Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Mar. 27, 2016 | May. 04, 2016 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Diversified Restaurant Holdings, Inc. | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --12-25 | |
Entity Common Stock, Shares Outstanding | 26,334,193 | |
Amendment Flag | false | |
Entity Central Index Key | 1,394,156 | |
Entity Filer Category | Accelerated Filer | |
Document Period End Date | Mar. 27, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q1 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) | Mar. 27, 2016 | Dec. 27, 2015 |
Current assets | ||
Cash and cash equivalents | $ 5,336,494 | $ 14,200,528 |
Accounts receivable | 844,198 | 620,942 |
Inventory | 1,936,541 | 1,934,584 |
Prepaid assets | 1,290,527 | 1,618,429 |
Total current assets | 9,407,760 | 18,374,483 |
Deferred income taxes | 14,000,323 | 13,320,177 |
Property and equipment, net | 82,335,422 | 79,189,661 |
Intangible assets, net | 3,521,846 | 3,638,716 |
Goodwill | 50,097,081 | 50,097,081 |
Other long-term assets | 1,194,170 | 1,152,377 |
Total assets | 160,556,602 | 165,772,495 |
Current liabilities | ||
Accounts payable | 7,444,625 | 7,807,552 |
Accrued compensation | 1,862,394 | 3,087,883 |
Other accrued liabilities | 3,482,503 | 3,663,211 |
Current portion of long-term debt | 9,842,417 | 9,891,825 |
Current portion of deferred rent | 332,948 | 396,113 |
Total current liabilities | 22,964,887 | 24,846,584 |
Deferred rent, less current portion | 2,905,992 | 2,826,210 |
Unfavorable operating leases | 651,477 | 671,553 |
Other long-term liabilities | 5,684,827 | 4,463,631 |
Long-term debt, less current portion | 112,259,339 | 116,364,165 |
Total liabilities | $ 144,466,522 | $ 149,172,143 |
Commitments and contingencies (Notes 9 and 10) | ||
Stockholders' equity | ||
Common stock - $0.0001 par value; 100,000,000 shares authorized; 26,297,068 and 26,298,725, respectively, issued and outstanding | $ 2,585 | $ 2,584 |
Additional paid-in capital | 36,244,464 | 36,136,332 |
Accumulated other comprehensive loss | (2,055,477) | (1,006,667) |
Accumulated deficit | (18,101,492) | (18,531,897) |
Total stockholders' equity | 16,090,080 | 16,600,352 |
Total liabilities and stockholders' equity | $ 160,556,602 | $ 165,772,495 |
Consolidated Balance Sheets (U3
Consolidated Balance Sheets (Unaudited) (Parentheticals) - $ / shares | Mar. 27, 2016 | Dec. 27, 2015 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 26,297,068 | 26,298,725 |
Common stock, shares outstanding | 26,297,068 | 26,298,725 |
Consolidated Statements of Inco
Consolidated Statements of Income (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 27, 2016 | Mar. 29, 2015 | |
Income Statement [Abstract] | ||
Revenue | $ 48,412,799 | $ 39,440,332 |
Restaurant operating costs (exclusive of depreciation and amortization shown separately below): | ||
Food, beverage, and packaging costs | 13,695,543 | 11,447,903 |
Compensation costs | 12,511,941 | 10,154,792 |
Occupancy costs | 3,170,755 | 2,372,467 |
Other operating costs | 10,038,844 | 7,960,549 |
General and administrative expenses | 2,662,758 | 2,496,887 |
Pre-opening costs | 272,364 | 1,093,500 |
Depreciation and amortization | 4,307,717 | 3,157,322 |
Loss on disposal of property and equipment | 66,128 | 148,408 |
Total operating expenses | 46,726,050 | 38,831,828 |
Operating profit | 1,686,749 | 608,504 |
Interest expense | (1,444,940) | (432,223) |
Other income, net | 45,272 | 17,003 |
Income before income taxes | 287,081 | 193,284 |
Income tax benefit | (143,324) | (69,358) |
Net income | $ 430,405 | $ 262,642 |
Basic earnings per share (in dollars per share) | $ 0.02 | $ 0.01 |
Fully diluted earnings per share (in dollars per share) | $ 0.02 | $ 0.01 |
Weighted average number of common shares outstanding | ||
Basic (in shares) | 26,298,034 | 26,149,184 |
Diluted (in shares) | 26,298,034 | 26,248,424 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 27, 2016 | Mar. 29, 2015 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 430,405 | $ 262,642 |
Other comprehensive loss | ||
Unrealized changes in fair value of interest rate swaps, net of tax of $540,296, and $161,691, respectively | (1,048,810) | (313,873) |
Unrealized changes in fair value of investments, net of tax of $0 and $1,959 , respectively | 0 | 3,804 |
Total other comprehensive loss | (1,048,810) | (310,069) |
Comprehensive loss | $ (618,405) | $ (47,427) |
Consolidated Statements of Com6
Consolidated Statements of Comprehensive Income (Loss) (Unaudited) (Parentheticals) - USD ($) | 3 Months Ended | |
Mar. 27, 2016 | Mar. 29, 2015 | |
Statement of Comprehensive Income [Abstract] | ||
Unrealized changes in fair value of interest rate swaps, tax | $ 540,296 | $ 161,691 |
Unrealized changes in fair value of investments, tax | $ 0 | $ 1,959 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings |
Balance (in shares) at Dec. 28, 2014 | 26,149,824 | ||||
Balance at Dec. 28, 2014 | $ 33,156,022 | $ 2,582 | $ 35,668,001 | $ (175,156) | $ (2,339,405) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Forfeitures of restricted shares (in shares) | (1,917) | ||||
Employee stock purchase plan (in shares) | 4,662 | ||||
Employee stock purchase plan | 19,222 | 19,222 | |||
Share-based compensation | 55,793 | 55,793 | |||
Other comprehensive income (loss) | (310,069) | (310,069) | |||
Net income | 262,642 | 262,642 | |||
Balance at Mar. 29, 2015 | $ 33,183,610 | $ 2,582 | 35,743,016 | (485,225) | (2,076,763) |
Balance (in shares) at Mar. 29, 2015 | 26,152,569 | ||||
Balance (in shares) at Dec. 27, 2015 | 26,298,725 | 26,298,725 | |||
Balance at Dec. 27, 2015 | $ 16,600,352 | $ 2,584 | 36,136,332 | (1,006,667) | (18,531,897) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of restricted shares (in shares) | 3,500 | ||||
Forfeitures of restricted shares (in shares) | (10,766) | ||||
Employee stock purchase plan (in shares) | 5,609 | ||||
Employee stock purchase plan | 10,707 | $ 1 | 10,706 | ||
Share-based compensation | 97,426 | 97,426 | |||
Other comprehensive income (loss) | (1,048,810) | (1,048,810) | |||
Net income | 430,405 | 430,405 | |||
Balance at Mar. 27, 2016 | $ 16,090,080 | $ 2,585 | $ 36,244,464 | $ (2,055,477) | $ (18,101,492) |
Balance (in shares) at Mar. 27, 2016 | 26,297,068 | 26,297,068 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 27, 2016 | Mar. 29, 2015 | |
Net income | ||
Net income | $ 430,405 | $ 262,642 |
Adjustments to reconcile net income to net cash provided by operating activities | ||
Depreciation and amortization | 4,307,717 | 3,157,322 |
Amortization of debt discount and loan fees | 50,880 | 6,954 |
Amortization of gain on sale-leaseback | (39,302) | (39,302) |
Loss on disposal of property and equipment | 66,128 | 148,408 |
Share-based compensation | 97,426 | 55,793 |
Deferred income taxes | (139,850) | (129,358) |
Changes in operating assets and liabilities that provided (used) cash | ||
Accounts receivable | (223,256) | 1,015,328 |
Inventory | (1,957) | (85,783) |
Prepaid assets | 327,902 | 91,219 |
Intangible assets | 57,659 | (68,796) |
Other long-term assets | (41,793) | (55,106) |
Accounts payable | (353,333) | (904,717) |
Accrued liabilities | (1,734,805) | (407,575) |
Deferred rent | 16,617 | 8,591 |
Net cash provided by operating activities | 2,820,438 | 3,055,620 |
Cash flows from investing activities | ||
Proceeds from sale of investments | 0 | 2,917,522 |
Purchases of property and equipment | (7,506,410) | (7,766,440) |
Net cash used in investing activities | (7,506,410) | (4,848,918) |
Cash flows from financing activities | ||
Proceeds from issuance of long-term debt | 3,311,231 | 4,420,322 |
Repayments of long-term debt | (7,500,000) | (2,000,000) |
Proceeds from employee stock purchase plan | 10,707 | 19,222 |
Net cash (used in) provided by financing activities | (4,178,062) | 2,439,544 |
Net (decrease) increase in cash and cash equivalents | (8,864,034) | 646,246 |
Cash and cash equivalents, beginning of period | 14,200,528 | 18,688,281 |
Cash and cash equivalents, end of period | $ 5,336,494 | $ 19,334,527 |
Business and Summary of Signifi
Business and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 27, 2016 | |
Accounting Policies [Abstract] | |
BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Business Diversified Restaurant Holdings, Inc. (“DRH”) is a restaurant company operating two complementary concepts: Buffalo Wild Wings ® Grill & Bar (“BWW”) and Bagger Dave’s Burger Tavern ® (“Bagger Dave’s”). As the largest franchisee of BWW and the creator, developer, and operator of Bagger Dave’s, we provide a unique guest experience in a casual and inviting environment. We were incorporated in 2006 and are headquartered in the Detroit metropolitan area. As of March 27, 2016 , we had 80 locations in Florida, Illinois, Indiana, Michigan, Missouri and Ohio. DRH is the largest BWW franchisee and currently operates 63 DRH-owned BWW restaurants ( 20 in Michigan, 16 in Florida, seven in Illinois, five in Indiana and 15 in Missouri), including the nation’s largest BWW, based on square footage, in downtown Detroit, Michigan. We remain on track to fulfill our area development agreement (“ADA”) with Buffalo Wild Wings International, Inc. (“BWLD”) and expect to operate 77 DRH-owned BWW restaurants by the end of 2020, exclusive of potential additional BWW restaurant acquisitions. DRH originated the Bagger Dave’s concept with our first restaurant opening in January 2008 in Berkley, Michigan. Currently, there are 19 Bagger Dave’s, 16 in Michigan and one in Indiana and two in Ohio. Basis of Presentation The consolidated financial statements as of March 27, 2016 and December 27, 2015 , and for the three-month periods ended March 27, 2016 and March 29, 2015 , have been prepared by DRH and its wholly-owned subsidiaries (collectively, the "Company") pursuant to accounting principles generally accepted in the United States of America (“GAAP”) and the rules and regulations of the SEC. The financial information as of March 27, 2016 and for the three-month periods ended March 27, 2016 and March 29, 2015 is unaudited, but, in the opinion of management, reflects all adjustments and accruals necessary for a fair presentation of the financial position, results of operations, and cash flows for the interim periods. The consolidated financial information as of December 27, 2015 is derived from our audited consolidated financial statements and notes thereto for the fiscal year ended December 27, 2015 , which is included in Item 8 in the Fiscal 2015 Annual Report on Form 10-K, and should be read in conjunction with such consolidated financial statements. The results of operations for the three-month period ended March 27, 2016 are not necessarily indicative of the results of operations that may be achieved for the entire fiscal year ending December 25, 2016 . Segment Reporting During the First Quarter 2016, the Company reorganized segment reporting from one reportable segment to two reportable segments, BWW and Bagger Dave's, due to differences that have developed in the economic characteristics between the two concepts. All prior period information was recast to reflect this change. The Company’s reportable segments are organized based on restaurant concept. Resources are allocated and performance is assessed for the concepts by the Company’s Chief Executive Officer, Chief Financial Officer and Chief Operating Officer whom the