Cover
Cover - shares | 3 Months Ended | |
Apr. 01, 2024 | May 10, 2024 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Apr. 01, 2024 | |
Document Transition Report | false | |
Entity File Number | 001-38417 | |
Entity Registrant Name | BurgerFi International, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 82-2418815 | |
Entity Address, Address Line One | 200 West Cypress Creek Rd., | |
Entity Address, Address Line Two | Suite 220 | |
Entity Address, City or Town | Fort Lauderdale | |
Entity Address, State or Province | FL | |
Entity Address, Postal Zip Code | 33309 | |
City Area Code | 954 | |
Local Phone Number | 618-2000 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 27,403,547 | |
Entity Central Index Key | 0001723580 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-30 | |
Common Stock, par value $0.0001 per share | ||
Document Information [Line Items] | ||
Title of 12(b) Security | Common Stock, par value $0.0001 per share | |
Trading Symbol | BFI | |
Security Exchange Name | NASDAQ | |
Redeemable warrants, each exercisable for one share of common stock at an exercise price of $11.50 per share | ||
Document Information [Line Items] | ||
Title of 12(b) Security | Redeemable warrants, each exercisable for one share of common stock at an exercise price of $11.50 per share | |
Trading Symbol | BFIIW | |
Security Exchange Name | NASDAQ |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Apr. 01, 2024 | Jan. 01, 2024 |
Current Assets | ||
Cash and cash equivalents | $ 4,147 | $ 7,556 |
Accounts receivable, net | 1,355 | 1,368 |
Inventory | 1,305 | 1,190 |
Assets held for sale | 732 | 732 |
Prepaid expenses and other current assets | 2,420 | 1,654 |
Total Current Assets | 9,959 | 12,500 |
Property & Equipment, net | 16,586 | 16,121 |
Operating right-of-use assets, net | 44,260 | 46,052 |
Goodwill | 31,621 | 31,621 |
Intangible assets, net | 148,791 | 150,856 |
Other assets | 1,391 | 1,326 |
Total Assets | 252,608 | 258,476 |
Current Liabilities | ||
Accounts payable - trade and other | 5,128 | 7,093 |
Accrued expenses | 11,226 | 8,537 |
Short-term operating lease liability | 10,229 | 10,111 |
Other current liabilities | 2,951 | 4,117 |
Short-term borrowings, including finance leases | 53,064 | 52,834 |
Total Current Liabilities | 82,598 | 82,692 |
Non-Current Liabilities | ||
Long-term borrowings and Related party note payable | 16,749 | 16,206 |
Redeemable preferred stock, $0.0001 par value, $10,000,000 shares authorized, $2,120,000 shares issued and outstanding, as of April 1, 2024 and January 1, 2024, $53 million principal redemption value | 56,734 | 55,629 |
Long-term operating lease liability | 42,555 | 44,631 |
Warrant liability | 38 | 182 |
Other non-current liabilities | 694 | 740 |
Deferred income taxes | 1,146 | 1,146 |
Total Liabilities | 200,514 | 201,226 |
Commitments and Contingencies - Note 8 | ||
Stockholders' Equity | ||
Common stock, $0.0001 par value, $100,000,000 shares authorized, $27,042,213 and $26,832,691 shares issued and outstanding as of April 1, 2024 and January 1, 2024, respectively | 2 | 2 |
Additional paid-in capital | 315,989 | 315,107 |
Accumulated deficit | (264,397) | (257,859) |
Total Stockholder's Equity Attributable to BurgerFi | 51,594 | 57,250 |
Non-controlling interests in subsidiaries | 500 | 0 |
Total Stockholders' Equity | 52,094 | 57,250 |
Total Liabilities and Stockholders' Equity | 252,608 | 258,476 |
Nonrelated Party | ||
Non-Current Liabilities | ||
Long-term borrowings and Related party note payable | 2,223 | 1,718 |
Related Party | ||
Non-Current Liabilities | ||
Long-term borrowings and Related party note payable | $ 14,526 | $ 14,488 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Apr. 01, 2024 | Jan. 01, 2024 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in USD per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 2,120,000 | 2,120,000 |
Preferred stock, shares outstanding (in shares) | 2,120,000 | 2,120,000 |
Preferred stock, redemption value | $ 53 | $ 53 |
Common stock, par value (in USD per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 27,042,213 | 27,042,213 |
Common stock, shares outstanding (in shares) | 27,042,213 | 26,832,691 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 01, 2024 | Apr. 03, 2023 | |
Revenue | ||
Total Revenue | $ 42,879 | $ 45,726 |
Restaurant level operating expenses: | ||
Food, beverage and paper costs | 10,977 | 11,611 |
Labor and related expenses | 13,912 | 13,216 |
Other operating expenses | 7,128 | 7,456 |
Occupancy and related expenses | 3,890 | 3,834 |
General and administrative expenses | 5,309 | 6,573 |
Depreciation and amortization expense | 3,044 | 3,227 |
Share-based compensation expense | 954 | 4,674 |
Brand development, co-op and advertising expense | 1,252 | 1,096 |
Lease termination recovery | (56) | 0 |
Store closure costs | 435 | 121 |
Restructuring costs | 79 | 918 |
Pre-opening costs | 163 | 0 |
Operating Loss | (4,208) | (7,000) |
Other income, net | 3 | 0 |
Gain (loss) on change in fair value of warrant liability | 144 | (73) |
Interest expense, net | (2,477) | (2,078) |
Loss before income taxes | (6,538) | (9,151) |
Income tax provision | 0 | 0 |
Net Loss | (6,538) | (9,151) |
Net Loss attributable to non-controlling interest in subsidiaries | 0 | 0 |
Net Loss attributable to BurgerFi | $ (6,538) | $ (9,151) |
Weighted average common shares outstanding: | ||
Basic (in shares) | 27,021,716 | 23,568,032 |
Diluted (in shares) | 27,021,716 | 23,568,032 |
Net loss per common share: | ||
Basic (in USD per share) | $ (0.24) | $ (0.39) |
Diluted (in USD per share) | $ (0.24) | $ (0.39) |
Restaurant Sales | ||
Revenue | ||
Revenue from contract with customer | $ 40,885 | $ 43,316 |
Royalty and other fees | ||
Revenue | ||
Revenue not from contract with customer | 1,558 | 1,969 |
Royalty - brand development and co-op | ||
Revenue | ||
Revenue not from contract with customer | $ 436 | $ 441 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands | Total | Total Stockholders’ Equity Attributable to BurgerFi | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Non-controlling interests |
Balance at beginning of period (in shares) at Jan. 02, 2023 | 22,257,772 | |||||
Balance at beginning of period at Jan. 02, 2023 | $ 78,947 | $ 78,947 | $ 2 | $ 306,096 | $ (227,151) | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Share-based compensation | 4,674 | 4,674 | 4,674 | |||
Vested shares issued (in shares) | 1,639,174 | |||||
Shares issued in legal settlement (in shares) | 200,000 | |||||
Shares issued in legal settlement | 351 | 351 | 351 | |||
Shares withheld for taxes (in shares) | (273,841) | |||||
Shares withheld for taxes | (353) | (353) | (353) | |||
Net loss / Net (loss) income | (9,151) | (9,151) | (9,151) | |||
Balance at end of period (in shares) at Apr. 03, 2023 | 23,823,105 | |||||
Balance at end of period at Apr. 03, 2023 | 74,468 | 74,468 | $ 2 | 310,768 | (236,302) | 0 |
Balance at beginning of period (in shares) at Jan. 01, 2024 | 26,832,691 | |||||
Balance at beginning of period at Jan. 01, 2024 | 57,250 | 57,250 | $ 2 | 315,107 | (257,859) | 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of shares in subsidiary | 500 | 500 | ||||
Share-based compensation | 954 | 954 | 954 | |||
Vested shares issued (in shares) | 209,522 | |||||
Shares withheld for taxes | (72) | (72) | (72) | |||
Net loss / Net (loss) income | (6,538) | (6,538) | (6,538) | |||
Balance at end of period (in shares) at Apr. 01, 2024 | 27,042,213 | |||||
Balance at end of period at Apr. 01, 2024 | $ 52,094 | $ 51,594 | $ 2 | $ 315,989 | $ (264,397) | $ 500 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 01, 2024 | Apr. 03, 2023 | |
Cash Flows Used In (Provided By) Operating Activities | ||
Net Loss | $ (6,538) | $ (9,151) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities | ||
Lease termination recovery | (56) | 0 |
Depreciation and amortization | 3,044 | 3,227 |
Share-based compensation | 954 | 4,674 |
Gain on legal settlement | 0 | 131 |
Gift card and loyalty program breakage | (425) | (201) |
Forfeited franchise deposits | (56) | (41) |
Non-cash lease cost | (163) | 123 |
(Gain) loss on change in value of warrant liability | (144) | 73 |
Other non-cash interest | 1,283 | 1,167 |
Other, net | 0 | 20 |
Changes in operating assets and liabilities | ||
Accounts receivable | 13 | (34) |
Inventory | (115) | (108) |
Prepaid expenses and other assets | (831) | (180) |
Accounts payable - trade and other | (1,839) | 426 |
Accrued expenses and other current liabilities | 1,947 | (2,176) |
Other long-term liabilities | 10 | 89 |
Cash Flows Used in Operating Activities | (2,916) | (1,961) |
Net Cash Flows Used In Investing Activities | ||
Purchases of property and equipment | (837) | (802) |
Other investing activities | 3 | 0 |
Net Cash Flows Used In Investing Activities | (834) | (802) |
Net Cash Flows Provided By (Used In) Financing Activities | ||
Contributions from non-controlling interests in subsidiaries | 500 | 0 |
Payments on borrowings | (21) | (4,836) |
Proceeds from related party note payable | 0 | 5,100 |
Tax payments for restricted stock upon vesting | (72) | (353) |
Repayments of finance leases | (66) | (39) |
Net Cash Flows Provided By (Used in) Financing Activities | 341 | (128) |
Net Decrease in Cash and Cash Equivalents | (3,409) | (2,891) |
Cash and Cash Equivalents, beginning of period | 7,556 | 11,917 |
Cash and Cash Equivalents, end of period | 4,147 | 9,026 |
Supplemental cash flow disclosures: | ||
Cash paid for interest | 1,296 | 1,562 |
Fair value of net liabilities assumed in legal settlement | 0 | (79) |
Fair value of common stock issued in legal settlement | 0 | (351) |
ROU assets obtained in the exchange for lease liabilities: | ||
Finance leases | 738 | 0 |
Operating leases | $ 0 | $ 1,433 |
Organization
Organization | 3 Months Ended |
Apr. 01, 2024 | |
Accounting Policies [Abstract] | |
Organization | Organization BurgerFi International, Inc. and its wholly owned subsidiaries ( “BurgerFi,” or the “Company,” also “we,” “us,” and “our” ), is a multi-brand restaurant company that develops, markets and acquires fast-casual and premium-casual dining restaurant concepts around the world, including corporate-owned stores and franchises located in the United States, Puerto Rico and Saudi Arabia. As of April 1, 2024, the Company had 162 franchised and corporate-owned restaurants of the two following brands: BurgerFi . BurgerFi is a fast-casual “better burger” concept with 102 franchised and corporate-owned restaurants as of April 1, 2024, offering burgers, hot dogs, crispy chicken, hand-cut fries, frozen custard and shakes, beer, wine and more. Anthony’s . Anthony’s is a pizza and wing brand that operated 60 restaurants including 59 corporate-owned and one f ranchise location co-branded with BurgerFi as of April 1, 2024. The concept is centered around a coal-fired oven, and its menu offers “well-done” pizza, coal-fired chicken wings, homemade meatballs, and a variety of handcrafted sandwiches and salads. Corporate-owned stores and Franchised stores Store activity for the quarter ended April 1, 2024 and the year ended January 1, 2024 is as follows: April 1, 2024 January 1, 2024 Corporate-owned Franchised Total Corporate-owned Franchised Total Total BurgerFi and Anthony's 86 76 162 87 81 168 BurgerFi stores, beginning of the period 28 80 108 25 89 114 BurgerFi stores opened 1 1 2 — 8 8 BurgerFi stores acquired / (transferred) — — — 4 (4) — BurgerFi stores closed (2) (6) (8) (1) (13) (14) BurgerFi total stores, end of the period 27 75 102 28 80 108 Anthony's stores, beginning of period 59 1 60 60 — 60 Anthony's stores opened — — — — 1 1 Anthony's stores closed — — — (1) — (1) Anthony's total stores, end of the period 59 1 60 59 1 60 End of period store totals included one |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Apr. 01, 2024 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation The accompanying Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles in the United States of America ( “GAAP” ) and the rules and regulations of the Securities and Exchange Commission ( “SEC” ) assuming the Company will continue as a going concern. T he going concern assumption contemplates the realization of assets and satisfaction of liabilities in the normal course of business. However, as discussed below and elsewhere through this Quarterly Report on Form 10-Q, substantial doubt about the Company’s ability to continue as a going concern existed as of April 1, 2024 as a result of non-compliance of the Company’s liquidity covenant within the Company’s Credit Agreement. Please see Part I, Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations, as well as Risk Factors in the Company’s Annual Report on Form 10-K for the year ended January 1, 2024 (the “ 2023 Form 10-K ”) and this Quarterly Report on Form 10-Q, for further information. The Company’s credit agreement (“Credit Agreement”) with a syndicate of banks has Term Loan and Revolving line of credit financing of approximately $51.3 million and $2.0 million, respectively, outstanding as of April 1, 2024, and expires on September 30, 2025. The Credit Agreement contains various covenants, including requirements for the Company to meet certain trailing twelve-month quarterly financial ratios and a minimum liquidity threshold. As of April 1, 2024, the Company was not in compliance with the minimum liquidity requirement of the Credit Agreement, which constitutes a breach of the Credit Agreement and