise Price | ||||
Outstanding at beginning balance (in usd per share) | $ 10.68 | $ 11.34 | $ 11.49 | |
Exercised (in usd per share) | 7.24 | 0 | 7.93 | |
Canceled (in usd per share) | 9.75 | 12.84 | 12.45 | |
Outstanding at ending balance (in usd per share) | 12.03 | $ 10.68 | $ 11.34 | $ 11.49 |
Exercisable (in usd per share) | $ 12.02 | |||
Aggregate intrinsic value | $ 0 | $ 0 | $ 0 | $ 378 |
Options exercisable aggregate intrinsic value | $ 0 | |||
Weighted Average Remaining Term (Years) | ||||
Weighted average remaining term | 2 years 4 months 6 days | 2 years 5 months 26 days | 4 years 3 months 29 days | 5 years 1 month 17 days |
Options exercisable weighted average remaining term | 2 years 3 months 25 days |
Stock-Based Compensation - Su_2
Stock-Based Compensation - Summary of RSU Activity (Detail) - Restricted Stock Units (RSUs) - $ / shares shares in Thousands | 12 Months Ended | ||
Dec. 26, 2021 | Dec. 27, 2020 | Dec. 29, 2019 | |
Number of RSUs (Thousands) | |||
Non-vested beginning balance (in shares) | 994 | 463 | 247 |
Restricted stock units granted (in shares) | 649 | 1,604 | 402 |
Vested (in shares) | (479) | (231) | (135) |
Canceled (in shares) | (13) | (842) | (51) |
Non-vested ending balance (in shares) | 1,151 | 994 | 463 |
Weighted Average Fair Value per Share | |||
Weighted average fair value beginning balance (in usd per share) | $ 3.35 | $ 7.59 | $ 11.99 |
Weighted average fair value, granted (in usd per share) | 6.16 | 2.79 | 6.47 |
Weighted average fair value, vested (in usd per share) | 7.05 | 2.87 | 11.94 |
Weighted average fair value, canceled (in usd per share) | 3.50 | 3.65 | 8.48 |
Weighted average fair value ending balance (in usd per share) | $ 4.87 | $ 3.35 | $ 7.59 |
Stock-Based Compensation - Su_3
Stock-Based Compensation - Summary of PSU Activity (Detail) - Performance Stock Units shares in Thousands | 12 Months Ended |
Dec. 26, 2021$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Non-vested beginning balance (in shares) | shares | 502 |
Granted (in shares) | shares | 130 |
Vested (in shares) | shares | (502) |
Canceled (in shares) | shares | 0 |
Non-vested ending balance (in shares) | shares | 130 |
Weighted average fair value beginning balance (in usd per share) | $ / shares | $ 1.38 |
Weighted Average Fair Value per Share, Granted | $ / shares | 8.43 |
Weighted average fair value, vested (in usd per share) | $ / shares | 6.76 |
Weighted average fair value, canceled (in usd per share) | $ / shares | 0 |
Weighted average fair value ending balance (in usd per share) | $ / shares | $ 8.43 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Detail) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended |
Feb. 28, 2021 | Dec. 26, 2021 | |
Related Party Transaction [Line Items] | ||
Stock issued during period, value | $ 14,839 | |
Warrants | ||
Related Party Transaction [Line Items] | ||
Stock issued during period, value | $ 2,566 | |
Minimum | Private Placement | ||
Related Party Transaction [Line Items] | ||
Ownership percentage related party | 5.00% | |
Maximum | Private Placement | ||
Related Party Transaction [Line Items] | ||
Ownership percentage related party | 8.50% | |
One Hundred Eighty Degree Capital Corp | Private Placement | ||
Related Party Transaction [Line Items] | ||
Issuance of common stock (in shares) | 201,514 | |
One Hundred Eighty Degree Capital Corp | Private Placement | Warrants | ||
Related Party Transaction [Line Items] | ||
Issuance of common stock (in shares) | 80,605 | |
Stock issued during period, value | $ 1,000 | |
B W Pension Trust | Private Placement | ||
Related Party Transaction [Line Items] | ||
Issuance of common stock (in shares) | 164,875 | |
B W Pension Trust | Private Placement | Warrants | ||
Related Party Transaction [Line Items] | ||
Issuance of common stock (in shares) | 65,950 | |
Stock issued during period, value | $ 800 | |
Agman Investments L L C | Private Placement | ||
Related Party Transaction [Line Items] | ||
Issuance of common stock (in shares) | 223,904 | |
Agman Investments L L C | Private Placement | Warrants | ||
Related Party Transaction [Line Items] | ||
Issuance of common stock (in shares) | 89,561 | |
Stock issued during period, value | $ 1,100 | |
Ancora Holdings Inc | Private Placement | ||
Related Party Transaction [Line Items] | ||
Issuance of common stock (in shares) | 366,389 | |
Ancora Holdings Inc | Private Placement | Warrants | ||
Related Party Transaction [Line Items] | ||
Issuance of common stock (in shares) | 146,555 | |
Stock issued during period, value | $ 1,800 | |
Lakes Investment Fund L L C | Private Placement | ||
Related Party Transaction [Line Items] | ||
Issuance of common stock (in shares) | 193,372 | |
Lakes Investment Fund L L C | Private Placement | Warrants | ||
Related Party Transaction [Line Items] | ||
Issuance of common stock (in shares) | 77,348 | |
Stock issued during period, value | $ 900 | |
Intrinsic Investment Holdings L L C | Private Placement | ||
Related Party Transaction [Line Items] | ||
Issuance of common stock (in shares) | 407,099 | |
Stock issued during period, value | $ 2,000 |