Company has determined to be its Chief Operating Decision Makers. See Note 15 for additional information. Goodwill Goodwill is not amortized and represents the excess of cost over the fair value of identified net assets of businesses acquired. Goodwill is subject to an annual impairment analysis or more frequently if indicators of impairment exist. At March 27, 2016 and December 27, 2015 , we had goodwill of $50.1 million , that was assigned to our BWW operating segment. The impairment analysis, if necessary, consists of a two-step process. The first step is to compare the fair value of the reporting unit to its carrying value, including goodwill. We estimate fair value using market information (market approach) and discounted cash flow projections (income approach). The income approach uses the reporting unit’s projection of estimated operating results and cash flows that is discounted using a weighted-average cost of capital that reflects market conditions. The projection uses management’s best estimates of projected revenue, costs and cash expenditures, including an estimate of new restaurant openings and related capital expenditures. Other significant estimates also include terminal growth rates and working capital requirements. We supplement our estimate of fair value under the income approach by using a market approach which estimates fair value by applying multiples to the reporting unit’s projected operating performance. The multiples are derived from comparable publicly traded companies with similar characteristics to the reporting unit. If the fair value of the reporting unit is less than its carrying value, the second step of the impairment analysis must be performed in order to determine the amount of impairment loss, if any. The second step compares the implied fair value of goodwill with the carrying amount of that goodwill. If the carrying amount of the goodwill exceeds its implied fair value, an impairment charge is recognized in an amount equal to that excess. As of December December 27, 2015 , based on our quantitative analysis, goodwill was considered recoverable. At March 27, 2016 , there were no impairment indicators warranting an analysis. Impairment or Disposal of Long-Lived Assets We review long-lived assets quarterly to determine if triggering events have occurred which would require a test to determine if the carrying amount of these assets may not be recoverable based on estimated future cash flows. Assets are reviewed at the lowest level for which cash flows can be identified, which is at the individual restaurant level. In the absence of extraordinary circumstances, restaurants are included in the impairment analysis after they have been open for two years. We evaluate the recoverability of a restaurant’s long-lived assets, including buildings, intangibles, leasehold improvements, furniture, fixtures, and equipment over the remaining life of the primary asset in the asset group, after considering the potential impact of planned operational improvements, marketing programs, and anticipated changes in the trade area. In determining future cash flows, significant estimates are made by management with respect to future operating results for each restaurant over the remaining life of the primary asset in the asset group. If assets are determined to be impaired, the impairment charge is measured by calculating the amount by which the asset carrying amount exceeds its fair value based on our estimate of discounted future cash flows. The determination of asset fair value is also subject to significant judgment. No impairment was recognized for quarter-ended March 27, 2016 . As of December 27, 2015 based on impairment indicators and subsequent analysis the Company recorded a fixed asset impairment of $2.8 million related to four underperforming Bagger Dave's locations. We continue to monitor several other restaurants for potential impairment of long-lived assets while we continue to develop plans to improve operating results. As such, based on our current estimates of the future operating results of these restaurants, we believe that the assets at these restaurants are not impaired. As we periodically refine our estimated future operating results, changes in our estimates and assumptions may cause us to realize impairment charges in the future that could be material. For additional details refer to the 2015 10-K filed on March 11, 2015. We account for exit or disposal activities, including restaurant closures, in accordance with Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 420, Exit or Disposal Cost Obligations . Such costs include the cost of disposing of the assets as well as other facility-related expenses from previously closed restaurants. These costs are generally expensed as incurred. Additionally, at the date we cease using a property under an operating lease, we record a liability for the net present value of any remaining lease obligations, net of estimated sublease income. Any subsequent adjustments to that liability as a result of lease termination or changes in estimates of sublease income are recorded in the period incurred. During fiscal 2015, the Company decided to close 12 underperforming locations, eight in Indiana, three in Michigan and one in Florida. The Company closed the restaurants during the third and fourth quarters of 2015. In connection with the 2015 closures, the Company recorded a liability of $1.3 million , for the net present value of any remaining lease obligations, net of estimated sublease income. As of March 27, 2016 , a liability of $830,361 remains on our Consolidated Balance Sheet and is classified as Other accrued liabilities and Other long-term liabilities. For additional details refer to the 2015 10-K filed on March 11, 2015. Indefinite-Lived Intangible Assets Liquor licenses, also a component of intangible assets, are deemed to have an indefinite life and, accordingly, are not amortized. Management reviews liquor license assets on an annual basis (at year-end) to determine whether carrying values have been impaired. We identify potential impairments for liquor licenses by comparing the fair value with its carrying amount. If the fair value exceeds the carrying amount, the liquor licenses are not impaired. If the carrying amount exceeds the fair value, an impairment loss is recorded for the difference. If the fair value of the asset is less than the carrying amount, an impairment is recorded. No impairments were recognized for quarter-ended March 27, 2016 or fiscal year ended December 27, 2015 . Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates. Interest Rate Swap Agreements The Company utilizes interest rate swap agreements with Citizens Bank, N.A. (“Citizens”) to fix interest rates on a portion of the Company’s portfolio of variable rate debt, which reduces exposure to interest rate fluctuations. The Company does not use any other types of derivative financial instruments to hedge such exposures, nor does it use derivatives for speculative purposes. The Company’s interest rate swap agreements qualify for hedge accounting. As such, the Company records the change in the fair value of its swap agreements as a component of accumulated other comprehensive income (loss), net of tax. The Company records the fair value of its interest swaps on the Consolidated Balance Sheet in other long-term assets or other long-term liabilities depending on the fair value of the swaps. See Note 6 and Note 13 for additional information on the interest rate swap agreements. Recent Accounting Pronouncements In March 2016, the FASB issued Accounting Standards Update ("ASU") 2016-09, Topic 718: Compensation - Stock Compensation: Improvements to Employee Share-Based Payment Accounting ("ASU 2016-09"). ASU 2016-09 simplifies several aspects of accounting for share-based payment award transactions, including income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. ASU 2016-09 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016, with early adoption permitted. The Company is in the process of assessing the impact of adoption of ASU 2016-09 on its consolidated financial statements. In February 2016, FASB issued ASU 2016-02, Leases ("ASU 2016-02"). ASU 2016-02 requires that lease arrangements longer than 12 months result in a lessee recognizing a lease asset and liability. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The updated guidance is effective for interim and annual periods beginning after December 15, 2018, and early adoption is permitted. We are currently evaluating the impact of the updated guidance on our consolidated financial statements. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers ("ASU 2014-09"), which supersedes nearly all existing revenue recognition guidance under GAAP. The core principle of ASU 2014-09 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. ASU 2014-09 defines a five step process to achieve this core principle and, in doing so, more judgment and estimates may be required within the revenue recognition process than are required under existing GAAP. The standard is effective for annual periods beginning after December 15, 2017, and interim periods therein. We are currently evaluating the impact of our pending adoption of ASU 2014-09, although based on the nature of our business we do not expect the standard will have a significant impact on our consolidated financial statements. We reviewed all other significant newly-issued accounting pronouncements and concluded that they either are not applicable to our operations or that no material effect is expected on our consolidated financial statements as a result of future adoption. Recently Adopted Accounting Standards In November 2015, the FASB issued ASU 2015-17, Topic 740: Balance Sheet Classification of Deferred Taxes (“ASU No. 2015-17”), which simplifies the presentation of deferred income taxes. ASU No. 2015-17 provides presentation requirements to classify deferred tax assets and liabilities as noncurrent in a classified statement of financial position. The Company adopted this standard as of December 27, 2015, with prospective application. The adoption of ASU No. 2015-17 had no impact on the Company’s Consolidated Statements of Income and Comprehensive Loss. In April 2015, the FASB issued ASU No. 2015-03, Interest-Imputation of Interest, which updates guidance on the presentation of debt issuance costs. The guidance requires debt issuance costs to be presented as a direct deduction of debt balances on the statement of financial position, similar to the presentation of debt discounts. The guidance is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2015. We retrospectively adopted this guidance in First Quarter 2016. This resulted in a reclassification of the December 27, 2015 Consolidated Balance Sheet of $345,317 from Intangible assets, net to Current portion of long-term debt and Long-term debt, $27,002 and $318,315 , respectively. |
Property and Equipment
Property and Equipment | 3 Months Ended |