an event of default. Accordingly, the outstanding balance of the Credit Agreement is included in short-term borrowings together with the short term portion of other notes payable an d outstanding balances under its finance leases on the accompanying consolidated balance sheets. This event of default entitles the lenders to call the debt sooner than its maturity date of September 30, 2025. The Company does not have and is not forecasted to have the readily available funds to repay the debt if called by the lenders. The Company has been actively engaged in discussions with its lenders to explore potential solutions regarding the default event and its resolution. We cannot, however, predict the results of any such negotiations. The consolidated financial statements do not include any adjustments to the carrying amounts and classification of assets, liabilities, and reported expenses that may be necessary if the Company were unable to continue as a going concern. From April 15, 2024 to April 17, 2024, the Company received notices from the syndicate of commercial bank lenders under the Credit Agreement that each lender’s respective (i) rights and obligations as a lender under the Credit Agreement and any other document or instruments delivered pursuant thereto to the extent related to the amount and percentage interest of the loans and commitments under the Credit Agreement held by such lender and (ii) to the extent permitted by applicable law, all claims, suits, causes of action and any other right of such lender against any person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing rights and obligations under the Credit Agreement were assigned to TREW Capital Management Private Credit 2 LLC (“ TREW ”). The foregoing assignments represented 100% of the amount of revolving loan commitments under the Credit Agreement and 100% of the amount of term loan under the Credit Agreement. The Company has initiated discussions with TREW with respect to potential solutions regarding the event of default described above. See Note 10, “ Debt ,” for additional disclosure surrounding the amended Credit Agreement. The accompanying condensed consolidated financial statements are unaudited and have been prepared in accordance with GAAP for interim financial information and with the instructions for Form 10-Q and Rule 8-03 of Regulation S-X. Pursuant to these rules and regulations, certain information and footnote disclosures normally included in the annual audited consolidated financial statements prepared in accordance with GAAP have been condensed or omitted. The accompanying condensed consolidated balance sheet as of January 1, 2024 is derived from the Company’s audited financial statements as of that date. Because certain information and footnote disclosures have been condensed or omitted, these condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto as of and for the year ended January 1, 2024 contained in the 2023 Form 10-K. In the opinion of management, all normal recurring adjustments necessary for a fair presentation have been included in the condensed consolidated financial statements. We are required to evaluate events occurring after April 1, 2024 for recognition and disclosure in the unaudited consolidated financial statements for the quarter ended April 1, 2024. Events are evaluated based on whether they represent information existing as of April 1, 2024, which require recognition, or new events occurring after April 1, 2024 which do not require recognition but require disclosure if the event is significant. We evaluated events occurring subsequent to April 1, 2024 through the date of issuance of these unaudited consolidated financial statements. The Company reports on a 52-53-week fiscal year ending on the Monday nearest to December 31 of each year. Our first fiscal quarter of 2024 ended on April 1, 2024. Our current fiscal year will end on December 30, 2024. Principles of Consolidation The consolidated financial statements present the consolidated financial position, results from operations and cash flows of BurgerFi International, Inc., and its wholly owned subsidiaries. All material balances and transactions between the entities have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingencies at the date of the unaudited consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. New Accounting Pronouncements The Company reviewed all recently issued accounting pronouncements and concluded that they were not applicable or not expected to have a significant impact on the accompanying consolidated financial statements. Prepaid expenses The Company routinely issues prepayments to landlords, insurers and vendors in the ordinary course of business. As of April 1, 2024 and January 1, 2024, the Company had $2.2 million and $1.3 million, respectively of prepayments included in prepaid expenses and other current assets in the accompanying consolidated balance sheets. Assets Held for Sale In February 2020, the Company entered into an asset purchase agreement with an unrelated third party for the sale of substantially all of the assets used in connection with the operation of BF Dania Beach, LLC. The closing of this transaction has been delayed due to additional on-going negotiations. In the event the transaction is terminated, the Company will begin operating this BurgerFi restaurant, and return the deposit of $0.9 million included in other current liabilities to the unrelated third-party purchaser. Assets used in the operations of BF Dania Beach, LLC totaling $0.7 million have been classified as held for sale in the accompanying consolidated balance sheets as of April 1, 2024 and January 1, 2024. On April 28, 2024, the parties executed a settlement term sheet to continue the trial related to this matter. The parties are drafting a formal settlement agreement for Court ratification. Refer to Note 8, “ Commitments and Contingencies ,” for further discussion. Other Current Liabilities The Company incurs liabilities associated with the sale of gift cards and gift certificates. As of April 1, 2024 and January 1, 2024, the Company had $1.2 million and $2.2 million, respectively of gift card and gift certificate liabilities included in other current liabilities on the accompanying consolidated balance sheets. The decrease in gift card liabilities at April 1, 2024 compared to January 1, 2024 relates to the expiration of the Company’s Holiday Gift Card Program. The Company incurs liabilities resulting from its customer loyalty program. As of April 1, 2024 and January 1, 2024, the Company had $0.8 million and $1.0 million, respectively of liabilities for its loyalty program in the accompanying consolidated balance sheets. Restructuring Costs Restructuring costs for the periods shown consist of the following: Quarter Ended (in thousands) April 1, 2024 April 3, 2023 Expenses related to financing $ 73 $ 891 Severance and onboarding costs associated with change in CEO and CFO 6 27 Total $ 79 $ 918 |
Property & Equipment
Property & Equipment | 3 Months Ended |
Apr. 01, 2024 | |
Property, Plant and Equipment [Abstract] | |
Property & Equipment | Property & Equipment Property and equipment consisted of (in thousands) April 1, 2024 January 1, 2024 Leasehold improvements $ 18,373 $ 17,579 Kitchen equipment and other equipment 8,928 8,708 Computers and office equipment 1,586 1,536 Furniture and fixtures 2,868 2,828 Vehicles 9 8 31,764 30,659 Less: Accumulated depreciation and amortization (15,178) (14,538) Property and equipment – net $ 16,586 $ 16,121 |
Goodwill and Intangible Assets,
Goodwill and Intangible Assets, Net | 3 Months Ended |
Apr. 01, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets, Net | Goodwill and Intangible Assets, Net The following is a summary of the components of intangible assets and the related amortization expense and impairment charges: April 1, 2024 (in thousands) Weighted Average Remaining Useful Life (years) Amount Accumulated Amortization Accumulated Impairment Charges Net Carrying Value Franchise agreements 3.7 $ 24,839 $ (11,680) $ — 13,159 BurgerFi trade names / trademarks 26.7 83,033 (9,111) — 73,922 Anthony's trade names / trademarks 27.6 60,690 (4,889) — 55,801 Other intangibles 6.7 9,018 (1,221) (7,706) 91 Subtotal 177,580 (26,901) (7,706) 142,973 Liquor licenses 5,930 — (113) 5,818 Total intangible assets, net $ 183,510 $ (26,901) $ (7,818) $ 148,791 January 1, 2024 (in thousands) Weighted Average Remaining Useful Life (years) Amount Accumulated Amortization Accumulated Impairment Charges Net Carrying Value Franchise agreements 4.0 $ 24,839 $ (10,793) $ — 14,046 BurgerFi trade names / trademarks 27.0 83,033 (8,419) — 74,614 Anthony's trade names / trademarks 27.8 60,690 (4,383) — 56,307 Other intangibles 7.0 9,018 (1,241) (7,706) 71 Subtotal 177,580 (24,836) (7,706) 145,038 Liquor licenses 5,930 — (113) 5,818 Total intangible assets, net $ 183,510 $ (24,836) $ (7,818) $ 150,856 (in thousands) Anthony’s Segment BurgerFi Segment Total Balance as of January 2, 2023 Goodwill $ 80,684 123,981 $ 204,665 Accumulated impairment losses (49,064) (123,981) (173,045) Goodwill, net as of January 1, 2024 $ 31,621 $ — $ 31,621 Goodwill $ 80,684 $ 123,981 $ 204,665 Accumulated impairment losses (49,064) $ (123,981) (173,045) Goodwill, net as of April 1, 2024 $ 31,621 $ — $ 31,621 |
Contract Liabilities
Contract Liabilities | 3 Months Ended |
Apr. 01, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Contract Liabilities | Contract Liabilities A roll forward of contract liabilities is as follows: Quarter Ended (in thousands) April 1, 2024 April 3, 2023 Balance, beginning of period $ 745 $ 1,092 Initial/Transfer franchise fees received — 156 Revenue recognized for stores open and transfers during period (4) (68) Revenue recognized related to franchise agreement terminations (56) (41) Other unearned revenue (recognized) received — (24) Balance, end of period $ 685 $ 1,115 Franchise Revenue Revenue recognized during the periods included in royalty and other fees on our consolidated statement of operations was as follows: Quarter Ended April 1, 2024 April 3, 2023 Franchise Fees $ 60 $ 133 |
Net Loss Per Share
Net Loss Per Share | 3 Months Ended |
Apr. 01, 2024 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | Net Loss Per Share Net Loss per common share is computed by dividing Net Loss by the weighted average number of common shares outstanding for the period. The Company has considered the effect of (1) warrants outstanding to purchase 15,063,800 shares of common stock, (2) 2,423,069 shares of restricted stock units outstanding in the calculation of net loss per common share, and (3) the impact of any dividends associated with our redeemable preferred stock. As the effect of these on the computation of net loss per common share would have been anti-dilutive, they were excluded from the weighted average number of common shares outstanding. Basic and diluted net loss per common share is calculated as follows: (in thousands, except for per share data) Quarter Ended Numerator: April 1, 2024 April 3, 2023 Net loss available to common stockholders - diluted $ (6,538) $ (9,151) Denominator: Basic and diluted weighted-average shares outstanding 27,021,716 23,568,032 Basic and diluted net loss per common share $ (0.24) $ (0.39) |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Apr. 01, 2024 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions The Company is affiliated with various entities through common control and ownership. On January 23, 2023, the Company settled a claim filed by a significant stockholder. The settlement resulted in the transfer of five BurgerFi entities from the stockholder to the Company of which two were operating stores and three were entities that historically had operated stores but have since closed. The fair value of consideration paid in the settlement was $0.9 million and included $0.5 million in cash and the issuance of 200,000 shares in common stock valued at $0.4 million. The fair value of net liabilities assumed in the transaction was $0.1 million which included lease liabilities and operating assets and liabilities including property and equipment of two operating stores, net of pre-existing liabilities accrued. Pursuant to a lease amendment entered into in February 2022, the Company leases building space for its corporate office from an entity controlled by the Company's Executive Chairman of the Board. This lease has a 10-year term with an option to renew. Rent expense was approximately $0.2 million for each of the quarters ended April 1, 2024 and April 3, 2023, On June 3, 2023, the Company entered into a stock purchase agreement with an investing entity for the sale of 2,868,853 shares of Company common stock at an issuance price of $1.22 per share for total proceeds of $3.4 million. Upon the execution of this agreement, the investing entity became a holder of approximately 11% of the Company’s outstanding common stock. During the year ended January 1, 2024, the Company entered into four franchise agreements with an affiliate of this entity. The Company received royalty revenue from such franchises related to a significant stockholder totaling approximately $0.1 million for the quarter ended April 1, 2024. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Apr. 01, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Litigation Lion Point Capital, L.P.