Mar. 27, 2016 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | PROPERTY AND EQUIPMENT Property and equipment are comprised of the following assets: March 27, 2016 December 27, 2015 Land $ 37,500 $ 37,500 Building 2,339,219 2,339,219 Equipment 33,759,598 32,912,992 Furniture and fixtures 8,481,222 8,194,060 Leasehold improvements 73,272,456 72,148,545 Restaurant construction in progress 5,410,138 1,768,027 Total 123,300,133 117,400,343 Less accumulated depreciation (40,964,711 ) (38,210,682 ) Property and equipment, net $ 82,335,422 $ 79,189,661 At March 27, 2016 and December 27, 2015, $0.6 million and $0.9 million , respectively, of fixed and intangible assets for the closed locations are held for sale, which is recorded in Property and equipment on the Consolidated Balance Sheets. We anticipate auctioning the remaining assets held for sale in Second Quarter 2016. See Note 1 for additional information. |
Intangible Assets
Intangible Assets | 3 Months Ended |
Mar. 27, 2016 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
INTANGIBLE ASSETS | INTANGIBLE ASSETS Intangible assets are comprised of the following: March 27, 2016 December 27, 2015 Amortized intangibles: Franchise fees $ 1,278,142 $ 1,278,142 Trademark 70,576 66,826 Non-compete agreement 76,560 76,560 Favorable lease 351,344 351,344 Loan fees - Revolving line of credit and DLOC 368,084 368,084 Total 2,144,706 2,140,956 Less accumulated amortization (580,177 ) (519,858 ) Amortized intangibles, net 1,564,529 1,621,098 Unamortized intangibles: Liquor licenses 1,957,317 2,017,618 Total intangibles, net $ 3,521,846 $ 3,638,716 Amortization expense for the three-month periods ended March 27, 2016 and March 29, 2015 was $22,790 and $25,742 , respectively. Amortization of favorable leases and loan fees are reflected as part of occupancy and interest expense, respectively. The aggregate weighted-average amortization period for intangible assets is 10.8 years at March 27, 2016 . |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 27, 2016 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS Fees for monthly accounting and financial statement services are paid to an entity owned by a member of the DRH Board of Directors and a stockholder of the Company. Fees paid during the three-month periods ended March 27, 2016 and March 29, 2015 , were $41,682 , and $138,620 , respectively. |
Other Accrued Liabilities
Other Accrued Liabilities | 3 Months Ended |
Mar. 27, 2016 | |
Payables and Accruals [Abstract] | |
OTHER ACCRUED LIABILITIES | OTHER ACCRUED LIABILITES March 27, 2016 December 27, 2015 Sales tax payable $ 954,111 $ 987,795 Accrued interest 481,549 495,365 Closure liability - current 823,264 1,008,707 Other 1,223,579 1,171,344 Total other accrued liabilities $ 3,482,503 $ 3,663,211 |
Long-Term Debt
Long-Term Debt | 3 Months Ended |
Mar. 27, 2016 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | LONG-TERM DEBT Long-term debt consists of the following obligations: March 27, 2016 December 27, 2015 Note payable - $120.0 million term loan; payable to Citizens with a senior lien on all the Company’s personal property and fixtures. Scheduled monthly principal payments are approximately $833,333 plus accrued interest through maturity in June 2020. Interest is charged based on one-month LIBOR plus an applicable margin, which ranges from 2.25% to 3.5%, depending on the lease adjusted leverage ratio defined in the terms of the agreement. The rate at March 27, 2016 was approximately 3.94%. $ 108,333,333 $ 115,833,333 Note payable - $30.0 million development line of credit; payable to Citizens with a senior lien on all the Company’s personal property and fixtures. Payments are due monthly once fully drawn and matures in June 2020. Interest is charged based on one-month LIBOR plus an applicable margin, which ranges from 2.25% to 3.5%, depending on the lease adjusted leverage ratio defined in the terms of the agreement. The rate at March 27, 2016 was approximately 3.94%. 14,401,554 11,090,323 Unamortized discount and debt issuance costs (633,131 ) (667,666 ) Total debt 122,101,756 126,255,990 Less current portion (9,842,417 ) (9,891,825 ) Long-term debt, net of current portion $ 112,259,339 $ 116,364,165 On June 29, 2015, the Company entered into a $155.0 million senior secured credit facility with Citizens (the “June 2015 Senior Secured Credit Facility”). The June 2015 Senior Secured Credit Facility consists of a $120.0 million term loan (the “June 2015 Term Loan”), a $30.0 million development line of credit (the “June 2015 DLOC”), and a $5.0 million revolving line of credit (the “June 2015 RLOC”). The Company used approximately $65.5 million of the June 2015 Term Loan to refinance existing outstanding debt and used approximately $54.0 million of the June 2015 Term Loan to refinance an acquisition occurring in second quarter 2015. The remaining balance of the June 2015 Term Loan, approximately $0.5 million , was used to pay the fees, costs, and expenses associated with the closing of the June 2015 Senior Secured Credit Facility. The June 2015 Term Loan is for a period of five years . Payments of principal are based upon an 12 -month straight-line amortization schedule, with monthly principal payments of $833,333 plus accrued interest. The interest rate for the June 2015 Term Loan is LIBOR plus an applicable margin, which ranges from 2.25% to 3.5% , depending on the lease adjusted leverage ratio defined in the terms of the agreement. The entire remaining outstanding principal and accrued interest on the June 2015 Term Loan is due and payable on the maturity date of June 29, 2020. The June 2015 DLOC is for a term of two years and is convertible upon maturity into a term note based on the terms of the agreement at which time monthly principal payments will be due based on a 12 -month straight-line amortization schedule, plus interest, through maturity on June 29, 2020. The June 2015 RLOC is for a term of two years and no amounts were outstanding as of March 27, 2016 . Fees related to the term debt are recorded as debt discount and fees related to the DLOC and RLOC are capitalized as intangible assets. Debt issuance costs represents legal, consulting, and financial costs associated with debt financing. Debt discount and debt issuance cost related to term debt totaled $633,131 , net of accumulated amortization at March 27, 2016 . Unamortized debt issuance costs related to the DLOC and RLOC totaled $368,084 at March 27, 2016 . Debt discount and debt issuance cost are amortized over the life of the debt and are recorded in interest expense using the effective interest method. The Company’s evaluation of the June 2015 debt refinancing concluded that the terms of the debt were not substantially modified. For the three-month periods ended March 27, 2016 and March 29, 2015 , interest expense was $1,444,940 and $432,223 , respectively. The current debt agreement contains various customary financial covenants generally based on the performance of the specific borrowing entity and other related entities. The more significant covenants consist of a minimum debt service coverage ratio and a maximum lease adjusted leverage ratio, both of which we are in compliance with as of March 27, 2016 . At March 27, 2016 , the Company has six interest rate swap agreements to fix a portion of the interest rates on its variable rate debt. The swap agreements all qualify for hedge accounting. Under the swap agreements, the Company receives interest at the one -month LIBOR and pays a fixed rate. Since these swap agreements qualify for hedge accounting, the changes in fair value are recorded in other comprehensive income (loss), net of tax. See Note 1 and Note 13 for additional information pertaining to interest rate swaps. The following summarizes the fair values of derivative instruments designated as cash flow hedges which were outstanding: March 27, 2016 Notional amounts Derivative assets Derivative liabilities Interest rate swaps Rate Expires April 2012 1.4% April 2019 $ 7,047,619 $ — $ 82,875 October 2012 0.9% October 2017 3,000,000 — 10,955 July 2013 1.4% April 2018 7,333,333 — 70,855 May 2014 1.5% April 2018 10,892,857 — 163,058 January 2015 1.8% December 2019 20,690,476 — 830,482 August 2015 2.3% June 2020 49,696,875 — 1,956,136 Total $ 98,661,160 $ — $ 3,114,361 December 27, 2015 Notional amounts Derivative assets Derivative liabilities Interest rate swaps Rate Expires April 2012 1.4% April 2019 $ 7,619,048 $ — $ 56,280 October 2012 0.9% October 2017 3,214,286 — 3,027 July 2013 1.4% April 2018 8,190,476 — 60,164 May 2014 1.5% April 2018 11,428,571 — 122,716 January 2015 1.8% December 2019 20,547,619 — 415,459 August 2015 2.3% June 2020 49,696,875 — 867,609 Total $ 100,696,875 $ — $ 1,525,255 |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 27, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK-BASED COMPENSATION | STOCK-BASED COMPENSATION Restricted stock awards In First Quarter 2016 restricted shares were granted to certain team members and board members at a weighted-average fair value of $2.66 per share and in first quarter 2015 no restricted shares were granted. Restricted shares are granted with a per share purchase price at 100.0% of the fair market value on the date of grant. Based on the Stock Award Agreement, shares vest ratably over a 3 year or 1 year period or upon the 3 year anniversary of the granted shares, the vesting terms are determined by the Compensation Committee of the Board of Directors. Unrecognized stock-based compensation expense of $421,967 at March 27, 2016 will be recognized over the remaining weighted-average vesting period of 1.9 years . The total fair value of shares vested during the three-month periods ended March 27, 2016 and March 29, 2015 was $59,631 and $15,436 , respectively. Under the Stock Incentive Plan, there are 393,056 shares available for future awards at March 27, 2016 . The following table presents the restricted shares transactions during the three months ended March 27, 2016 : Number of Restricted Stock Shares Unvested, December 27, 2015 241,124 Granted 3,500 Vested (30,945 ) Expired/Forfeited (10,766 ) Unvested, March 27, 2016 202,913 The following table presents the restricted shares transactions during the three months ended March 29, 2015 : Number of Restricted Stock Shares Unvested, December 28, 2014 164,867 Granted — Vested (3,334 ) Expired/Forfeited (1,917 ) Unvested, March 29, 2015 159,616 On July 30, 2010, DRH granted options for the purchase of 210,000 shares of common stock to the directors of the Company. These options are fully vested and expire six years from issuance, July 30, 2016. Once vested, the options can be exercised at a price of $2.50 per share. On August 13, 2015, 30,000 shares were exercised at a price of $2.50 per share The intrinsic value of options exercised is $6,300 . At March 27, 2016 , 180,000 shares of authorized common stock are reserved for issuance to provide for the exercise of these options. The intrinsic value of outstanding options is $0 and $338,100 as of March 27, 2016 and March 29, 2015 , respectively. Employee stock purchase plan The Company also reserved 250,000 shares of common stock for issuance under the Employee Stock Purchase Plan (“ESPP”). The ESPP is available to team members subject to employment eligibility requirements. Participants may purchase common stock at 85.0% of the lesser of the start or end price for the offering period. The ESPP has four offering periods, each start/end dates coincide with the fiscal quarter and are awarded on the last day of the offering period. During the three-month periods ended March 27, 2016 and March 29, 2015 , we issued 5,609 and 4,662 shares, respectively. Under the ESPP, there are 206,980 shares available for future awards at March 27, 2016 . Share Repurchase Program In March 2015, the Board of Directors authorized a program to repurchase up to $1.0 million of the Company's common stock in open market transactions at market prices or otherwise. In April 2015, we repurchased $98,252 in outstanding shares, representing 24,500 shares. The weighted average purchase price per share was $4.01 . Upon receipt, the repurchased shares were retired and restored to authorized but unissued shares of common stock. Stock-Based Compensation Stock-based compensation of $ 97,426 and $ 55,793 was recognized during the three-month periods ended March 27, 2016 and March 29, 2015 , respectively, as compensation cost in the Consolidated Statements of Income and as additional paid-in capital on the Consolidated Statement of Stockholders' Equity to reflect the fair value of shares vested. The Company has authorized 10,000,000 shares of preferred stock at a par value of $0.0001 . No preferred shares are issued or outstanding as of March 27, 2016 . Any preferences, rights, voting powers, restrictions, dividend limitations, qualifications, and terms and conditions of redemption shall be set forth and adopted by a Board of Directors' resolution prior to issuance of any series of preferred stock. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 27, 2016 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The effective income tax rate for the three months ended March 27, 2016 and March 29, 2015 was (49.9)% and (35.9)% , respectively. The change in the effective income tax rate for March 27, 2016 as compared to the three months ended March 29, 2015 is primarily attributable to the increase in estimated tip tax credits for 2016. The effective income tax rate is negative due to the estimated tip tax credits being larger than the tax expense generated by operating income |
Operating Leases
Operating Leases | 3 Months Ended |
Mar. 27, 2016 | |
Leases, Operating [Abstract] | |
OPERATING LEASES | OPERATING LEASES Base lease terms range from five to 24 years , generally include renewal options, and frequently require us to pay a proportionate share of real estate taxes, insurance, common area maintenance, and other operating costs. Some restaurant leases provide for contingent rental payments based on sales thresholds. Total rent expense was $2.5 million and $1.9 million for the three-month periods ended March 27, 2016 and March 29, 2015 , respectively. Scheduled future minimum lease payments for each of the five years and thereafter for non-cancelable operating leases with initial or remaining lease terms in excess of one year at March 27, 2016 are summarized as follows: Year Amount Remainder of 2016 $ 8,248,554 2017 10,932,225 2018 10,458,132 2019 9,614,494 2020 9,354,108 2021 and thereafter 45,528,165 Total $ 94,135,678 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 27, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES The Company’s ADA requires DRH to open 42 restaurants by April 1, 2021. As of March 27, 2016 we have opened 27 of the 42 restaurants required by the ADA. With the remaining 15 restaurants, we expect the Company will operate 77 BWW restaurants by 2020, exclusive of potential additional BWW restaurant acquisitions. The Company is required to pay BWLD royalties ( 5.0% of net sales) and advertising fund contributions (between 3.15% and 3.25% of net sales globally) for the term of the individual franchise agreements. The Company incurred royalty fees of $2.2 million and $1.6 million for the three-month periods ended March 27, 2016 and March 29, 2015 , respectively. Advertising fund contribution expenses were $1.4 million and $1.0 million for the three-month periods ended March 27, 2016 and March 29, 2015 , respectively. The Company is required by its various BWLD franchise agreements to modernize the restaurants during the term of the agreements. The individual agreements generally require improvements between the fifth and tenth year to meet the most current design model that BWLD has approved. The modernization costs for a restaurant can range from approximately $50,000 to approximately $1.3 million depending on an individual restaurant's needs. On December 18, 2015, a collective action was filed against AMC Wings, Inc., and the Company in the U.S. District Court for the Southern District of Illinois by plaintiffs, David, et. al. A Sure Wing, LLC, the seller of the 18 St. Louis BWW restaurants acquired by the Company on June 29, 2015, was also named as a defendant. Plaintiffs primarily allege that former and current tipped workers at the above-mentioned companies were assigned to perform tasks outside the scope of their tipped positions, in violation of Illinois and federal law. The defendant companies filed their answers to the complaint on February 22, 2016, and during the status hearing on March 18, 2016 the Court ruled on the sequencing of discovery and ordered the parties to draft a proposed joint scheduling order. The Court adopted the parties’ joint scheduling order at the next status hearing on March 24, 2016. On April 11, 2016, plaintiffs filed a motion for conditional certification pursuant to 29 U.S.C. §216(b). Defendant companies’ opposition to that motion is due May 11, 2016. At this stage in the process, plaintiffs have not specified the amount of their damages claim. The Company has filed an indemnity claim against A Sure Wing, LLC and has received a reciprocal indemnity claim from A Sure Wing, LLC. A Sure Wing, LLC and the Company have agreed to toll their respective indemnity claims pending resolution of the matter. This case is in the discovery phase and the plaintiffs have not specified the amount of damages, the Company is unable to reasonably estimate a possible loss or range of loss. Additionally, the Company is subject to ordinary and routine legal proceedings, as well as demands, claims and threatened litigation, which arise in the ordinary course of its business. The ultimate outcome of any litigation is uncertain. While unfavorable outcomes could have adverse effects on the Company's business, results of operations, and financial condition, management believes that the Company is adequately insured and does not believe an unfavorable outcome of any pending or threatened proceedings is probable or reasonably possible. Therefore, no separate reserve or disclosure has been established for these types of legal proceedings. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 27, 2016 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | EARNINGS PER SHARE The following is a reconciliation of basic and fully diluted earnings per common share for the three months ended March 27, 2016 and March 29, 2015 : Three months ended March 27, 2016 March 29, 2015 Income available to common stockholders $ 430,405 $ 262,642 Weighted-average shares outstanding 26,298,034 26,149,184 Effect of dilutive securities — 99,240 Weighted-average shares outstanding - assuming dilution 26,298,034 26,248,424 Earnings per share $ 0.02 $ 0.01 Earnings per share - assuming dilution $ 0.02 $ 0.01 Potentially dilutive securities whose effect would have been antidilutive are excluded from the computation of diluted earnings per share. |
Supplemental Cash Flows Informa
Supplemental Cash Flows Information | 3 Months Ended |
Mar. 27, 2016 | |
Supplemental Cash Flow Elements [Abstract] | |
SUPPLEMENTAL CASH FLOWS INFORMATION | SUPPLEMENTAL CASH FLOWS INFORMATION Other Cash Flows Information Cash paid for interest was $1.4 million and $419,674 during the three-month periods ended March 27, 2016 and March 29, 2015 respectively. Cash paid for income taxes was $0 and $60,000 during the three-month periods ended March 27, 2016 and March 29, 2015 , respectively. Supplemental Schedule of Non-Cash Operating, Investing, and Financing Activities Noncash investing activities for property and equipment not yet paid during the three months ended March 27, 2016 and March 29, 2015 , was $1.8 million and $0.4 million , respectively. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 27, 2016 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | FAIR VALUE OF FINANCIAL INSTRUMENTS The guidance for fair value measurements, FASB ASC 820, Fair Value Measurements and Disclosures , establishes the authoritative definition of fair value, sets out a framework for measuring fair value, and outlines the required disclosures regarding fair value measurements. Fair value is the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. We use a three-tier fair value hierarchy based upon observable and non-observable inputs as follows: ● Level 1 Quoted market prices in active markets for identical assets and liabilities; ● Level 2 Inputs, other than level 1 inputs, either directly or indirectly observable; and ● Level 3 Unobservable inputs developed using internal estimates and assumptions (there is little or no market data) which reflect those that market participants would use. As of March 27, 2016 and December 27, 2015 , respectively, our financial instruments consisted of cash and cash equivalents; including money market funds, accounts receivable, accounts payable, and debt. The fair value of cash and cash equivalents, accounts receivable, and accounts payable approximate carrying value, due to their short-term nature. The fair value of our interest rate swaps is determined based on valuation models, which utilize quoted interest rate curves to calculate the forward value and then discount the forward values to the present period. The Company measures the fair value using broker quotes which are generally based on market observable inputs including yield curves and the value associated with counterparty credit risk. Our interest rate swaps are classified as a Level 2 measurement as these securities are not actively traded in the market, but are observable based on transactions associated with bank loans with similar terms and maturities. See Note 1 and Note 6 for additional information pertaining to interest rates swaps. As of March 27, 2016 and December 27, 2015 , our total debt was approximately $122.1 million and $126.3 million , respectively, which approximated fair value because the applicable interest rates are adjusted frequently based on short-term market rates (Level 2). There were no transfers between levels of the fair value hierarchy during the three months ended March 27, 2016 and the fiscal year ended December 27, 2015 . The following table presents the fair values for those assets and liabilities measured on a recurring basis as of March 27, 2016 : FAIR VALUE MEASUREMENTS Description Level 1 Level 2 Level 3 Asset/(Liability) Total Interest rate swaps $ — $ (3,114,361 ) $ — $ (3,114,361 ) The following table presents the fair values for those assets and liabilities measured on a recurring basis as of December 27, 2015 : FAIR VALUE MEASUREMENTS Description Level 1 Level 2 Level 3 Asset/(Liability) Total Cash equivalents $ 2,000,000 $ — $ — $ 2,000,000 Interest rate swaps — (1,525,255 ) — (1,525,255 ) Total $ 2,000,000 $ (1,525,255 ) $ — $ 474,745 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 3 Months Ended |
Mar. 27, 2016 | |