(“Lion Point”) v. BurgerFi International, Inc. (Supreme Court of the State of New York County of New York, Index No. 653099/2022, filed August 26, 2022 . A lawsuit filed by Lion Point against the Company, alleging that the Company failed to timely register Lion Point’s shares in violation of the registration rights agreement to which Lion Point is a party, which allegedly resulted in losses in excess of $26.0 million. In November 2022, as amended in February 2023, the Company filed its answer to the complaint. On April 13, 2023, Lion Point filed a Motion for Summary Judgment, and the Company responded with its reply on June 22, 2023. On October 12, 2023, the Court granted Lion Point’s Motion for Summary Judgment and set a status conference for November 15, 2023 to begin the damages phase of the case. At status conference on November 15, 2023, a schedule for discovery deadlines was discussed and set out by the Court. The next status conference was continued from March 13, 2024 to April 24, 2024. At the April 24, 2024 status conference a revised discovery schedule was agreed to and the case is scheduled to proceed with the discovery schedule and depositions. The Company continues to believe that all claims are meritless and plans to vigorously defend such claims. The Company is unable to determine the likelihood of a loss or range of loss, if any, which may result from the case described above, and any losses, however, may be material to the Company's financial position and results of operations. Burger Guys of Dania Pointe, et. al. v. BFI, LLC (Circuit Court of the 15 th Judicial Circuit in and for Palm Beach County, Florida, Case No. 50-2021-CA -006501-XXXX-MB filed May 21, 2021). In response to a demand letter issued by BurgerFi to Gino Gargiulo, a former franchisee, demanding that Mr. Gargiulo pay the balance owed under an asset purchase agreement wherein BurgerFi sold the Dania Beach, Florida BurgerFi location to Mr. Gargiulo, Mr. Gargiulo filed suit against BurgerFi claiming, in addition to other matters, that no further monies are owed under the asset purchase agreement and alleges that the Company is responsible for one of Mr. Gargiulo’s failed franchises in Sunny Isles, Florida, losses he has allegedly sustained at his Dania Beach location, and reimbursement of expenses in connection with his marketing company. Mr. Gargiulo seeks damages in excess of $2.0 million in the aggregate. The parties attended mediation on January 20, 2022, which ended in an impasse. Mr. Gargiulo amended his complaint in April 2022, which, among other matters, amended the defendant parties. In October 2022, the Company filed an additional motion to dismiss the amended complaint and a motion to stay discovery. In January 2023, Mr. Gargiulo filed a third amended complaint. In March 2023, the Company filed an answer to Mr. Gargiulo’s complaint and a counterclaim against Mr. Gargiulo relating to the breach of the asset purchase agreement discussed above. On November 5, 2023, the parties attended mediation, which ended in an impasse. Depositions are ongoing and a trial was set for the 5 week docket beginning the week of April 15, 2024. On April 28, 2024, the parties executed a settlement term sheet to continue the trial. The parties are in the process of drafting a formal settlement agreement for Court ratification. On May 1, 2024, a joint stipulation to stay the case for 90 days was filed with the Court to allow for completion of the settlement agreement. On May 12, 2024, the Court entered an order staying the case for 90 days. The settlement term sheet provides for $2.0 million in payments for purchase of the two franchised locations in Aventura and Dania Pointe. Transfer of ownership to the Company is intended to occur upon the completion of the settlement payment requirements or earlier buyout. The settlement payments consist of an initial payment of $0.3 million due on August 1, 2024 and additional payments of $1.7 million in royalty relief for the Aventura and Dania Pointe locations. Employment Related Claims . In July 2021, the Company received a demand letter from the attorney of one of its now former hourly restaurant employees. The letter alleges that the former employee was sexually harassed by one of her co-workers. The demand letter claims that the Company discriminated and retaliated against the former employee based on her gender and age and also alleged intentional infliction of emotional distress, negligent hiring, negligent training, and negligent supervision. While the Company entered into a partial settlement with the former employee in December 2022 for a de minimis cash amount relating solely to the discrimination claim, the other claims remain. In March 2020, the Company received notification of a U.S. Equal Employment Opportunity Commission (the “EEOC” ) complaint claiming sexual harassment and assault. On July 5, 2023, the EEOC issued a determination letter declining to investigate the matter further and issued a right to sue letter. On September 29, 2023, the claimant filed a lawsuit. The suit is in the early stages and the Company is currently working through initial responses. On or about April 4, 2024, the Company received a demand letter regarding a former employee’s claims of a racially and sexually abusive, discriminatory, hostile and retaliatory work environment. The demand letter is in the early stages and the Company is currently working through the allegations. On or about April 15, 2024, the Company was served with a lawsuit alleging wrongful termination of a store manager that is seeking damages for among other items, back pay, emotional distress and front pay. The suit is in the early stages and the Company is currently working through initial responses. While the Company believes that all claims of the above mentioned Employment Related Claims, which are covered under the Company’s insurance policies, are meritless, and it plans to defend these allegations, it is reasonably possible that the Company may ultimately be required to pay damages to the claimants, which could be up to $0.5 million or more in aggregate compensatory damages, attorneys’ fees and costs. Management believes that any liability, in excess of applicable insurance coverages or accruals, which may result from these claims, would not be significant to the Company’s financial position or results of operations. General Liability and Other Claims. The Company is subject to other legal proceedings and claims that arise during the normal course of business, including landlord disputes, slip and fall cases, and various food related matters. While it intends to vigorously defend these matters, it is reasonably possible that the Company may be required to pay substantial damages to the claimants. Management believes that any liability, in excess of applicable insurance coverages or accruals, which may result from these claims, would not be significant to the Company’s financial position or results of operations. Purchase Commitments From time to time, we enter into purchase commitments for certain food commodities in the normal course of business. As of April 1, 2024, we entered into approximately $5.7 million in unconditional purchase obligations over the next twelve months. |
Leases
Leases | 3 Months Ended |
Apr. 01, 2024 | |
Leases [Abstract] | |
Leases | Leases The Company has entered into various lease agreements and these agreements expire on various dates through 2032 and have renewal options. The components of lease expense for the periods shown is as follows: Quarter Ended (in thousands) Classification April 1, 2024 April 3, 2023 Operating lease cost Occupancy and related expenses $ 3,271 $ 3,107 Pre-opening costs 77 — Store closure costs 115 — Lease termination recovery Asset impairment (56) $ — Finance lease cost: Amortization of right-of use assets Depreciation and amortization expense 88 58 Interest on lease liabilities Interest expense 45 14 Less: Sublease income Occupancy and related expenses (71) (47) Total lease cost $ 3,469 $ 3,132 The maturity of the Company's operating and finance lease liabilities as of April 1, 2024 is as follows: (in thousands) Operating Leases Finance Leases 2024 $ 10,394 $ 410 2025 13,331 533 2026 11,672 504 2027 10,033 472 2028 8,397 448 2029 and thereafter 10,125 561 Total undiscounted lease payments 63,952 2,928 Less: present value adjustment (11,168) (736) Total net lease liabilities $ 52,784 $ 2,192 As most of the Company's leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The Company gives consideration to its recent debt issuances as well as publicly available data for instruments with similar characteristics when calculating its incremental borrowing rates. A summary of lease terms and discount rates for finance and operating leases is as follows: April 1, 2024 April 3, 2023 Weighted-average remaining lease term (in years) Operating leases 5.3 5.9 Finance leases 5.9 6.1 Weighted-average discount rate Operating leases 7.6 % 6.3 % Finance leases 10.5 % 6.0 % |
Leases | Leases The Company has entered into various lease agreements and these agreements expire on various dates through 2032 and have renewal options. The components of lease expense for the periods shown is as follows: Quarter Ended (in thousands) Classification April 1, 2024 April 3, 2023 Operating lease cost Occupancy and related expenses $ 3,271 $ 3,107 Pre-opening costs 77 — Store closure costs 115 — Lease termination recovery Asset impairment (56) $ — Finance lease cost: Amortization of right-of use assets Depreciation and amortization expense 88 58 Interest on lease liabilities Interest expense 45 14 Less: Sublease income Occupancy and related expenses (71) (47) Total lease cost $ 3,469 $ 3,132 The maturity of the Company's operating and finance lease liabilities as of April 1, 2024 is as follows: (in thousands) Operating Leases Finance Leases 2024 $ 10,394 $ 410 2025 13,331 533 2026 11,672 504 2027 10,033 472 2028 8,397 448 2029 and thereafter 10,125 561 Total undiscounted lease payments 63,952 2,928 Less: present value adjustment (11,168) (736) Total net lease liabilities $ 52,784 $ 2,192 As most of the Company's leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The Company gives consideration to its recent debt issuances as well as publicly available data for instruments with similar characteristics when calculating its incremental borrowing rates. A summary of lease terms and discount rates for finance and operating leases is as follows: April 1, 2024 April 3, 2023 Weighted-average remaining lease term (in years) Operating leases 5.3 5.9 Finance leases 5.9 6.1 Weighted-average discount rate Operating leases 7.6 % 6.3 % Finance leases 10.5 % 6.0 % |
Debt
Debt | 3 Months Ended |
Apr. 01, 2024 | |
Debt Disclosure [Abstract] | |
Debt | Debt (in thousands) April 1, 2024 January 1, 2024 Term loan $ 51,253 $ 51,253 Related party note payable 15,100 15,100 Revolving line of credit 2,000 2,000 Other notes payable 680 701 Finance lease liability 2,192 1,576 Total Debt $ 71,225 $ 70,630 Less: Unamortized debt discount related party note (574) (612) Less: Unamortized debt issuance costs (838) (978) Total Debt, net 69,813 69,040 Less: Short-term borrowing, including finance leases (53,064) (52,834) Total Long-term borrowings, including finance leases and related party note payable $ 16,749 $ 16,206 The Credit Agreement provides the Company with lender financing structured as a $57.8 million term loan and a $4.0 million revolving loan. On February 1, 2023, the Credit Agreement was amended through the Fourteenth Amendment and subsequently on February 24, 2023 further amended through the Fifteenth Amendment resulting in the Company and its subsidiaries entering into a Secured Promissory Note (the “ Note” ) with CP7 Warming Bag L.P., an affiliate of L. Catterton Fund L.P., as lender (the “ Junior Lender ”), pursuant to which the Junior Lender continued that certain delayed draw term loan (the “Delayed Draw Term Loan”) of $10.0 million, under the Credit Agreement, which is junior subordinated secured indebtedness, and also provided $5.1 million of new junior subordinated secured indebtedness, to the Company (collectively the “ Junior Indebtedness ”), for a total of $15.1 million in junior subordinated secured debt on terms reasonably acceptable to the Required Lenders (as defined in the Credit Agreement), including, without limitation, that (1) such indebtedness shall not mature until at least two (2) years after the maturity date of the credit facility of September 30, 2025 ; (2) no payments of cash interest shall be made on such indebtedness until after the repayment in full of the obligations under the Credit Agreement; and (3) no scheduled or voluntary payments of principal shall be made until after the repayment in full of the obligations under the Credit Agreement. On July 7, 2023, the Credit Agreement was amended through the Sixteenth Amendment, which amended the definition of EBITDA for the purposes of expanding the scope of non-recurring items that may be included in the determination of Adjusted EBITDA, as well as modifications to certain covenants for leverage and fixed charge ratios. As of April 1, 2024, the Company was not in compliance with the minimum liquidity requirement of the Credit Agreement,which constitutes a breach of the Credit Agreement and an event of default. Accordingly, the outstanding balance of the Credit Agreement is included in short-term borrowings together with the short term borrowings, including finance leases in the accompanying consolidated balance sheets. The Company is not forecasted to have the readily available funds to repay the debt if the lenders do call the debt, which raises substantial doubt about the Company’s ability to continue as a going concern within one year after the date the consolidated financial statements are issued. As discussed in Note 2 “ Summary of Significant Accounting Policies ”, the Company received notices from the syndicate of commercial banks under the Credit Agreement that all of the rights, obligations and claims under the Credit Agreement were assigned to TREW. The Company has initiated discussions with TREW with respect to potential solutions regarding the event of default described above. The terms of the Credit Agreement as amended require the Company to repay the principal of the term loan in quarterly installments, and pay the outstanding balance on the revolving line of credit at maturity; however, due to event of default we classified all of the principal as payable within the next nine months as follows: in thousands 2024 $ 53,253 2025 — 2026 — 2027 15,100 2028 — Total $ 68,353 The Credit Agreement, including the term loan and revolving line of credit, is secured by substantially all of the Company’s assets and incurs interest on outstanding amounts at the following rates per annum through maturity: Time Period Interest Rate From January 1, 2024 through June 15, 2024 7.25% From June 16, 2024 through maturity 7.75% The Delayed Draw Term Loan is a non-interest bearing loan and, accordingly, was recorded at fair value as part of the Anthony’s acquisition which resulted in a debt discount of approximately $1.3 million, which is being amortized over the period of the Delayed Draw Term Loan. The Company recorded debt discount amortization of $0.1 million for each of the quarters ended April 1, 2024 and April 3, 2023, which is included within interest expense in the accompanying consolidated statements of operations. The Junior Indebtedness, which accrues interest at 4% per annum (i) is secured by a second lien on substantially all of the assets of the Company and the subsidiary guarantors (the “ Guarantors ”) pursuant to the terms and that certain Guaranty and Security Agreement, dated February 24, 2023, by and among the Guarantors and the Junior Lender, (ii) is subject to the terms of that certain Intercreditor and Subordination Agreement dated February 24, 2023, by and between the Administrative Agent and the Junior Lender and acknowledged by the borrowers and the Guarantors, and (iii) matures on the date that is the second anniversary of the maturity date under the Credit Agreement (the “ Junior Maturity Date ”) (September 30, 2027, based on the maturity date under the Credit Agreement of September 30, 2025). Under the terms of the Junior Indebtedness, no payments of cash interest or payments of principal shall be due until the Junior Maturity Date, and no voluntary prepayments may be made on the Junior Indebtedness prior to the Junior Maturity Date until after the repayment in full of the obligations under the Credit Agreement. The Company had $14.5 million recorded, net of unamortized discount under the Junior Indebtedness as of April 1, 2024 and January 1, 2024, respectively, included in Related party note payable in the accompanying consolidated balance sheets. The amendments to the Credit Agreement and the Delayed Draw Term Loan were accounted for as modifications of debt in the Company’s accompanying consolidated financial statements. For the quarter ended April 1, 2024 and April 3, 2023, interest expense consisted of: Quarter Ended (in thousands) April 1, 2024 April 3, 2023 Interest on credit agreement $ 483 $ 1,051 Interest on related party note 689 — Amortization of debt issuance costs 139 106 Amortization of related party note discount 38 39 Non-cash interest on redeemable preferred stock 1,106 1,022 Other interest expense (income) 22 (140) $ 2,477 $ 2,078 |
Income Taxes
Income Taxes | 3 Months Ended |
Apr. 01, 2024 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income TaxesFor each of the quarters ended April 1, 2024 and April 3, 2023, the Company's effective income tax rate was 0%. The difference from the U.S. corporate statutory federal income tax rate of 21%, is primarily the result of the valuation allowance applied to reduce the Company’s deferred tax assets to the amount that is more likely than not to be realized for each of the quarters ended April 1, 2024 and April 3, 2023, respectively. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Apr. 01, 2024 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders' Equity Common Stock The Company is authorized to issue 100,000,000 shares of common stock with a par value of $0.0001 per share. Holders of the Company’s common stock are entitled to one vote for each share. At April 1, 2024 and January 1, 2024, there were 27,042,213 shares and 26,832,691 shares of common stock outstanding, respectively. In addition to the CEO Awards, as defined below, as contemplated by the Bachmann Employment Agreement (as defined below) and as an inducement to employment, effective as of July 10, 2023, the Company issued the CEO 63,500 shares of the Company’s common stock, which such shares are subject to Rule 144 of the Securities Act of 1933, as amended. Preferred Stock The Company is authorized to issue 10,000,000 shares of preferred stock with a par value of $0.0001 per share with such designation, rights and preferences as may be determined from time to time by the Company’s Board of Directors. As of April 1, 2024 and January 1, 2024, there were 2,120,000 shares of preferred stock outstanding. On February 24, 2023, the Company filed an amended and restated certificate of designation, (the “ A&R CoD ”), which among other matters, added a provision providing that in the event the Company fails to timely redeem any shares of Series A Preferred Stock on November 3, 2027, the applicable dividend rate shall automatically increase to the lesser of (A) the sum of 10.0% plus the 2.0% applicable default rate (with such aggregate rate increasing by an additional 0.35% per quarter from and after November 3, 2027), or (B) the maximum rate that may be applied under applicable law, unless waived in writing by a majority of the outstanding shares of Series A Junior Preferred Stock. The A&R CoD also added a provision providing that in the event the Company fails to timely redeem any shares of Series A Junior Preferred Stock in connection with a Qualified Financing (as defined in the A&R CoD) on November 3, 2027 (a “Default”), the Company agrees to promptly commence a debt or equity financing transaction or sale process to solicit proposals for the sale of the Company and its subsidiaries (or, alternatively, the sale of material assets) designed to yield the maximum cash proceeds to the Company available for redemption of the Series A Junior Preferred Stock as promptly as practicable, but in any event, within 12 months from the date of the Default. If on or after November 3, 2026, the Company is aware that it is reasonably unlikely to have sufficient cash to timely effect the redemption in full of the Series A Junior Preferred Stock when first due, the Company shall, prior to such anticipated due date, take reasonable steps to engage an investment banking firm of national standing (and other appropriate professionals) to conduct preparatory work for such a financing transaction and sale process of the Company and its subsidiaries to provide for such transaction to occur as promptly as possible after any failure for a timely redemption of the Series A Junior Preferred Stock. The Series A Junior Preferred Stock ranks senior to the common stock and may be redeemed at the option of the Company at any time and must be redeemed by the Company in limited circumstances. The Series A Junior Preferred Stock shall not have voting rights or conversion rights. Interests in a Consolidated Joint Venture On February 29, 2024, the Company formed a joint venture with a third party for the development and operation of BurgerFi’s flagship corporate store in New York City, which opened during the quarter ended April 1, 2024. The Company holds an 80% interest in the joint venture and consolidates a $0.5 million 20% contribution to the joint venture from the non-controlling owner. Warrants and Options As of April 1, 2024, the Company had the following warrants and options outstanding: 15,063,800 warrants outstanding, each exercisable for one share of common stock at an exercise price of $11.50 including 11,468,800 in public warrants, 3,000,000 in Private Placement Warrants, 445,000 in Private Warrants (“private warrants”) and 150,000 in Working Capital Warrants. The public warrants expire in December 2025. Warrant Liability The Company has private warrants, which include provisions that affect the settlement amount. Such variables are outside of those used to determine the fair value of a fixed-for-fixed instrument, and as such, the warrants are accounted for as liabilities in accordance with ASC 815-40, Derivatives and Hedging , with changes in fair value included in the accompanying consolidated statements of operations. The warrant liability was $0.04 million and $0.2 million at April 1, 2024 and January 1, 2024, respectively. The change in fair value of warrant liabilities for the quarters ended April 1, 2024 and April 3, 2023 resulted in a gain of $0.1 million and a loss of $0.1 million, respectively, and is recognized in the accompanying consolidated statements of operations. The following is an analysis of changes in the warrant liability: (in thousands) Warrant liability at January 1, 2024 $ 182 Gain during the period (144) Warrant liability at April 1, 2024 $ 38 The fair value of the warrants are determined using the publicly-traded price of our common stock on the valuation dates of $0.5990 on April 1, 2024 and $0.86 on December 29, 2023, the last trading day before January 1, 2024. See Note 13, “Fair Value Measurements .” Share-Based Compensation The Company has the ability to grant stock options, stock appreciation rights, restricted stock, restricted stock units, other stock-based awards and performance compensation awards to current or prospective employees, directors, officers, consultants or advisors under the Company’s 2020 Omnibus Equity Incentive Plan (the “Plan” ). Accordingly, the Plan provides for the granting of Non-qualified Stock Options, Incentive Stock Options, RSU Awards, Restricted Stock Awards, Stock Appreciation Rights, Performance Stock Awards, Performance Unit Awards, Unrestricted Stock Awards, Distribution Equivalent Rights or any combination of the foregoing. As of April 1, 2024 and January 1, 2024, there were approxim ately 1,400,000 and 400,000 shares of common stock available for future grants under the Plan, respectively. The Company grants RSUs with service conditions, PSUs with performance and market conditions and unrestricted stock awards. RSUs granted with service conditions generally vest over 4 years. Performance conditions are based on key performance indicators, and market conditions include an index to the market value of the stock price of the Company. The fair value of the RSUs and PSUs granted is determined using the fair market value of the Company’s common stock on the date of grant, as set forth in the applicable Plan document. RSU and PSU Awards under the Plan The following table summarizes activity of RSUs and PSUs during the quarter ended April 1, 2024: Number of Restricted Stock Units Weighted Average Grant Date Fair Value Non-vested at January 1, 2024 1,162,550 $ 7.37 Granted 639,535 $ 0.81 Vested (225,925) $ 2.50 Forfeited (273,091) $ 4.48 Non-vested at April 1, 2024 1,303,069 $ 5.10 Share-based compensation expense recognized for awards under the Plan during the quarters and ended April 1, 2024 and April 3, 2023 was $0.8 million and $4.7 million, respectively. As of April 1, 2024, there was approximately $5.7 million of total unrecognized compensation cost related to unvested RSUs or PSUs under the Plan to be recognized over a weighted average period of 1.1 years. Restricted Stock Unit Awards - Inducement Awards On July 10, 2023, the Company issued awards of RSUs and PSUs to the Chief Executive Officer (“ CEO Awards ”) and the Chief Financial Officer (“ CFO Awards ”) as part of an inducement to enter into employment agreements with the Company (“ Inducement Awards ”). The Inducement Awards are not part of the Plan. Vesting for the Inducement Awards is over a five year period. Share based compensation expense related to the Inducement Awards recognized during the quarter ended April 1, 2024 was $0.2 million. As of April 1, 2024, there was approximately $1.8 million of total unrecognized compensation cost related to unvested Inducement Awards to be recognized over a weighted average period of 3.2 years. Terms of the Inducement Awards are as follows: • The CEO Awards are comprised of 500,000 time based RSUs which, subject to continuous employment, vest in equal tranches of 100,000 units per year, and 500,000 PSUs, which, subject to continuous employment and the achievement of certain performance criteria, vest in equal tranches of 100,000 units per year. • The CFO Awards are comprised of 200,000 time based RSUs which, subject to continuous employment, vest in equal tranches of 40,000 units per year, and 200,000 PSUs, which, subject to continuous employment and the achievement of certain performance criteria, vest in equal tranches of 40,000 units per year. Share-based compensation expense recognized for awards under the Plan and the Inducement Awards during the quarters ended April 1, 2024 and April 3, 2023 was $1.0 million and $4.7 million, respectively. As of April 1, 2024, there was approximately $7.5 million of total unrecognized compensation cost related to unvested RSUs or PSUs under the Plan and Inducement Awards to be recognized over a weighted average period of 2.1 years. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Apr. 01, 2024 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Fair values of financial instruments are estimated using public market prices, quotes from financial institutions, and other available information. The fair values of cash equivalents, receivables, net, accounts payable and short-term debt approximate their carrying amounts due to their short duration. The following tables summarize the fair values of financial instruments measured at fair value on a recurring basis as of April 1, 2024 and January 1, 2024. Items Measured at Fair Value at April 1, 2024 (in thousands) Quoted prices in active market for identical assets (liabilities) (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Warrant liability — $ 38 — Total $ — $ 38 $ — Items Measured at Fair Value at January 1, 2024 (in thousands) Quoted prices in active market for identical assets (liabilities) (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Warrant liability — $ 182 — Total $ — $ 182 $ — In estimating our fair value disclosures for financial instruments, we use the following methods and assumptions: The fair value of the Company’s warrant liability is measured at fair value on a recurring basis, classified as Level 2 in the fair value hierarchy. The fair value of the Private Placement Warrants, Private Warrants, and Working Capital Warrants are determined using the publicly-traded price of the Company’s common stock on the valuation dates of $0.5990 on April 1, 2024, and $0.86 on December 29, 2023, the last trading day before January 1, 2024. The fair value is calculated using the Black-Scholes option-pricing model. The Black-Scholes model requires us to make assumptions and judgments about the variables used in the calculation, including the expected term, expected volatility, risk-free interest rate, dividend rate and service period. The calculated warrant price for private warrants was $0.01 and $0.05 on April 1, 2024 and January 1, 2024, respectively. The input variables for the Black-Scholes are noted in the table below: April 1, 2024 January 1, 2024 Risk-free interest rate 4.75 % 4.25 % Expected life in years 1.7 2.0 Expected volatility 98.0 % 98.0 % Expected dividend yield — % — % Assets and liabilities that are measured at fair value on a non-recurring basis include our long-lived assets and definite-lived intangible assets which are adjusted to fair value upon impairment. In determining fair value, we used an income-based approach. As a number of assumptions and estimates were involved that are largely unobservable, they are classified as Level 3 inputs within the fair value hierarchy. Assumptions used in these forecasts are consistent with internal planning, and include revenue growth rates, royalties, gross margins, and operating expense in relation to the current economic environment and the Company’s future expectations. |
Segment Information
Segment Information | 3 Months Ended |
Apr. 01, 2024 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker (“CODM”), in deciding how to allocate resources and in assessing performance. The Company’s Chief Executive Officer is the CODM. The Company has two operating and reportable segments: BurgerFi and Anthony’s. BurgerFi . BurgerFi is a fast-casual “better burger” concept with franchised and corporate-owned restaurants as offering burgers, hot dogs, crispy chicken, frozen custard, hand-cut fries, shakes, beer, wine and more. Anthony’s . Anthony’s is a pizza and wing brand concept centered around a coal fired oven, and its menu offers “well-done” pizza, coal fired chicken wings, homemade meatballs, and a variety of handcrafted sandwiches and salads. The CODM measures segment income based on Adjusted EBITDA and believes that the adjusted measure provides a baseline for analyzing business trends. The Company defines Adjusted EBITDA as net loss before lease termination recovery, share-based compensation expense, depreciation and amortization expense, interest expense (which includes accretion on the value of preferred stock and interest accretion on the related party note), restructuring costs, merger, acquisition and integration costs, legal settlements, net, store closure costs, (gain) loss on change in value of warrant liability, pre-opening costs and (gain) loss on sale of assets. External sales are derived principally from food and beverage sales, royalty and franchise revenue. The Company does not rely on any major customers as a source of sales, and the customers and long-lived assets of our segments are predominantly in the U.S. There were no material transactions among the Company’s segments. The following table presents segment revenue and a reconciliation of adjusted EBITDA to net loss by segment: Quarter Ended Consolidated Anthony’s BurgerFi (in thousands) April 1, 2024 April 3, 2023 April 1, 2024 April 3, 2023 April 1, 2024 April 3, 2023 Revenue by Segment $ 42,879 $ 45,726 $ 32,393 $ 33,145 $ 10,486 $ 12,581 Adjusted EBITDA Reconciliation by Segment: Net (loss) income $ (6,538) $ (9,151) (691) $ 446 $ (5,847) $ (9,597) Lease termination recovery (56) — — — (56) — Share-based compensation expense 954 4,674 137 — 817 4,674 Depreciation and amortization expense 3,044 3,227 1,067 1,137 1,977 2,090 Interest expense 2,477 2,078 1,338 1,160 1,139 918 Restructuring costs 79 918 6 253 73 665 Merger, acquisition and integration costs 131 328 96 — 35 328 Legal settlements, net (284) 282 (325) — 41 282 Store closure costs 435 121 82 56 353 65 (Gain) loss on change in value of warrant liability (144) 73 — — (144) 73 Pre-opening costs 163 — — — 163 — (Gain) loss on disposal of assets (3) — — — (3) — Adjusted EBITDA $ 258 $ 2,550 $ 1,710 $ 3,052 $ (1,452) $ (502) |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Apr. 01, 2024 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles in the United States of America ( “GAAP” ) and the rules and regulations of the Securities and Exchange Commission ( “SEC” ) assuming the Company will continue as a going concern. T he going concern assumption contemplates the realization of assets and satisfaction of liabilities in the normal course of business. However, as discussed below and elsewhere through this Quarterly Report on Form 10-Q, substantial doubt about the Company’s ability to continue as a going concern existed as of April 1, 2024 as a result of non-compliance of the Company’s liquidity covenant within the Company’s Credit Agreement. Please see Part I, Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations, as well as Risk Factors in the Company’s Annual Report on Form 10-K for the year ended January 1, 2024 (the “ 2023 Form 10-K ”) and this Quarterly Report on Form 10-Q, for further information. The Company’s credit agreement (“Credit Agreement”) with a syndicate of banks has Term Loan and Revolving line of credit financing of approximately $51.3 million and $2.0 million, respectively, outstanding as of April 1, 2024, and expires on September 30, 2025. The Credit Agreement contains various covenants, including requirements for the Company to meet certain trailing twelve-month quarterly financial ratios and a minimum liquidity threshold. As of April 1, 2024, the Company was not in compliance with the minimum liquidity requirement of the Credit Agreement, which constitutes a breach of the Credit Agreement and an event of default. Accordingly, the outstanding balance of the Credit Agreement is included in short-term borrowings together with the short term portion of other notes payable an d outstanding balances under its finance leases on the accompanying consolidated balance sheets. This event of default entitles the lenders to call the debt sooner than its maturity date of September 30, 2025. The Company does not have and is not forecasted to have the readily available funds to repay the debt if called by the lenders. The Company has been actively engaged in discussions with its lenders to explore potential solutions regarding the default event and its resolution. We cannot, however, predict the results of any such negotiations. The consolidated financial statements do not include any adjustments to the carrying amounts and classification of assets, liabilities, and reported expenses that may be necessary if the Company were unable to continue as a going concern. From April 15, 2024 to April 17, 2024, the Company received notices from the syndicate of commercial bank lenders under the Credit Agreement that each lender’s respective (i) rights and obligations as a lender under the Credit Agreement and any other document or instruments delivered pursuant thereto to the extent related to the amount and percentage interest of the loans and commitments under the Credit Agreement held by such lender and (ii) to the extent permitted by applicable law, all claims, suits, causes of action and any other right of such lender against any person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing rights and obligations under the Credit Agreement were assigned to TREW Capital Management Private Credit 2 LLC (“ TREW ”). The foregoing assignments represented 100% of the amount of revolving loan commitments under the Credit Agreement and 100% of the amount of term loan under the Credit Agreement. The Company has initiated discussions with TREW with respect to potential solutions regarding the event of default described above. See Note 10, “ Debt ,” for additional disclosure surrounding the amended Credit Agreement. The accompanying condensed consolidated financial statements are unaudited and have been prepared in accordance with GAAP for interim financial information and with the instructions for Form 10-Q and Rule 8-03 of Regulation S-X. Pursuant to these rules and regulations, certain information and footnote disclosures normally included in the annual audited consolidated financial statements prepared in accordance with GAAP have been condensed or omitted. The accompanying condensed consolidated balance sheet as of January 1, 2024 is derived from the Company’s audited financial statements as of that date. Because certain information and footnote disclosures have been condensed or omitted, these condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto as of and for the year ended January 1, 2024 contained in the 2023 Form 10-K. In the opinion of management, all normal recurring adjustments necessary for a fair presentation have been included in the condensed consolidated financial statements. We are required to evaluate events occurring after April 1, 2024 for recognition and disclosure in the unaudited consolidated financial statements for the quarter ended April 1, 2024. Events are evaluated based on whether they represent information existing as of April 1, 2024, which require recognition, or new events occurring after April 1, 2024 which do not require recognition but require disclosure if the event is significant. We evaluated events occurring subsequent to April 1, 2024 through the date of issuance of these unaudited consolidated financial statements. |
Fiscal Period | 52-53-week fiscal year ending on the Monday nearest to December 31 of each year. Our first fiscal quarter of 2024 ended on April 1, 2024. Our current fiscal year will end on December 30, 2024. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements present the consolidated financial position, results from operations and cash flows of BurgerFi International, Inc., and its wholly owned subsidiaries. All material balances and transactions between the entities have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingencies at the date of the unaudited consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. |
New Accounting Pronouncements | New Accounting Pronouncements The Company reviewed all recently issued accounting pronouncements and concluded that they were not applicable or not expected to have a significant impact on the accompanying consolidated financial statements. |
Organization (Tables)
Organization (Tables) | 3 Months Ended |
Apr. 01, 2024 | |
Accounting Policies [Abstract] | |
Summary of Store Activity | Store activity for the quarter ended April 1, 2024 and the year ended January 1, 2024 is as follows: April 1, 2024 January 1, 2024 Corporate-owned Franchised Total Corporate-owned Franchised Total Total BurgerFi and Anthony's 86 76 162 87 81 168 BurgerFi stores, beginning of the period 28 80 108 25 89 114 BurgerFi stores opened 1 1 2 — 8 8 BurgerFi stores acquired / (transferred) — — — 4 (4) — BurgerFi stores closed (2) (6) (8) (1) (13) (14) BurgerFi total stores, end of the period 27 75 102 28 80 108 Anthony's stores, beginning of period 59 1 60 60 — 60 Anthony's stores opened — — — — 1 1 Anthony's stores closed — — — (1) — (1) Anthony's total stores, end of the period 59 1 60 59 1 60 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Apr. 01, 2024 | |
Accounting Policies [Abstract] | |
Restructuring and Related Costs | Restructuring costs for the periods shown consist of the following: Quarter Ended (in thousands) April 1, 2024 April 3, 2023 Expenses related to financing $ 73 $ 891 Severance and onboarding costs associated with change in CEO and CFO 6 27 Total $ 79 $ 918 |