Stockholders' Equity Note [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The following table summarizes each component of Accumulated Other Comprehensive Income (loss): Three Months Ended March 27, 2016 Interest Rate Swap Investments Total Beginning balance $ (1,006,667 ) $ — $ (1,006,667 ) Loss recorded to other comprehensive income (1,589,106 ) — (1,589,106 ) Tax benefit 540,296 — 540,296 Other comprehensive loss (1,048,810 ) — (1,048,810 ) Accumulated OCL $ (2,055,477 ) $ — $ (2,055,477 ) Three Months Ended March 29, 2015 Interest Rate Swap Investments Total Beginning balance $ (171,352 ) $ (3,804 ) $ (175,156 ) Gain (loss) recorded to other comprehensive income (475,564 ) 5,763 (469,801 ) Tax income (expense) 161,691 (1,959 ) 159,732 Other comprehensive income (loss) (313,873 ) 3,804 (310,069 ) Accumulated OCL $ (485,225 ) $ — $ (485,225 ) |
Segment Reporting
Segment Reporting | 3 Months Ended |
Mar. 27, 2016 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | SEGMENT REPORTING During the First Quarter 2016, the Company reorganized segment reporting from one reportable segment to two reportable segments, BWW and Bagger Dave's, due to differences that have developed in the economic characteristics between the two concepts. All prior period information was recast to reflect this change. The Company’s reportable segments are organized based on restaurant concept. Resources are allocated and performance is assessed for the concepts by the Company’s Chief Executive Officer, Chief Financial Officer and Chief Operating Officer whom the Company has determined to be its Chief Operating Decision Makers. See Note 1 for additional information. Revenues for all segments include only transactions with customers and include no intersegment revenues. Excluded from net income from operations for BWW and Bagger Dave's are certain legal and corporate costs not directly related to the performance of the segments, interest and other expenses related to the Company’s credit agreements and derivative instruments, certain stock-based compensation expenses, certain bonus expense and certain insurance expenses managed centrally. Segment activity is as follows: Three months ended March 27, 2016 March 29, 2015 Revenue from external customers: BWW $ 43,143,252 $ 31,852,089 Bagger Dave's 5,269,547 7,588,243 Total $ 48,412,799 $ 39,440,332 Segment operating profit (loss): BWW $ 5,285,645 $ 4,606,331 Bagger Dave's (612,260 ) (1,458,634 ) Total segment operating profit $ 4,673,385 $ 3,147,697 Closure-related expenses (345,011 ) — Corporate expenses (2,641,625 ) (2,539,193 ) Total consolidated operating profit $ 1,686,749 $ 608,504 Interest expense $ (1,444,940 ) $ (432,223 ) Other income 45,272 17,003 Net income before income taxes $ 287,081 $ 193,284 March 27, 2016 December 27, 2015 Total assets BWW $ 117,530,474 $ 115,044,166 Bagger Dave's 22,262,803 21,886,470 Corporate 20,763,325 28,841,859 Total assets $ 160,556,602 $ 165,772,495 |
Business and Summary of Signi24
Business and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 27, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The consolidated financial statements as of March 27, 2016 and December 27, 2015 , and for the three-month periods ended March 27, 2016 and March 29, 2015 , have been prepared by DRH and its wholly-owned subsidiaries (collectively, the "Company") pursuant to accounting principles generally accepted in the United States of America (“GAAP”) and the rules and regulations of the SEC. The financial information as of March 27, 2016 and for the three-month periods ended March 27, 2016 and March 29, 2015 is unaudited, but, in the opinion of management, reflects all adjustments and accruals necessary for a fair presentation of the financial position, results of operations, and cash flows for the interim periods. The consolidated financial information as of December 27, 2015 is derived from our audited consolidated financial statements and notes thereto for the fiscal year ended December 27, 2015 , which is included in Item 8 in the Fiscal 2015 Annual Report on Form 10-K, and should be read in conjunction with such consolidated financial statements. The results of operations for the three-month period ended March 27, 2016 are not necessarily indicative of the results of operations that may be achieved for the entire fiscal year ending December 25, 2016 . |
Segment Reporting | Segment Reporting During the First Quarter 2016, the Company reorganized segment reporting from one reportable segment to two reportable segments, BWW and Bagger Dave's, due to differences that have developed in the economic characteristics between the two concepts. All prior period information was recast to reflect this change. The Company’s reportable segments are organized based on restaurant concept. Resources are allocated and performance is assessed for the concepts by the Company’s Chief Executive Officer, Chief Financial Officer and Chief Operating Officer whom the Company has determined to be its Chief Operating Decision Makers. See Note 15 for additional information. |
Goodwill | Goodwill Goodwill is not amortized and represents the excess of cost over the fair value of identified net assets of businesses acquired. Goodwill is subject to an annual impairment analysis or more frequently if indicators of impairment exist. At March 27, 2016 and December 27, 2015 , we had goodwill of $50.1 million , that was assigned to our BWW operating segment. The impairment analysis, if necessary, consists of a two-step process. The first step is to compare the fair value of the reporting unit to its carrying value, including goodwill. We estimate fair value using market information (market approach) and discounted cash flow projections (income approach). The income approach uses the reporting unit’s projection of estimated operating results and cash flows that is discounted using a weighted-average cost of capital that reflects market conditions. The projection uses management’s best estimates of projected revenue, costs and cash expenditures, including an estimate of new restaurant openings and related capital expenditures. Other significant estimates also include terminal growth rates and working capital requirements. We supplement our estimate of fair value under the income approach by using a market approach which estimates fair value by applying multiples to the reporting unit’s projected operating performance. The multiples are derived from comparable publicly traded companies with similar characteristics to the reporting unit. If the fair value of the reporting unit is less than its carrying value, the second step of the impairment analysis must be performed in order to determine the amount of impairment loss, if any. The second step compares the implied fair value of goodwill with the carrying amount of that goodwill. If the carrying amount of the goodwill exceeds its implied fair value, an impairment charge is recognized in an amount equal to that excess. As of December December 27, 2015 , based on our quantitative analysis, goodwill was considered recoverable. At March 27, 2016 , there were no impairment indicators warranting an analysis. |
Impairment of Long-Lived Assets and Indefinite-Lived Intangible Assets | Impairment or Disposal of Long-Lived Assets We review long-lived assets quarterly to determine if triggering events have occurred which would require a test to determine if the carrying amount of these assets may not be recoverable based on estimated future cash flows. Assets are reviewed at the lowest level for which cash flows can be identified, which is at the individual restaurant level. In the absence of extraordinary circumstances, restaurants are included in the impairment analysis after they have been open for two years. We evaluate the recoverability of a restaurant’s long-lived assets, including buildings, intangibles, leasehold improvements, furniture, fixtures, and equipment over the remaining life of the primary asset in the asset group, after considering the potential impact of planned operational improvements, marketing programs, and anticipated changes in the trade area. In determining future cash flows, significant estimates are made by management with respect to future operating results for each restaurant over the remaining life of the primary asset in the asset group. If assets are determined to be impaired, the impairment charge is measured by calculating the amount by which the asset carrying amount exceeds its fair value based on our estimate of discounted future cash flows. The determination of asset fair value is also subject to significant judgment. No impairment was recognized for quarter-ended March 27, 2016 . As of December 27, 2015 based on impairment indicators and subsequent analysis the Company recorded a fixed asset impairment of $2.8 million related to four underperforming Bagger Dave's locations. We continue to monitor several other restaurants for potential impairment of long-lived assets while we continue to develop plans to improve operating results. As such, based on our current estimates of the future operating results of these restaurants, we believe that the assets at these restaurants are not impaired. As we periodically refine our estimated future operating results, changes in our estimates and assumptions may cause us to realize impairment charges in the future that could be material. For additional details refer to the 2015 10-K filed on March 11, 2015. We account for exit or disposal activities, including restaurant closures, in accordance with Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 420, Exit or Disposal Cost Obligations . Such costs include the cost of disposing of the assets as well as other facility-related expenses from previously closed restaurants. These costs are generally expensed as incurred. Additionally, at the date we cease using a property under an operating lease, we record a liability for the net present value of any remaining lease obligations, net of estimated sublease income. Any subsequent adjustments to that liability as a result of lease termination or changes in estimates of sublease income are recorded in the period incurred. During fiscal 2015, the Company decided to close 12 underperforming locations, eight in Indiana, three in Michigan and one in Florida. The Company closed the restaurants during the third and fourth quarters of 2015. In connection with the 2015 closures, the Company recorded a liability of $1.3 million , for the net present value of any remaining lease obligations, net of estimated sublease income. As of March 27, 2016 , a liability of $830,361 remains on our Consolidated Balance Sheet and is classified as Other accrued liabilities and Other long-term liabilities. For additional details refer to the 2015 10-K filed on March 11, 2015. Indefinite-Lived Intangible Assets Liquor licenses, also a component of intangible assets, are deemed to have an indefinite life and, accordingly, are not amortized. Management reviews liquor license assets on an annual basis (at year-end) to determine whether carrying values have been impaired. We identify potential impairments for liquor licenses by comparing the fair value with its carrying amount. If the fair value exceeds the carrying amount, the liquor licenses are not impaired. If the carrying amount exceeds the fair value, an impairment loss is recorded for the difference. If the fair value of the asset is less than the carrying amount, an impairment is recorded. No impairments were recognized for quarter-ended March 27, 2016 or fiscal year ended December 27, 2015 . |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates. |