Property & Equipment (Tables)
Property & Equipment (Tables) | 3 Months Ended |
Apr. 01, 2024 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property and Equipment | Property and equipment consisted of (in thousands) April 1, 2024 January 1, 2024 Leasehold improvements $ 18,373 $ 17,579 Kitchen equipment and other equipment 8,928 8,708 Computers and office equipment 1,586 1,536 Furniture and fixtures 2,868 2,828 Vehicles 9 8 31,764 30,659 Less: Accumulated depreciation and amortization (15,178) (14,538) Property and equipment – net $ 16,586 $ 16,121 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets, Net (Tables) | 3 Months Ended |
Apr. 01, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Components of Intangible Assets | The following is a summary of the components of intangible assets and the related amortization expense and impairment charges: April 1, 2024 (in thousands) Weighted Average Remaining Useful Life (years) Amount Accumulated Amortization Accumulated Impairment Charges Net Carrying Value Franchise agreements 3.7 $ 24,839 $ (11,680) $ — 13,159 BurgerFi trade names / trademarks 26.7 83,033 (9,111) — 73,922 Anthony's trade names / trademarks 27.6 60,690 (4,889) — 55,801 Other intangibles 6.7 9,018 (1,221) (7,706) 91 Subtotal 177,580 (26,901) (7,706) 142,973 Liquor licenses 5,930 — (113) 5,818 Total intangible assets, net $ 183,510 $ (26,901) $ (7,818) $ 148,791 January 1, 2024 (in thousands) Weighted Average Remaining Useful Life (years) Amount Accumulated Amortization Accumulated Impairment Charges Net Carrying Value Franchise agreements 4.0 $ 24,839 $ (10,793) $ — 14,046 BurgerFi trade names / trademarks 27.0 83,033 (8,419) — 74,614 Anthony's trade names / trademarks 27.8 60,690 (4,383) — 56,307 Other intangibles 7.0 9,018 (1,241) (7,706) 71 Subtotal 177,580 (24,836) (7,706) 145,038 Liquor licenses 5,930 — (113) 5,818 Total intangible assets, net $ 183,510 $ (24,836) $ (7,818) $ 150,856 |
Schedule of Goodwill | (in thousands) Anthony’s Segment BurgerFi Segment Total Balance as of January 2, 2023 Goodwill $ 80,684 123,981 $ 204,665 Accumulated impairment losses (49,064) (123,981) (173,045) Goodwill, net as of January 1, 2024 $ 31,621 $ — $ 31,621 Goodwill $ 80,684 $ 123,981 $ 204,665 Accumulated impairment losses (49,064) $ (123,981) (173,045) Goodwill, net as of April 1, 2024 $ 31,621 $ — $ 31,621 |
Contract Liabilities (Tables)
Contract Liabilities (Tables) | 3 Months Ended |
Apr. 01, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Contract with Customer, Contract Asset, Contract Liability, and Receivable | A roll forward of contract liabilities is as follows: Quarter Ended (in thousands) April 1, 2024 April 3, 2023 Balance, beginning of period $ 745 $ 1,092 Initial/Transfer franchise fees received — 156 Revenue recognized for stores open and transfers during period (4) (68) Revenue recognized related to franchise agreement terminations (56) (41) Other unearned revenue (recognized) received — (24) Balance, end of period $ 685 $ 1,115 Revenue recognized during the periods included in royalty and other fees on our consolidated statement of operations was as follows: Quarter Ended April 1, 2024 April 3, 2023 Franchise Fees $ 60 $ 133 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 3 Months Ended |
Apr. 01, 2024 | |
Earnings Per Share [Abstract] | |
Summary of Calculation of Basic and Diluted Income (Loss) Per Common Share | Basic and diluted net loss per common share is calculated as follows: (in thousands, except for per share data) Quarter Ended Numerator: April 1, 2024 April 3, 2023 Net loss available to common stockholders - diluted $ (6,538) $ (9,151) Denominator: Basic and diluted weighted-average shares outstanding 27,021,716 23,568,032 Basic and diluted net loss per common share $ (0.24) $ (0.39) |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Apr. 01, 2024 | |
Leases [Abstract] | |
Lease, Cost | The components of lease expense for the periods shown is as follows: Quarter Ended (in thousands) Classification April 1, 2024 April 3, 2023 Operating lease cost Occupancy and related expenses $ 3,271 $ 3,107 Pre-opening costs 77 — Store closure costs 115 — Lease termination recovery Asset impairment (56) $ — Finance lease cost: Amortization of right-of use assets Depreciation and amortization expense 88 58 Interest on lease liabilities Interest expense 45 14 Less: Sublease income Occupancy and related expenses (71) (47) Total lease cost $ 3,469 $ 3,132 |
Lessee, Operating Lease, Liability, Maturity | The maturity of the Company's operating and finance lease liabilities as of April 1, 2024 is as follows: (in thousands) Operating Leases Finance Leases 2024 $ 10,394 $ 410 2025 13,331 533 2026 11,672 504 2027 10,033 472 2028 8,397 448 2029 and thereafter 10,125 561 Total undiscounted lease payments 63,952 2,928 Less: present value adjustment (11,168) (736) Total net lease liabilities $ 52,784 $ 2,192 |
Finance Lease, Liability, Fiscal Year Maturity | The maturity of the Company's operating and finance lease liabilities as of April 1, 2024 is as follows: (in thousands) Operating Leases Finance Leases 2024 $ 10,394 $ 410 2025 13,331 533 2026 11,672 504 2027 10,033 472 2028 8,397 448 2029 and thereafter 10,125 561 Total undiscounted lease payments 63,952 2,928 Less: present value adjustment (11,168) (736) Total net lease liabilities $ 52,784 $ 2,192 |
Assets And Liabilities, Lessee | A summary of lease terms and discount rates for finance and operating leases is as follows: April 1, 2024 April 3, 2023 Weighted-average remaining lease term (in years) Operating leases 5.3 5.9 Finance leases 5.9 6.1 Weighted-average discount rate Operating leases 7.6 % 6.3 % Finance leases 10.5 % 6.0 % |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Apr. 01, 2024 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | (in thousands) April 1, 2024 January 1, 2024 Term loan $ 51,253 $ 51,253 Related party note payable 15,100 15,100 Revolving line of credit 2,000 2,000 Other notes payable 680 701 Finance lease liability 2,192 1,576 Total Debt $ 71,225 $ 70,630 Less: Unamortized debt discount related party note (574) (612) Less: Unamortized debt issuance costs (838) (978) Total Debt, net 69,813 69,040 Less: Short-term borrowing, including finance leases (53,064) (52,834) Total Long-term borrowings, including finance leases and related party note payable $ 16,749 $ 16,206 The Credit Agreement, including the term loan and revolving line of credit, is secured by substantially all of the Company’s assets and incurs interest on outstanding amounts at the following rates per annum through maturity: Time Period Interest Rate From January 1, 2024 through June 15, 2024 7.25% From June 16, 2024 through maturity 7.75% |
Schedule of Maturities of Long-term Debt | in thousands 2024 $ 53,253 2025 — 2026 — 2027 15,100 2028 — Total $ 68,353 |
Schedule of Interest Income and Interest Expense Disclosure | For the quarter ended April 1, 2024 and April 3, 2023, interest expense consisted of: Quarter Ended (in thousands) April 1, 2024 April 3, 2023 Interest on credit agreement $ 483 $ 1,051 Interest on related party note 689 — Amortization of debt issuance costs 139 106 Amortization of related party note discount 38 39 Non-cash interest on redeemable preferred stock 1,106 1,022 Other interest expense (income) 22 (140) $ 2,477 $ 2,078 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Apr. 01, 2024 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Stockholders' Equity Note, Warrants or Rights | The following is an analysis of changes in the warrant liability: (in thousands) Warrant liability at January 1, 2024 $ 182 Gain during the period (144) Warrant liability at April 1, 2024 $ 38 |
Summary of Activity of Restricted Stock Units | The following table summarizes activity of RSUs and PSUs during the quarter ended April 1, 2024: Number of Restricted Stock Units Weighted Average Grant Date Fair Value Non-vested at January 1, 2024 1,162,550 $ 7.37 Granted 639,535 $ 0.81 Vested (225,925) $ 2.50 Forfeited (273,091) $ 4.48 Non-vested at April 1, 2024 1,303,069 $ 5.10 The input variables for the Black-Scholes are noted in the table below: April 1, 2024 January 1, 2024 Risk-free interest rate 4.75 % 4.25 % Expected life in years 1.7 2.0 Expected volatility 98.0 % 98.0 % Expected dividend yield — % — % |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Apr. 01, 2024 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following tables summarize the fair values of financial instruments measured at fair value on a recurring basis as of April 1, 2024 and January 1, 2024. Items Measured at Fair Value at April 1, 2024 (in thousands) Quoted prices in active market for identical assets (liabilities) (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Warrant liability — $ 38 — Total $ — $ 38 $ — Items Measured at Fair Value at January 1, 2024 (in thousands) Quoted prices in active market for identical assets (liabilities) (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Warrant liability — $ 182 — Total $ — $ 182 $ — |
Input Variable for Black-Scholes Model | The following table summarizes activity of RSUs and PSUs during the quarter ended April 1, 2024: Number of Restricted Stock Units Weighted Average Grant Date Fair Value Non-vested at January 1, 2024 1,162,550 $ 7.37 Granted 639,535 $ 0.81 Vested (225,925) $ 2.50 Forfeited (273,091) $ 4.48 Non-vested at April 1, 2024 1,303,069 $ 5.10 The input variables for the Black-Scholes are noted in the table below: April 1, 2024 January 1, 2024 Risk-free interest rate 4.75 % 4.25 % Expected life in years 1.7 2.0 Expected volatility 98.0 % 98.0 % Expected dividend yield — % — % |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Apr. 01, 2024 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information | The following table presents segment revenue and a reconciliation of adjusted EBITDA to net loss by segment: Quarter Ended Consolidated Anthony’s BurgerFi (in thousands) April 1, 2024 April 3, 2023 April 1, 2024 April 3, 2023 April 1, 2024 April 3, 2023 Revenue by Segment $ 42,879 $ 45,726 $ 32,393 $ 33,145 $ 10,486 $ 12,581 Adjusted EBITDA Reconciliation by Segment: Net (loss) income $ (6,538) $ (9,151) (691) $ 446 $ (5,847) $ (9,597) Lease termination recovery (56) — — — (56) — Share-based compensation expense 954 4,674 137 — 817 4,674 Depreciation and amortization expense 3,044 3,227 1,067 1,137 1,977 2,090 Interest expense 2,477 2,078 1,338 1,160 1,139 918 Restructuring costs 79 918 6 253 73 665 Merger, acquisition and integration costs 131 328 96 — 35 328 Legal settlements, net (284) 282 (325) — 41 282 Store closure costs 435 121 82 56 353 65 (Gain) loss on change in value of warrant liability (144) 73 — — (144) 73 Pre-opening costs 163 — — — 163 — (Gain) loss on disposal of assets (3) — — — (3) — Adjusted EBITDA $ 258 $ 2,550 $ 1,710 $ 3,052 $ (1,452) $ (502) |
Organization - Narrative (Detai
Organization - Narrative (Details) | Apr. 01, 2024 store brand | Jan. 01, 2024 store | Jan. 02, 2023 store |
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | |||
Number of restaurants | 162 | 168 | |
Number of brands | brand | 2 | ||
Number of international stores | 1 | 1 | |
Corporate-owned | |||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | |||
Number of restaurants | 86 | 87 | |
Franchised | |||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | |||
Number of restaurants | 76 | 81 | |
BurgerFi | |||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | |||
Number of restaurants | 102 | 108 | 114 |
BurgerFi | Corporate-owned | |||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | |||
Number of restaurants | 27 | 28 | 25 |
BurgerFi | Franchised | |||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | |||
Number of restaurants | 75 | 80 | 89 |
Anthony's | |||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | |||
Number of restaurants | 60 | 60 | 60 |
Anthony's | Corporate-owned | |||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | |||
Number of restaurants | 59 | 59 | 60 |
Anthony's | Franchised | |||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | |||
Number of restaurants | 1 | 1 | 0 |
Organization - Summary of Store
Organization - Summary of Store Activity (Details) - store | 3 Months Ended | 12 Months Ended |
Apr. 01, 2024 | Jan. 01, 2024 | |
Store Activity [Roll Forward] | ||
Stores, beginning of year | 168 | |
Stores, end of year | 162 | 168 |
BurgerFi | ||
Store Activity [Roll Forward] | ||
Stores, beginning of year | 108 | 114 |
Number of stores opened | 2 | 8 |
Number of stores acquired or transferred | 0 | 0 |
Number of stores closed | (8) | (14) |
Stores, end of year | 102 | 108 |
Anthony's | ||
Store Activity [Roll Forward] | ||
Stores, beginning of year | 60 | 60 |
Number of stores opened | 0 | 1 |
Number of stores closed | 0 | (1) |
Stores, end of year | 60 | 60 |
Corporate-owned | ||
Store Activity [Roll Forward] | ||
Stores, beginning of year | 87 | |
Stores, end of year | 86 | 87 |
Corporate-owned | BurgerFi | ||
Store Activity [Roll Forward] | ||
Stores, beginning of year | 28 | 25 |
Number of stores opened | 1 | 0 |
Number of stores acquired or transferred | 0 | 4 |
Number of stores closed | (2) | (1) |
Stores, end of year | 27 | 28 |
Corporate-owned | Anthony's | ||
Store Activity [Roll Forward] | ||
Stores, beginning of year | 59 | 60 |
Number of stores opened | 0 | 0 |