Interest Rate Swap Agreements | Interest Rate Swap Agreements The Company utilizes interest rate swap agreements with Citizens Bank, N.A. (“Citizens”) to fix interest rates on a portion of the Company’s portfolio of variable rate debt, which reduces exposure to interest rate fluctuations. The Company does not use any other types of derivative financial instruments to hedge such exposures, nor does it use derivatives for speculative purposes. The Company’s interest rate swap agreements qualify for hedge accounting. As such, the Company records the change in the fair value of its swap agreements as a component of accumulated other comprehensive income (loss), net of tax. The Company records the fair value of its interest swaps on the Consolidated Balance Sheet in other long-term assets or other long-term liabilities depending on the fair value of the swaps. See Note 6 and Note 13 for additional information on the interest rate swap agreements. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In March 2016, the FASB issued Accounting Standards Update ("ASU") 2016-09, Topic 718: Compensation - Stock Compensation: Improvements to Employee Share-Based Payment Accounting ("ASU 2016-09"). ASU 2016-09 simplifies several aspects of accounting for share-based payment award transactions, including income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. ASU 2016-09 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016, with early adoption permitted. The Company is in the process of assessing the impact of adoption of ASU 2016-09 on its consolidated financial statements. In February 2016, FASB issued ASU 2016-02, Leases ("ASU 2016-02"). ASU 2016-02 requires that lease arrangements longer than 12 months result in a lessee recognizing a lease asset and liability. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The updated guidance is effective for interim and annual periods beginning after December 15, 2018, and early adoption is permitted. We are currently evaluating the impact of the updated guidance on our consolidated financial statements. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers ("ASU 2014-09"), which supersedes nearly all existing revenue recognition guidance under GAAP. The core principle of ASU 2014-09 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. ASU 2014-09 defines a five step process to achieve this core principle and, in doing so, more judgment and estimates may be required within the revenue recognition process than are required under existing GAAP. The standard is effective for annual periods beginning after December 15, 2017, and interim periods therein. We are currently evaluating the impact of our pending adoption of ASU 2014-09, although based on the nature of our business we do not expect the standard will have a significant impact on our consolidated financial statements. We reviewed all other significant newly-issued accounting pronouncements and concluded that they either are not applicable to our operations or that no material effect is expected on our consolidated financial statements as a result of future adoption. Recently Adopted Accounting Standards In November 2015, the FASB issued ASU 2015-17, Topic 740: Balance Sheet Classification of Deferred Taxes (“ASU No. 2015-17”), which simplifies the presentation of deferred income taxes. ASU No. 2015-17 provides presentation requirements to classify deferred tax assets and liabilities as noncurrent in a classified statement of financial position. The Company adopted this standard as of December 27, 2015, with prospective application. The adoption of ASU No. 2015-17 had no impact on the Company’s Consolidated Statements of Income and Comprehensive Loss. In April 2015, the FASB issued ASU No. 2015-03, Interest-Imputation of Interest, which updates guidance on the presentation of debt issuance costs. The guidance requires debt issuance costs to be presented as a direct deduction of debt balances on the statement of financial position, similar to the presentation of debt discounts. The guidance is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2015. We retrospectively adopted this guidance in First Quarter 2016. This resulted in a reclassification of the December 27, 2015 Consolidated Balance Sheet of $345,317 from Intangible assets, net to Current portion of long-term debt and Long-term debt, $27,002 and $318,315 , respectively. |
Property and Equipment (Tables)
Property and Equipment (Tables) | 3 Months Ended |
Mar. 27, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property and equipment are comprised of the following assets: March 27, 2016 December 27, 2015 Land $ 37,500 $ 37,500 Building 2,339,219 2,339,219 Equipment 33,759,598 32,912,992 Furniture and fixtures 8,481,222 8,194,060 Leasehold improvements 73,272,456 72,148,545 Restaurant construction in progress 5,410,138 1,768,027 Total 123,300,133 117,400,343 Less accumulated depreciation (40,964,711 ) (38,210,682 ) Property and equipment, net $ 82,335,422 $ 79,189,661 At March 27, 2016 and December 27, 2015, $0.6 million and $0.9 million , respectively, of fixed and intangible assets for the closed locations are held for sale, which is recorded in Property and equipment on the Consolidated Balance Sheets. We anticipate auctioning the remaining assets held for sale in Second Quarter 2016. See Note 1 for additional information. |
Intangible Assets (Tables)
Intangible Assets (Tables) | 3 Months Ended |
Mar. 27, 2016 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Schedule of Finite-Lived Intangible Assets | Intangible assets are comprised of the following: March 27, 2016 December 27, 2015 Amortized intangibles: Franchise fees $ 1,278,142 $ 1,278,142 Trademark 70,576 66,826 Non-compete agreement 76,560 76,560 Favorable lease 351,344 351,344 Loan fees - Revolving line of credit and DLOC 368,084 368,084 Total 2,144,706 2,140,956 Less accumulated amortization (580,177 ) (519,858 ) Amortized intangibles, net 1,564,529 1,621,098 Unamortized intangibles: Liquor licenses 1,957,317 2,017,618 Total intangibles, net $ 3,521,846 $ 3,638,716 |
Other Accrued Liabilities (Tabl
Other Accrued Liabilities (Tables) | 3 Months Ended |
Mar. 27, 2016 | |
Payables and Accruals [Abstract] | |
Other Accrued Liabilities | OTHER ACCRUED LIABILITES March 27, 2016 December 27, 2015 Sales tax payable $ 954,111 $ 987,795 Accrued interest 481,549 495,365 Closure liability - current 823,264 1,008,707 Other 1,223,579 1,171,344 Total other accrued liabilities $ 3,482,503 $ 3,663,211 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 3 Months Ended |
Mar. 27, 2016 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt | March 27, 2016 December 27, 2015 Note payable - $120.0 million term loan; payable to Citizens with a senior lien on all the Company’s personal property and fixtures. Scheduled monthly principal payments are approximately $833,333 plus accrued interest through maturity in June 2020. Interest is charged based on one-month LIBOR plus an applicable margin, which ranges from 2.25% to 3.5%, depending on the lease adjusted leverage ratio defined in the terms of the agreement. The rate at March 27, 2016 was approximately 3.94%. $ 108,333,333 $ 115,833,333 Note payable - $30.0 million development line of credit; payable to Citizens with a senior lien on all the Company’s personal property and fixtures. Payments are due monthly once fully drawn and matures in June 2020. Interest is charged based on one-month LIBOR plus an applicable margin, which ranges from 2.25% to 3.5%, depending on the lease adjusted leverage ratio defined in the terms of the agreement. The rate at March 27, 2016 was approximately 3.94%. 14,401,554 11,090,323 Unamortized discount and debt issuance costs (633,131 ) (667,666 ) Total debt 122,101,756 126,255,990 Less current portion (9,842,417 ) (9,891,825 ) Long-term debt, net of current portion $ 112,259,339 $ 116,364,165 |
Fair Values of Derivative Instruments | The following summarizes the fair values of derivative instruments designated as cash flow hedges which were outstanding: March 27, 2016 Notional amounts Derivative assets Derivative liabilities Interest rate swaps Rate Expires April 2012 1.4% April 2019 $ 7,047,619 $ — $ 82,875 October 2012 0.9% October 2017 3,000,000 — 10,955 July 2013 1.4% April 2018 7,333,333 — 70,855 May 2014 1.5% April 2018 10,892,857 — 163,058 January 2015 1.8% December 2019 20,690,476 — 830,482 August 2015 2.3% June 2020 49,696,875 — 1,956,136 Total $ 98,661,160 $ — $ 3,114,361 December 27, 2015 Notional amounts Derivative assets Derivative liabilities Interest rate swaps Rate Expires April 2012 1.4% April 2019 $ 7,619,048 $ — $ 56,280 October 2012 0.9% October 2017 3,214,286 — 3,027 July 2013 1.4% April 2018 8,190,476 — 60,164 May 2014 1.5% April 2018 11,428,571 — 122,716 January 2015 1.8% December 2019 20,547,619 — 415,459 August 2015 2.3% June 2020 49,696,875 — 867,609 Total $ 100,696,875 $ — $ 1,525,255 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 27, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Nonvested Restricted Stock Shares Activity | The following table presents the restricted shares transactions during the three months ended March 27, 2016 : Number of Restricted Stock Shares Unvested, December 27, 2015 241,124 Granted 3,500 Vested (30,945 ) Expired/Forfeited (10,766 ) Unvested, March 27, 2016 202,913 The following table presents the restricted shares transactions during the three months ended March 29, 2015 : Number of Restricted Stock Shares Unvested, December 28, 2014 164,867 Granted — Vested (3,334 ) Expired/Forfeited (1,917 ) Unvested, March 29, 2015 159,616 |
Operating Leases (Tables)
Operating Leases (Tables) | 3 Months Ended |
Mar. 27, 2016 | |
Leases, Operating [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases | Scheduled future minimum lease payments for each of the five years and thereafter for non-cancelable operating leases with initial or remaining lease terms in excess of one year at March 27, 2016 are summarized as follows: Year Amount Remainder of 2016 $ 8,248,554 2017 10,932,225 2018 10,458,132 2019 9,614,494 2020 9,354,108 2021 and thereafter 45,528,165 Total $ 94,135,678 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 27, 2016 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following is a reconciliation of basic and fully diluted earnings per common share for the three months ended March 27, 2016 and March 29, 2015 : Three months ended March 27, 2016 March 29, 2015 Income available to common stockholders $ 430,405 $ 262,642 Weighted-average shares outstanding 26,298,034 26,149,184 Effect of dilutive securities — 99,240 Weighted-average shares outstanding - assuming dilution 26,298,034 26,248,424 Earnings per share $ 0.02 $ 0.01 Earnings per share - assuming dilution $ 0.02 $ 0.01 Potentially dilutive securities whose effect would have been antidilutive are excluded from the computation of diluted earnings per share. |
Fair Value of Financial Instr32
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Mar. 27, 2016 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following table presents the fair values for those assets and liabilities measured on a recurring basis as of March 27, 2016 : FAIR VALUE MEASUREMENTS Description Level 1 Level 2 Level 3 Asset/(Liability) Total Interest rate swaps $ — $ (3,114,361 ) $ — $ (3,114,361 ) The following table presents the fair values for those assets and liabilities measured on a recurring basis as of December 27, 2015 : FAIR VALUE MEASUREMENTS Description Level 1 Level 2 Level 3 Asset/(Liability) Total Cash equivalents $ 2,000,000 $ — $ — $ 2,000,000 Interest rate swaps — (1,525,255 ) — (1,525,255 ) Total $ 2,000,000 $ (1,525,255 ) $ — $ 474,745 |
Accumulated Other Comprehensi33
Accumulated Other Comprehensive Income (Loss) (Tables) | 3 Months Ended |
Mar. 27, 2016 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | The following table summarizes each component of Accumulated Other Comprehensive Income (loss): Three Months Ended March 27, 2016 Interest Rate Swap Investments Total Beginning balance $ (1,006,667 ) $ — $ (1,006,667 ) Loss recorded to other comprehensive income (1,589,106 ) — (1,589,106 ) Tax benefit 540,296 — 540,296 Other comprehensive loss (1,048,810 ) — (1,048,810 ) Accumulated OCL $ (2,055,477 ) $ — $ (2,055,477 ) Three Months Ended March 29, 2015 Interest Rate Swap Investments Total Beginning balance $ (171,352 ) $ (3,804 ) $ (175,156 ) Gain (loss) recorded to other comprehensive income (475,564 ) 5,763 (469,801 ) Tax income (expense) 161,691 (1,959 ) 159,732 Other comprehensive income (loss) (313,873 ) 3,804 (310,069 ) Accumulated OCL $ (485,225 ) $ — $ (485,225 ) |
Segment Reporting (Tables)
Segment Reporting (Tables) | 3 Months Ended |
Mar. 27, 2016 | |
Segment Reporting [Abstract] | |
Schedule of segment activity | Segment activity is as follows: Three months ended March 27, 2016 March 29, 2015 Revenue from external customers: BWW $ 43,143,252 $ 31,852,089 Bagger Dave's 5,269,547 7,588,243 Total $ 48,412,799 $ 39,440,332 Segment operating profit (loss): BWW $ 5,285,645 $ 4,606,331 Bagger Dave's (612,260 ) (1,458,634 ) Total segment operating profit $ 4,673,385 $ 3,147,697 Closure-related expenses (345,011 ) — Corporate expenses (2,641,625 ) (2,539,193 ) Total consolidated operating profit $ 1,686,749 $ 608,504 Interest expense $ (1,444,940 ) $ (432,223 ) Other income 45,272 17,003 Net income before income taxes $ 287,081 $ 193,284 March 27, 2016 December 27, 2015 Total assets BWW $ 117,530,474 $ 115,044,166 Bagger Dave's 22,262,803 21,886,470 Corporate 20,763,325 28,841,859 Total assets $ 160,556,602 $ 165,772,495 |
Business and Summary of Signi35
Business and Summary of Significant Accounting Policies (Details) | 3 Months Ended | 12 Months Ended | |||
Mar. 27, 2016USD ($)restaurantsegment | Dec. 27, 2015USD ($)restaurant | Mar. 29, 2015USD ($) | Dec. 27, 2015USD ($)restaurant | Dec. 31, 2020restaurant | |
Segment Reporting Information [Line Items] | |||||
Number of restaurants | 80 | ||||
Number of reportable segments | segment | 2 | ||||
Goodwill | $ | $ 50,097,081 | $ 50,097,081 | $ 50,097,081 | ||
Asset impairment loss | $ | 0 | $ 0 | |||
Restructuring Reserve | $ | $ 830,361 | 1,300,000 | 1,300,000 | ||
Bagger Dave's | |||||
Segment Reporting Information [Line Items] | |||||
Number of restaurants | 19 | ||||
Bagger Dave's | Michigan | |||||
Segment Reporting Information [Line Items] | |||||
Number of restaurants | 16 | ||||
Bagger Dave's | Indiana | |||||
Segment Reporting Information [Line Items] | |||||
Number of restaurants | 1 | ||||
Bagger Dave's | Ohio | |||||
Segment Reporting Information [Line Items] | |||||
Number of restaurants | 2 | ||||
BWW | |||||
Segment Reporting Information [Line Items] | |||||
Number of restaurants | 63 | ||||
Goodwill | $ | $ 50,097,081 | 50,100,000 | $ 50,100,000 | ||
BWW | Michigan | |||||
Segment Reporting Information [Line Items] | |||||
Number of restaurants | 20 | ||||
BWW | Indiana | |||||
Segment Reporting Information [Line Items] | |||||
Number of restaurants | 5 | ||||
BWW | Missouri | |||||
Segment Reporting Information [Line Items] | |||||
Number of restaurants | 15 | ||||
BWW | Florida | |||||
Segment Reporting Information [Line Items] | |||||
Number of restaurants | 16 | ||||
BWW | Illinois | |||||
Segment Reporting Information [Line Items] | |||||
Number of restaurants | 7 | ||||
Facility Closing | |||||
Segment Reporting Information [Line Items] | |||||
Number of Restaurants Closed | 12 | ||||
Facility Closing | Michigan | |||||
Segment Reporting Information [Line Items] | |||||
Number of Restaurants Closed | 3 | ||||
Facility Closing | Indiana | |||||
Segment Reporting Information [Line Items] | |||||
Number of Restaurants Closed | 8 | ||||
Facility Closing | Florida | |||||
Segment Reporting Information [Line Items] | |||||
Number of Restaurants Closed | 1 | ||||
Bagger Dave's | |||||
Segment Reporting Information [Line Items] | |||||
Asset impairment loss | $ | $ 0 | $ 2,800,000 | |||
Number of Restaurants Impaired | 4 | ||||
Exclusive of Potential Additional Restaurant Acquisitions | Scenario, Forecast | |||||
Segment Reporting Information [Line Items] | |||||
Number of restaurants | 77 | ||||
ASU 2015-03 | Intangible Assets, Net | |||||
Segment Reporting Information [Line Items] | |||||
Debt issuance costs | $ | $ (345,317) | $ (345,317) | |||
ASU 2015-03 | Long-term Debt, Current Maturities | |||||
Segment Reporting Information [Line Items] | |||||
Debt issuance costs | $ | 27,002 | 27,002 | |||
ASU 2015-03 | Long-term Debt | |||||
Segment Reporting Information [Line Items] | |||||
Debt issuance costs | $ | $ 318,315 | $ 318,315 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | Mar. 27, 2016 | Dec. 27, 2015 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 123,300,133 | $ 117,400,343 |
Less accumulated depreciation | (40,964,711) | (38,210,682) |
Property and equipment, net | 82,335,422 | 79,189,661 |
fixed and intangible assets held for sale | 600,000 | 900,000 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 37,500 | 37,500 |
Building | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 2,339,219 | 2,339,219 |
Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 33,759,598 | 32,912,992 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 8,481,222 | 8,194,060 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 73,272,456 | 72,148,545 |
Restaurant construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 5,410,138 | $ 1,768,027 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) | 3 Months Ended | ||
Mar. 27, 2016 | Mar. 29, 2015 | Dec. 27, 2015 | |
Amortized intangibles: | |||
Franchise fees | $ 1,278,142 | $ 1,278,142 | |
Trademark | 70,576 | 66,826 | |
Non-compete agreement | 76,560 | 76,560 | |
Favorable lease | 351,344 | 351,344 | |
Loan fees - Revolving line of credit and DLOC | 368,084 | 368,084 | |
Total | 2,144,706 | 2,140,956 | |
Less accumulated amortization | (580,177) | (519,858) | |
Amortized intangibles, net | 1,564,529 | 1,621,098 | |
Unamortized intangibles: | |||
Liquor licenses | 1,957,317 | 2,017,618 | |
Total intangibles, net | 3,521,846 | $ 3,638,716 | |
Amortization expense | $ 22,790 | $ 25,742 | |
Aggregate weighted-average amortization period | 10 years 292 days |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | 3 Months Ended | |
Mar. 27, 2016 | Mar. 29, 2015 | |
Related Party Transactions [Abstract] | ||
Professional fees | $ 41,682 | $ 138,620 |
Other Accrued Liabilities (Deta
Other Accrued Liabilities (Details) - USD ($) | Mar. 27, 2016 | Dec. 27, 2015 |
Payables and Accruals [Abstract] | ||
Sales tax payable | $ 954,111 | $ 987,795 |
Accrued interest | 481,549 | 495,365 |
Closure liability - current | 823,264 | 1,008,707 |
Other | 1,223,579 | 1,171,344 |
Accrued Liabilities, Current | $ 3,482,503 | $ 3,663,211 |
Long-Term Debt (Details)
Long-Term Debt (Details) - USD ($) | Mar. 27, 2016 | Dec. 27, 2015 |
Debt Instrument [Line Items] | ||
Unamortized discount and debt issuance costs | $ (633,131) | $ (667,666) |
Total | 122,101,756 | 126,255,990 |
Less current portion | (9,842,417) | (9,891,825) |
Long-term debt, net of current portion | 112,259,339 | 116,364,165 |
Term Loan | June 2020 Term Loan | ||
Debt Instrument [Line Items] | ||
Notes payable | 108,333,333 | 115,833,333 |
Line of Credit | June 2020 DLOC | ||
Debt Instrument [Line Items] | ||
Notes payable | $ 14,401,554 | $ 11,090,323 |
Long-Term Debt (Additional Info
Long-Term Debt (Additional Information) (Details) - USD ($) | Jun. 29, 2015 | Mar. 27, 2016 | Dec. 27, 2015 |
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 155,000,000 | ||
Term Loan | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | 120,000,000 | ||
Scheduled monthly principal and interest paymеnts (in Dollars) | $ 833,333 | ||
Interest rate range, low | 2.25% | ||
Interest rate range, high | 3.50% | ||
Term Loan | June 2020 Term Loan | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 120,000,000 | $ 120,000,000 | |
Scheduled monthly principal and interest paymеnts (in Dollars) | $ 833,333 | $ 833,333 | |
Interest rate range, low | 2.25% | 2.25% | |
Interest rate range, high | 3.50% | 3.50% | |
Intеrеst ratе at еnd of pеriod | 3.94% | ||
Line of Credit | June 2020 Term Loan | |||
Debt Instrument [Line Items] | |||
Intеrеst ratе at еnd of pеriod | 3.94% | ||
Line of Credit | June 2020 DLOC | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 30,000,000 | $ 30,000,000 | |
Interest rate range, low | 2.25% | 2.25% | |
Interest rate range, high | 3.50% | 3.50% |
Long-Term Debt (Narrative) (Det
Long-Term Debt (Narrative) (Details) | Jun. 29, 2015USD ($) | Mar. 27, 2016USD ($)agreement | Mar. 29, 2015USD ($) | Dec. 27, 2015USD ($) |
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | $ 155,000,000 | |||
Interest expense | $ 1,444,940 | $ 432,223 | ||
Unamortized discount and debt issuance costs | 633,131 | $ 667,666 | ||
Unamortized debt issuance costs | $ 368,084 | |||
Interest Rate Swap | ||||
Debt Instrument [Line Items] | ||||
Number of interest rate swap agreements | agreement | 6 | |||
Term Loan | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | 120,000,000 | |||
Payments used to refinance existing outstanding debt | 65,500,000 | |||
Payments used to refinance and term out the outstanding balance of existing development line of credit loan | 54,000,000 | |||
Payments of fees and closing costs | $ 500,000 | |||
Debt term | 5 years | |||
Debt payment term | 12 months | |||
Scheduled monthly principal and interest paymеnts (in Dollars) | $ 833,333 | |||
Interest rate range, low | 2.25% | |||
Interest rate range, high | 3.50% | |||
Line of Credit | Development Line of Credit | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | $ 30,000,000 | |||
Debt term | 2 years | |||
Line of Credit | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Debt term | 2 years | |||
Outstanding revolving line of credit | $ 0 | |||
Senior Secured Credit Facility | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | $ 5,000,000 |
Long-Term Debt (Fair Value of d
Long-Term Debt (Fair Value of derivative Instruments) (Details) - Cash Flow Hedging - USD ($) | Mar. 27, 2016 | Dec. 27, 2015 |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Notional amounts | $ 98,661,160 | $ 100,696,875 |
Derivative assets | 0 | 0 |
Derivative liabilities | $ 3,114,361 | $ 1,525,255 |
April 2,012 | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Rate | 1.40% | 1.40% |
Notional amounts | $ 7,047,619 | $ 7,619,048 |
Derivative assets | 0 | 0 |
Derivative liabilities | $ 82,875 | $ 56,280 |
October 2,012 | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Rate | 0.90% | 0.90% |
Notional amounts | $ 3,000,000 | $ 3,214,286 |
Derivative assets | 0 | 0 |
Derivative liabilities | $ 10,955 | $ 3,027 |
July 2,013 | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Rate | 1.40% | 1.40% |