Number of stores closed | 0 | (1) |
Stores, end of year | 59 | 59 |
Franchised | ||
Store Activity [Roll Forward] | ||
Stores, beginning of year | 81 | |
Stores, end of year | 76 | 81 |
Franchised | BurgerFi | ||
Store Activity [Roll Forward] | ||
Stores, beginning of year | 80 | 89 |
Number of stores opened | 1 | 8 |
Number of stores acquired or transferred | 0 | (4) |
Number of stores closed | (6) | (13) |
Stores, end of year | 75 | 80 |
Franchised | Anthony's | ||
Store Activity [Roll Forward] | ||
Stores, beginning of year | 1 | 0 |
Number of stores opened | 0 | 1 |
Number of stores closed | 0 | 0 |
Stores, end of year | 1 | 1 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Narrative (Details) - USD ($) $ in Thousands | 1 Months Ended | |||
Apr. 17, 2024 | Feb. 29, 2020 | Apr. 01, 2024 | Jan. 01, 2024 | |
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | ||||
Prepaid expenses | $ 2,200 | $ 1,300 | ||
Assets held for sale | 732 | 732 | ||
Gift card and gift certificate liabilities | 1,200 | 2,200 | ||
Customer loyalty program liability | 800 | 1,000 | ||
Term loan | ||||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | ||||
Financing outstanding | 51,253 | 51,253 | ||
Term loan | Subsequent Event | ||||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | ||||
Foregoing assignments percentage | 100% | |||
Revolving line of credit | ||||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | ||||
Financing outstanding | 2,000 | 2,000 | ||
Revolving line of credit | Subsequent Event | ||||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | ||||
Foregoing assignments percentage | 100% | |||
BF Dania Beach, LLC | ||||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | ||||
Cash deposits returned | $ 900 | |||
Assets held for sale | $ 700 | $ 700 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Restructuring (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 01, 2024 | Apr. 03, 2023 | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring costs | $ 79 | $ 918 |
Expenses related to financing | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring costs | 73 | 891 |
Severance and onboarding costs associated with change in CEO and CFO | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring costs | $ 6 | $ 27 |
Property & Equipment - Summary
Property & Equipment - Summary of Property and Equipment (Details) - USD ($) $ in Thousands | Apr. 01, 2024 | Jan. 01, 2024 |
Property Plant And Equipment [Line Items] | ||
Property and equipment - gross | $ 31,764 | $ 30,659 |
Less: Accumulated depreciation and amortization | (15,178) | (14,538) |
Property and equipment – net | 16,586 | 16,121 |
Leasehold improvements | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment - gross | 18,373 | 17,579 |
Kitchen equipment and other equipment | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment - gross | 8,928 | 8,708 |
Computers and office equipment | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment - gross | 1,586 | 1,536 |
Furniture and fixtures | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment - gross | 2,868 | 2,828 |
Vehicles | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment - gross | $ 9 | $ 8 |
Property & Equipment - Narrativ
Property & Equipment - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2024 | Apr. 03, 2023 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | $ 1 | $ 1.1 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets, Net - Summary of Components of Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Apr. 01, 2024 | Jan. 01, 2024 | |
Finite Lived Intangible Assets [Line Items] | ||
Amount | $ 177,580 | $ 177,580 |
Accumulated Amortization | (26,901) | (24,836) |
Accumulated Impairment Charges | (7,706) | (7,706) |
Net Carrying Value | 142,973 | 145,038 |
Total intangible assets, gross | 183,510 | 183,510 |
Total intangible assets, accumulated impairment | (7,818) | (7,818) |
Total intangible assets, net | $ 148,791 | $ 150,856 |
Franchise agreements | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life (years) | 3 years 8 months 12 days | 4 years |
Amount | $ 24,839 | $ 24,839 |
Accumulated Amortization | (11,680) | (10,793) |
Accumulated Impairment Charges | 0 | 0 |
Net Carrying Value | $ 13,159 | $ 14,046 |
Trade names/trademarks | BurgerFi | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life (years) | 26 years 8 months 12 days | 27 years |
Amount | $ 83,033 | $ 83,033 |
Accumulated Amortization | (9,111) | (8,419) |
Accumulated Impairment Charges | 0 | 0 |
Net Carrying Value | $ 73,922 | $ 74,614 |
Trade names/trademarks | Anthony's | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life (years) | 27 years 7 months 6 days | 27 years 9 months 18 days |
Amount | $ 60,690 | $ 60,690 |
Accumulated Amortization | (4,889) | (4,383) |
Accumulated Impairment Charges | 0 | 0 |
Net Carrying Value | $ 55,801 | $ 56,307 |
Other intangibles | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life (years) | 6 years 8 months 12 days | 7 years |
Amount | $ 9,018 | $ 9,018 |
Accumulated Amortization | (1,221) | (1,241) |
Accumulated Impairment Charges | (7,706) | (7,706) |
Net Carrying Value | 91 | 71 |
Liquor licenses | ||
Finite Lived Intangible Assets [Line Items] | ||
Liquor licenses, amount | 5,930 | 5,930 |
Liquor licenses, impairment charges | (113) | (113) |
Liquor licenses | $ 5,818 | $ 5,818 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets, Net - Goodwill Roll-forward (Details) - USD ($) $ in Thousands | Apr. 01, 2024 | Jan. 01, 2024 |
Goodwill [Line Items] | ||
Goodwill | $ 204,665 | $ 204,665 |
Accumulated impairment losses | (173,045) | (173,045) |
Goodwill, Total | 31,621 | 31,621 |
Anthony's | ||
Goodwill [Line Items] | ||
Goodwill | 80,684 | 80,684 |
Accumulated impairment losses | (49,064) | (49,064) |
Goodwill, Total | 31,621 | 31,621 |
BurgerFi | ||
Goodwill [Line Items] | ||
Goodwill | 123,981 | 123,981 |
Accumulated impairment losses | (123,981) | (123,981) |
Goodwill, Total | $ 0 | $ 0 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets, Net - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2024 | Apr. 03, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense | $ 2.1 | $ 2.1 |
Contract Liabilities - Analysis
Contract Liabilities - Analysis of Deferred Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 01, 2024 | Apr. 03, 2023 | |
Contract With Customer, Liability Activity [Roll Forward] | ||
Balance, beginning of period | $ 745 | $ 1,092 |
Initial/Transfer franchise fees received | 0 | 156 |
Revenue recognized for stores open and transfers during period | (4) | (68) |
Revenue recognized related to franchise agreement terminations | (56) | (41) |
Other unearned revenue (recognized) received | 0 | (24) |
Balance, end of period | $ 685 | $ 1,115 |
Contract Liabilities - Summary
Contract Liabilities - Summary of Franchise Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 01, 2024 | Apr. 03, 2023 | |
Franchise Fees | ||
Disaggregation Of Revenue [Line Items] | ||
Recognized revenue | $ 60 | $ 133 |
Net Loss Per Share - Narrative
Net Loss Per Share - Narrative (Details) | 3 Months Ended |
Apr. 01, 2024 shares | |
Public Warrants | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Antidilutive securities excluded from computation of earnings per share (in shares) | 15,063,800 |
Restricted Shares | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Antidilutive securities excluded from computation of earnings per share (in shares) | 2,423,069 |
Net Loss Per Share (Details)
Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Apr. 01, 2024 | Apr. 03, 2023 | |
Numerator: | ||
Net loss available to common stockholders - diluted | $ (6,538) | $ (9,151) |
Denominator: | ||
Basic weighted-average shares outstanding (in shares) | 27,021,716 | 23,568,032 |
Diluted weighted-average shares outstanding (in shares) | 27,021,716 | 23,568,032 |
Basic net loss per common share (in USD per share) | $ (0.24) | $ (0.39) |
Diluted net loss income per common share (in USD per share) | $ (0.24) | $ (0.39) |
Related Party Transactions (Det
Related Party Transactions (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||
Jun. 03, 2023 USD ($) $ / shares shares | Jan. 23, 2023 USD ($) store location shares | Apr. 01, 2024 USD ($) | Apr. 03, 2023 USD ($) | Jan. 01, 2024 store | Feb. 28, 2022 | |
Related Party Transaction [Line Items] | ||||||
Shares issued in private placement (in shares) | shares | 2,868,853 | |||||
Issuance price (in dollars per share) | $ / shares | $ 1.22 | |||||
Shares issued in private placement | $ 3,400 | |||||
Percentage of stock held by investor | 11% | |||||
Royalty and other fees | ||||||
Related Party Transaction [Line Items] | ||||||
Revenue not from contract with customer | $ 1,558 | $ 1,969 | ||||
Stores Acquired From Stockholder | ||||||
Related Party Transaction [Line Items] | ||||||
Due from the stockholder | location | 5 | |||||
Number of stores acquired or transferred | store | 2 | |||||
Number of entities acquired | store | 3 | |||||
Consideration paid | $ 900 | |||||
Cash | $ 500 | |||||
Shares issued to acquire business (in shares) | shares | 200,000 | |||||
Value of stock transferred | $ 400 | |||||
Fair value of net liabilities | $ 100 | |||||
Affiliated Entity | ||||||
Related Party Transaction [Line Items] | ||||||
Number of stores acquired or transferred | store | 4 | |||||
Affiliated Entity | Entity Under Common Ownership With Significant Shareholder | Leased Building Space Amendment | ||||||
Related Party Transaction [Line Items] | ||||||
Lease term | 10 years | |||||
Rent expense | 200 | $ 200 | ||||
Related Party | Royalty and other fees | ||||||
Related Party Transaction [Line Items] | ||||||
Revenue not from contract with customer | $ 100 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) $ in Millions | 18 Months Ended | ||||
Aug. 01, 2024 USD ($) | Apr. 28, 2024 USD ($) store | May 21, 2021 USD ($) | Aug. 26, 2022 USD ($) | Apr. 01, 2024 USD ($) | |
Commitments And Contingencies [Line Items] | |||||
Purchase obligation | $ 5.7 | ||||
Employee Retention Claims | |||||
Commitments And Contingencies [Line Items] | |||||
Estimate of possible loss | $ 0.5 | ||||
Pending Litigation | Lion Point Capital Allegation | |||||
Commitments And Contingencies [Line Items] | |||||
Loss contingency, damages sought | $ 26 | ||||
Pending Litigation | Burger Guys of Dania Pointe, et. al | |||||
Commitments And Contingencies [Line Items] | |||||
Loss contingency, damages sought | $ 2 | ||||
Pending Litigation | Burger Guys of Dania Pointe, et. al | Forecast | |||||
Commitments And Contingencies [Line Items] | |||||
Loss contingency, damages sought | $ 0.3 | ||||
Pending Litigation | Burger Guys of Dania Pointe, et. al | Purchase of Franchise Locations | Subsequent Event | |||||
Commitments And Contingencies [Line Items] | |||||
Loss contingency, damages sought | $ 2 | ||||
Number of franchise locations purchased | store | 2 | ||||
Pending Litigation | Burger Guys of Dania Pointe, et. al | Royalty Relief | Forecast | |||||
Commitments And Contingencies [Line Items] | |||||
Loss contingency, damages sought | $ 1.7 |
Leases - Lease Cost (Details)
Leases - Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 01, 2024 | Apr. 03, 2023 | |
Lessor, Lease, Description [Line Items] | ||
Lease termination recovery | $ (56) | $ 0 |
Finance lease cost: | ||
Amortization of right-of use assets | 88 | 58 |
Interest on lease liabilities | 45 | 14 |
Less: Sublease income | (71) | (47) |
Total lease cost | 3,469 | 3,132 |
Occupancy and related expenses | ||
Lessor, Lease, Description [Line Items] | ||
Operating lease cost | 3,271 | 3,107 |
Pre-opening costs | ||
Lessor, Lease, Description [Line Items] | ||
Operating lease cost | 77 | 0 |
Store closure costs | ||
Lessor, Lease, Description [Line Items] | ||
Operating lease cost | $ 115 | $ 0 |
Leases - Lease Maturities (Deta
Leases - Lease Maturities (Details) - USD ($) $ in Thousands | Apr. 01, 2024 | Jan. 01, 2024 |
Operating Leases | ||
2024 | $ 10,394 | |
2025 | 13,331 | |
2026 | 11,672 | |
2027 | 10,033 | |
2028 | 8,397 | |
2029 and thereafter | 10,125 | |
Total undiscounted lease payments | 63,952 | |
Less: present value adjustment | (11,168) | |
Total net lease liabilities | 52,784 | |
Finance Leases | ||
2024 | 410 | |
2025 | 533 | |
2026 | 504 | |
2027 | 472 | |
2028 | 448 | |
2029 and thereafter | 561 | |
Total undiscounted lease payments | 2,928 | |
Less: present value adjustment | (736) | |
Total net lease liabilities | $ 2,192 | $ 1,576 |
Leases - Lease Terms and Discou
Leases - Lease Terms and Discount Rates (Details) | Apr. 01, 2024 | Apr. 03, 2023 |
Weighted-average remaining lease term (in years) | ||
Operating leases | 5 years 3 months 18 days | 5 years 10 months 24 days |
Finance leases | 5 years 10 months 24 days | 6 years 1 month 6 days |
Weighted-average discount rate | ||
Operating leases | 7.60% | 6.30% |
Finance leases | 10.50% | 6% |
Debt - Schedule of Debt (Detail
Debt - Schedule of Debt (Details) - USD ($) $ in Thousands | Apr. 01, 2024 | Jan. 01, 2024 |
Debt Instrument [Line Items] | ||
Finance lease liability | $ 2,192 | $ 1,576 |
Total Debt | 71,225 | 70,630 |
Less: Unamortized debt discount related party note | (574) | (612) |
Less: Unamortized debt issuance costs | (838) | (978) |
Total Debt, net | 69,813 | 69,040 |
Less: Short-term borrowing, including finance leases | (53,064) | (52,834) |
Total Long-term borrowings, including finance leases and related party note payable | 16,749 | 16,206 |
Related Party | ||