Notional amounts | $ 7,333,333 | $ 8,190,476 |
Derivative assets | 0 | 0 |
Derivative liabilities | $ 70,855 | $ 60,164 |
May 2,014 | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Rate | 1.50% | 1.50% |
Notional amounts | $ 10,892,857 | $ 11,428,571 |
Derivative assets | 0 | 0 |
Derivative liabilities | $ 163,058 | $ 122,716 |
January 2,015 | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Rate | 1.80% | 1.80% |
Notional amounts | $ 20,690,476 | $ 20,547,619 |
Derivative assets | 0 | 0 |
Derivative liabilities | $ 830,482 | $ 415,459 |
August 2,015 | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Rate | 2.30% | 2.30% |
Notional amounts | $ 49,696,875 | $ 49,696,875 |
Derivative assets | 0 | |
Derivative liabilities | $ 1,956,136 |
Stock-Based Compensation (Narra
Stock-Based Compensation (Narrative) (Details) | Jul. 30, 2010$ / sharesshares | Aug. 31, 2015USD ($)$ / sharesshares | Apr. 30, 2015USD ($)$ / sharesshares | Mar. 27, 2016USD ($)offering_period$ / sharesshares | Mar. 29, 2015USD ($)shares | Dec. 27, 2015shares | Mar. 31, 2015USD ($) |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock repurchase authorized amount | $ | $ 1,000,000 | ||||||
Amount of stock repurchased during period | $ | $ 98,252 | ||||||
Number of shares repurchased during period | 24,500 | ||||||
Weighted average purchase price per share | $ / shares | $ 4.01 | ||||||
Share-based compensation | $ | $ 97,426 | $ 55,793 | |||||
Preferred stock, shares authorized | 10,000,000 | ||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.0001 | ||||||
Preferred stock, shares issued | 0 | ||||||
Preferred stock, shares outstanding | 0 | ||||||
Additional Paid-in Capital | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share-based compensation | $ | $ 97,426 | 55,793 | |||||
Director | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of options granted (in shares) | 210,000 | ||||||
Expiration period | 6 years | ||||||
Options, exercise price (in dollars per share) | $ / shares | $ 2.50 | $ 2.50 | |||||
Number of options exercised | 30,000 | ||||||
Intrinsic value of options exercised | $ | $ 6,300 | ||||||
Number of shares reserved for future issuance | 180,000 | ||||||
Intrinsic value of outstanding options | $ | $ 0 | $ 338,100 | |||||
ESPP | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of shares available for future awards | 206,980 | ||||||
Number of shares reserved for future issuance | 250,000 | ||||||
Number of offering periods | offering_period | 4 | ||||||
Number of shares issued under the ESPP | 5,609 | 4,662 | |||||
ESPP | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Purchase price, percentage | 85.00% | ||||||
Restricted Stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of restricted shares granted | 3,500 | 0 | |||||
Restricted Stock | Stock Incentive Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Weighted average grant date fair value (dollars per share) | $ / shares | $ 2.66 | ||||||
Purchase price, percentage | 100.00% | ||||||
Unrecognized stock-based compensation expense | $ | $ 421,967 | ||||||
Weighted-average vesting period | 1 year 318 days | ||||||
Total fair value of shares vested | $ | $ 59,631 | $ 15,436 | |||||
Number of shares available for future awards | 393,056 | ||||||
Restricted Stock | Stock Incentive Plan | Ratably over 3 years | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting period | 3 years | ||||||
Restricted Stock | Stock Incentive Plan | One year period | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting period | 1 year | ||||||
Restricted Stock | Stock Incentive Plan | 3 Year anniversary | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting period | 3 years |
Stock-Based Compensation (Restr
Stock-Based Compensation (Restricted Shares Transactions) (Details) - Restricted Stock - shares | 3 Months Ended | |
Mar. 27, 2016 | Mar. 29, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||
Unvested, beginning of period (in shares) | 241,124 | 164,867 |
Granted (in shares) | 3,500 | 0 |
Vested (in shares) | (30,945) | (3,334) |
Expired/Forfeited (in shares) | (10,766) | (1,917) |
Unvested, end of period (in shares) | 202,913 | 159,616 |
(Details)
(Details) | 3 Months Ended | |
Mar. 27, 2016 | Mar. 29, 2015 | |
Income Tax Disclosure [Abstract] | ||
Effective income tax rate | (49.90%) | (35.90%) |
Operating Leases (Narrative) (D
Operating Leases (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 27, 2016 | Mar. 29, 2015 | |
Operating Leased Assets [Line Items] | ||
Total rent expense | $ 2.5 | $ 1.9 |
Minimum | ||
Operating Leased Assets [Line Items] | ||
Lease terms | 5 years | |
Maximum | ||
Operating Leased Assets [Line Items] | ||
Lease terms | 24 years |
Operating Leases (Future Minimu
Operating Leases (Future Minimum Lease Payments) (Details) - Open Restaurants | Mar. 27, 2016USD ($) |
Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
Remainder of 2016 | $ 8,248,554 |
2,017 | 10,932,225 |
2,018 | 10,458,132 |
2,019 | 9,614,494 |
2,020 | 9,354,108 |
2021 and thereafter | 45,528,165 |
Total | $ 94,135,678 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Thousands | 3 Months Ended | ||
Mar. 27, 2016USD ($)restaurant | Mar. 29, 2015USD ($) | Dec. 31, 2020restaurant | |
Loss Contingencies [Line Items] | |||
Number of restaurants | 80 | ||
Royalty fees, percentage | 5.00% | ||
Royalty fees | $ | $ 2,200 | $ 1,600 | |
Advertising Fund Contribution Expenses | |||
Loss Contingencies [Line Items] | |||
Advertising fund contribution expenses | $ | $ 1,400 | $ 1,000 | |
Original Number of Restaurants Required | |||
Loss Contingencies [Line Items] | |||
Number of restaurants | 42 | ||
Open Restaurants | |||
Loss Contingencies [Line Items] | |||
Number of restaurants | 27 | ||
Additional Agreements | |||
Loss Contingencies [Line Items] | |||
Number of restaurants | 15 | ||
Exclusive of Potential Additional Restaurant Acquisitions | Scenario, Forecast | |||
Loss Contingencies [Line Items] | |||
Number of restaurants | 77 | ||
Potential Penalty Per Undeveloped Restaurant | |||
Loss Contingencies [Line Items] | |||
Modernization costs for a restaurant, minimum | $ | $ 50 | ||
Modernization costs for a restaurant, maximum | $ | $ 1,300 | ||
Minimum | Global | |||
Loss Contingencies [Line Items] | |||
Advertising fund contributions | 3.15% | ||
Maximum | Global | |||
Loss Contingencies [Line Items] | |||
Advertising fund contributions | 3.25% |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) | 3 Months Ended | |
Mar. 27, 2016 | Mar. 29, 2015 | |
Earnings Per Share [Abstract] | ||
Income available to common stockholders | $ 430,405 | $ 262,642 |
Weighted-average shares outstanding | 26,298,034 | 26,149,184 |
Effect of dilutive securities | 0 | 99,240 |
Weighted-average shares outstanding - assuming dilution | 26,298,034 | 26,248,424 |
Earnings per share (in dollars per share) | $ 0.02 | $ 0.01 |
Earnings per share - assuming dilution (in dollars per share) | $ 0.02 | $ 0.01 |
Supplemental Cash Flows Infor51
Supplemental Cash Flows Information (Details) - USD ($) | 3 Months Ended | |
Mar. 27, 2016 | Mar. 29, 2015 | |
Supplemental Cash Flow Elements [Abstract] | ||
Cash paid for interest | $ 1,400,000 | $ 419,674 |
Cash paid for income taxes | 0 | 60,000 |
Property and Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment not yet paid | $ 1,800,000 | $ 400,000 |
Fair Value of Financial Instr52
Fair Value of Financial Instruments (Details) - USD ($) | 3 Months Ended | ||
Mar. 27, 2016 | Mar. 29, 2015 | Dec. 27, 2015 | |
Fair Value Disclosures [Abstract] | |||
Level 2 to level 1 transfers, assets | $ 0 | $ 0 | |
Level 2 to level 1 transfers, liabilities | 0 | 0 | |
Asset transfers into level 3 | 0 | $ 0 | |
Liability transfers into level 3 | 0 | $ 0 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Long-term Debt | 122,101,756 | 126,255,990 | |
Interest rate swaps | (3,114,361) | ||
Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate swaps | 0 | ||
Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate swaps | (3,114,361) | ||
Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate swaps | $ 0 | ||
Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash equivalents | 2,000,000 | ||
Interest rate swaps | (1,525,255) | ||
Total | 474,745 | ||
Fair Value, Measurements, Recurring | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash equivalents | 2,000,000 | ||
Interest rate swaps | 0 | ||
Total | 2,000,000 | ||
Fair Value, Measurements, Recurring | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash equivalents | 0 | ||
Interest rate swaps | (1,525,255) | ||
Total | (1,525,255) | ||
Fair Value, Measurements, Recurring | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash equivalents | 0 | ||
Interest rate swaps | 0 | ||
Total | $ 0 |
Accumulated Other Comprehensi53
Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) | 3 Months Ended | |
Mar. 27, 2016 | Mar. 29, 2015 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Beginning balance | $ (1,006,667) | $ (175,156) |
Loss recorded to other comprehensive income | (1,589,106) | (469,801) |
Tax benefit | 540,296 | 159,732 |
Total other comprehensive loss | (1,048,810) | (310,069) |
Accumulated OCL | (2,055,477) | (485,225) |
Interest Rate Swap | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Beginning balance | (1,006,667) | (171,352) |
Loss recorded to other comprehensive income | (1,589,106) | (475,564) |
Tax benefit | 540,296 | 161,691 |
Total other comprehensive loss | (1,048,810) | (313,873) |
Accumulated OCL | (2,055,477) | (485,225) |
Investments | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Beginning balance | 0 | (3,804) |
Loss recorded to other comprehensive income | 0 | 5,763 |
Tax benefit | 0 | (1,959) |
Total other comprehensive loss | 0 | 3,804 |
Accumulated OCL | $ 0 | $ 0 |
Segment Reporting (Details)
Segment Reporting (Details) | 3 Months Ended | ||
Mar. 27, 2016USD ($)segment | Mar. 29, 2015USD ($) | Dec. 27, 2015USD ($) | |
Segment Reporting Information [Line Items] | |||
Revenue | $ 48,412,799 | $ 39,440,332 | |
Corporate expenses | (46,726,050) | (38,831,828) | |
Total consolidated operating profit | 1,686,749 | 608,504 | |
Interest expense | (1,444,940) | (432,223) | |
Other income, net | 45,272 | 17,003 | |
Income before income taxes | 287,081 | 193,284 | |
Assets | $ 160,556,602 | $ 165,772,495 | |
Number of reportable segments | segment | 2 | ||
BWW | |||
Segment Reporting Information [Line Items] | |||
Assets | $ 117,530,474 | 115,044,166 | |
Bagger Dave's | |||
Segment Reporting Information [Line Items] | |||
Assets | 22,262,803 | 21,886,470 | |
Corporate, Non-Segment | |||
Segment Reporting Information [Line Items] | |||
Assets | 20,763,325 | $ 28,841,859 | |
Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Revenue | 48,412,799 | 39,440,332 | |
Total segment operating profit | 4,673,385 | 3,147,697 | |
Closure-related expenses | (345,011) | 0 | |
Operating Segments | BWW | |||
Segment Reporting Information [Line Items] | |||
Revenue | 43,143,252 | 31,852,089 | |
Total segment operating profit | 5,285,645 | 4,606,331 | |
Operating Segments | Bagger Dave's | |||
Segment Reporting Information [Line Items] | |||
Revenue | 5,269,547 | 7,588,243 | |
Total segment operating profit | (612,260) | (1,458,634) | |
Corporate, Non-Segment | |||
Segment Reporting Information [Line Items] | |||
Corporate expenses | $ (2,641,625) | $ (2,539,193) |