Debt Instrument [Line Items] | ||
Total Long-term borrowings, including finance leases and related party note payable | 14,526 | 14,488 |
Nonrelated Party | ||
Debt Instrument [Line Items] | ||
Total Long-term borrowings, including finance leases and related party note payable | 2,223 | 1,718 |
Term loan | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 51,253 | 51,253 |
Notes Payable, Other Payables | Nonrelated Party | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 680 | 701 |
Notes Payable, Other Payables | Related party note payable | Related Party | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 15,100 | 15,100 |
Revolving line of credit | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 2,000 | $ 2,000 |
Debt - Narrative (Details)
Debt - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Feb. 24, 2023 | Apr. 01, 2024 | Apr. 03, 2023 | Jan. 01, 2024 | |
Debt Instrument [Line Items] | ||||
Unamortized debt discount | $ 574 | $ 612 | ||
Amortization of debt issuance costs | 139 | $ 106 | ||
Credit Agreement | Term loan | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, face amount | 57,800 | |||
Debt forgiven | $ 10,000 | |||
Credit Agreement | Revolving line of credit | ||||
Debt Instrument [Line Items] | ||||
Line of credit, maximum borrowing capacity | 4,000 | |||
Credit Agreement | Loans Payable, Noncurrent | ||||
Debt Instrument [Line Items] | ||||
Unamortized debt discount | 1,300 | 1,300 | ||
Amortization of debt issuance costs | 100 | $ 100 | ||
Credit Agreement | Loans Payable, Noncurrent | Related Party | ||||
Debt Instrument [Line Items] | ||||
Notes payable | 14,500 | $ 14,500 | ||
New Junior Subordinated Secured Notes | Junior Subordinated Debt | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, face amount | $ 5,100 | |||
Interest rate | 4% | |||
Related party note payable | ||||
Debt Instrument [Line Items] | ||||
Loans payable | $ 15,100 |
Debt - Repayment of Principal (
Debt - Repayment of Principal (Details) - Credit Agreement $ in Thousands | Apr. 01, 2024 USD ($) |
Maturities of Long-term Debt [Abstract] | |
2024 | $ 53,253 |
2025 | 0 |
2026 | 0 |
2027 | 15,100 |
2028 | 0 |
Total | $ 68,353 |
Debt Interest Incurred (Details
Debt Interest Incurred (Details) - Credit Agreement | Apr. 01, 2024 |
Interest Period One | |
Debt Instrument [Line Items] | |
Interest Rate | 7.25% |
Interest Period Two | |
Debt Instrument [Line Items] | |
Interest Rate | 7.75% |
Debt - Interest Expense (Detail
Debt - Interest Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 01, 2024 | Apr. 03, 2023 | |
Debt Instrument [Line Items] | ||
Amortization of debt issuance costs | $ 139 | $ 106 |
Amortization of related party note discount | 38 | 39 |
Non-cash interest on redeemable preferred stock | 1,106 | 1,022 |
Other interest expense (income) | 22 | (140) |
Interest expense | 2,477 | 2,078 |
Related Party | ||
Debt Instrument [Line Items] | ||
Interest on related party note | 689 | 0 |
Credit Agreement | ||
Debt Instrument [Line Items] | ||
Interest on credit agreement | $ 483 | $ 1,051 |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | |
Apr. 01, 2024 | Apr. 03, 2023 | |
Income Tax Disclosure [Abstract] | ||
Income tax rate | 0% | 0% |
Stockholders' Equity - Narrativ
Stockholders' Equity - Narrative (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | ||||||
Jul. 10, 2023 shares | Feb. 24, 2023 | Apr. 01, 2024 USD ($) $ / shares shares | Apr. 03, 2023 USD ($) | Feb. 29, 2024 | Jan. 01, 2024 USD ($) $ / shares shares | Dec. 29, 2023 $ / shares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 | |||||
Common stock, par value (in USD per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||||
Common stock, shares outstanding (in shares) | 27,042,213 | 26,832,691 | |||||
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 | |||||
Preferred stock, par value (in USD per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||||
Preferred stock, shares outstanding (in shares) | 2,120,000 | 2,120,000 | |||||
Dividend rate | 10% | ||||||
Preferred stock, default rate | 2% | ||||||
Preferred stock, default rate increase | 0.35% | ||||||
Issuance of shares in subsidiary | $ | $ 500 | ||||||
Warrants outstanding (in shares) | 15,063,800 | ||||||
Number of common stock called (in shares) | 1 | ||||||
Warrants exercise price | $ / shares | $ 11.50 | ||||||
Warrant liability | $ | $ 38 | $ 182 | |||||
Gain (loss) on change in fair value of warrant liability | $ | (144) | $ 73 | |||||
Share-based compensation expense | $ | $ 954 | 4,674 | |||||
Third Party | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Parent interest in joint venture | 80% | ||||||
Noncontrolling interest percent | 20% | ||||||
Measurement Input, Share Price | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Warrants, measurement input | $ / shares | 0.5990 | 0.86 | |||||
2020 Omnibus Equity Incentive Plan | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Common shares available for future grants (in shares) | 1,400,000 | 400,000 | |||||
Share-based compensation expense | $ | $ 800 | $ 4,700 | |||||
Inducement Awards Plan | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Vesting period | 5 years | ||||||
Share-based compensation expense | $ | $ 200 | ||||||
CEO Awards | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Number of shares purchased by CEO (in shares) | 63,500 | ||||||
Restricted Shares | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Vesting period | 4 years | ||||||
Restricted Stock Units (RSUs) | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Unrecognized compensation cost | $ | $ 7,500 | ||||||
Unrecognized stock-based compensation expense, weighted-average recognition period | 2 years 1 month 6 days | ||||||
Restricted Stock Units (RSUs) | 2020 Omnibus Equity Incentive Plan | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Unrecognized compensation cost | $ | $ 5,700 | ||||||
Unrecognized stock-based compensation expense, weighted-average recognition period | 1 year 1 month 6 days | ||||||
Restricted Stock Units (RSUs) | Inducement Awards Plan | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Unrecognized compensation cost | $ | $ 1,800 | ||||||
Unrecognized stock-based compensation expense, weighted-average recognition period | 3 years 2 months 12 days | ||||||
Restricted Stock Units (RSUs) | CEO Awards | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Common shares available for future grants (in shares) | 500,000 | ||||||
Shares expected to vest annually (in shares) | 100,000 | ||||||
Restricted Stock Units (RSUs) | CFO Awards | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Common shares available for future grants (in shares) | 200,000 | ||||||
Shares expected to vest annually (in shares) | 40,000 | ||||||
Performance Stock Units (PSUs) | CEO Awards | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Common shares available for future grants (in shares) | 500,000 | ||||||
Shares expected to vest annually (in shares) | 100,000 | ||||||
Performance Stock Units (PSUs) | CFO Awards | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Common shares available for future grants (in shares) | 200,000 | ||||||
Shares expected to vest annually (in shares) | 40,000 | ||||||
Public Warrants | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Warrants outstanding (in shares) | 11,468,800 | ||||||
Private Placement | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Warrants outstanding (in shares) | 3,000,000 | ||||||
Private Warrants | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Warrants outstanding (in shares) | 445,000 | ||||||
Warrants exercise price | $ / shares | $ 0.01 | $ 0.05 | |||||
Working Capital Warrants | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Warrants outstanding (in shares) | 150,000 |
Stockholders' Equity - Warrants
Stockholders' Equity - Warrants (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 01, 2024 | Apr. 03, 2023 | |
Warrant Liability [Roll Forward] | ||
Warrant liability at January 1, 2024 | $ 182 | |
(Gain) loss on change in value of warrant liability | (144) | $ 73 |
Warrant liability at April 1, 2024 | $ 38 |
Stockholders' Equity - Summary
Stockholders' Equity - Summary of Activity of Restricted Stock Units (Details) - Restricted Stock Units (RSUs) | 3 Months Ended |
Apr. 01, 2024 $ / shares shares | |
Number of Restricted Stock Units | |
Non-vested, beginning balance (in shares) | shares | 1,162,550 |
Granted (in shares) | shares | 639,535 |
Vested (in shares) | shares | (225,925) |
Forfeited (in shares) | shares | (273,091) |
Non-vested, ending balance (in shares) | shares | 1,303,069 |
Weighted Average Grant Date Fair Value | |
Non-vested, beginning balance (in USD per share) | $ / shares | $ 7.37 |
Granted (in USD per share) | $ / shares | 0.81 |
Vested (in USD per share) | $ / shares | 2.50 |
Forfeited (in USD per share) | $ / shares | 4.48 |
Non-vested, ending balance (in USD per share) | $ / shares | $ 5.10 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value by Hierarchy (Details) - USD ($) $ in Thousands | Apr. 01, 2024 | Jan. 01, 2024 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Warrant liability | $ 38 | $ 182 |
Quoted prices in active market for identical assets (liabilities) (Level 1) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Warrant liability | 0 | 0 |
Total | 0 | 0 |
Significant other observable inputs (Level 2) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total | 38 | 182 |
Significant unobservable inputs (Level 3) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Warrant liability | 0 | 0 |
Total | $ 0 | $ 0 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) | Apr. 01, 2024 $ / shares | Jan. 01, 2024 $ / shares | Dec. 29, 2023 $ / shares |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Warrants exercise price (in USD per share) | $ 11.50 | ||
Private Warrants | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Warrants exercise price (in USD per share) | $ 0.01 | $ 0.05 | |
Measurement Input, Share Price | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Warrants, measurement input | 0.5990 | 0.86 |
Fair Value Measurements - Black
Fair Value Measurements - Black Scholes Measurement Inputs (Details) | Apr. 01, 2024 yr | Jan. 01, 2024 yr |
Risk-free interest rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants, measurement input | 0.0475 | 0.0425 |
Expected life in years | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants, measurement input | 1.7 | 2 |
Expected volatility | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants, measurement input | 0.980 | 0.980 |
Expected dividend yield | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants, measurement input | 0 | 0 |
Segment Information - Narrative
Segment Information - Narrative (Details) | 3 Months Ended |
Apr. 01, 2024 Segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 2 |
Number of reportable segments | 2 |
Segment Information - Summary o
Segment Information - Summary of Financial Statement Data by Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 01, 2024 | Apr. 03, 2023 | |
Segment Reporting Information [Line Items] | ||
Revenue by Segment | $ 42,879 | $ 45,726 |
Net loss / Net (loss) income | (6,538) | (9,151) |
Lease termination recovery | (56) | 0 |
Depreciation and amortization expense | 3,044 | 3,227 |
Interest expense | 2,477 | 2,078 |
Restructuring costs | 79 | 918 |
Store closure costs | 435 | 121 |
(Gain) loss on change in value of warrant liability | (144) | 73 |
Pre-opening costs | 163 | 0 |
Consolidated | ||
Segment Reporting Information [Line Items] | ||
Revenue by Segment | 42,879 | 45,726 |
Net loss / Net (loss) income | (6,538) | (9,151) |
Lease termination recovery | (56) | 0 |
Share-based compensation expense | 954 | 4,674 |
Depreciation and amortization expense | 3,044 | 3,227 |
Interest expense | 2,477 | 2,078 |
Restructuring costs | 79 | 918 |
Merger, acquisition and integration costs | 131 | 328 |
Legal settlements, net | (284) | 282 |
Store closure costs | 435 | 121 |
(Gain) loss on change in value of warrant liability | (144) | 73 |
Pre-opening costs | 163 | 0 |
(Gain) loss on disposal of assets | (3) | 0 |
Adjusted EBITDA | 258 | 2,550 |
Anthony's | ||
Segment Reporting Information [Line Items] | ||
Revenue by Segment | 32,393 | 33,145 |
Net loss / Net (loss) income | (691) | 446 |
Lease termination recovery | 0 | 0 |
Share-based compensation expense | 137 | 0 |
Depreciation and amortization expense | 1,067 | 1,137 |
Interest expense | 1,338 | 1,160 |
Restructuring costs | 6 | 253 |
Merger, acquisition and integration costs | 96 | 0 |
Legal settlements, net | (325) | 0 |
Store closure costs | 82 | 56 |
(Gain) loss on change in value of warrant liability | 0 | 0 |
Pre-opening costs | 0 | 0 |
(Gain) loss on disposal of assets | 0 | 0 |
Adjusted EBITDA | 1,710 | 3,052 |
BurgerFi | ||
Segment Reporting Information [Line Items] | ||
Revenue by Segment | 10,486 | 12,581 |
Net loss / Net (loss) income | (5,847) | (9,597) |
Lease termination recovery | (56) | 0 |
Share-based compensation expense | 817 | 4,674 |
Depreciation and amortization expense | 1,977 | 2,090 |
Interest expense | 1,139 | 918 |
Restructuring costs | 73 | 665 |
Merger, acquisition and integration costs | 35 | 328 |
Legal settlements, net | 41 | 282 |
Store closure costs | 353 | 65 |
(Gain) loss on change in value of warrant liability | (144) | 73 |
Pre-opening costs | 163 | 0 |
(Gain) loss on disposal of assets | (3) | 0 |
Adjusted EBITDA | $ (1,452) | $ (502) |