DEL TACO RESTAURANTS, INC., 10-Q filed on 5/2/2016
Quarterly Report
Document and Entity Information
3 Months Ended
Mar. 22, 2016
Apr. 29, 2016
Document And Entity Information [Abstract]
 
 
Document Type
10-Q 
 
Amendment Flag
false 
 
Document Period End Date
Mar. 22, 2016 
 
Document Fiscal Year Focus
2016 
 
Document Fiscal Period Focus
Q1 
 
Trading Symbol
TACO 
 
Entity Registrant Name
Del Taco Restaurants, Inc. 
 
Entity Central Index Key
0001585583 
 
Current Fiscal Year End Date
--01-03 
 
Entity Filer Category
Accelerated Filer 
 
Entity Common Stock, Shares Outstanding
 
38,205,461 
Condensed Consolidated Balance Sheets (Successor [Member], USD $)
In Thousands, unless otherwise specified
Mar. 22, 2016
Dec. 29, 2015
Successor [Member]
 
 
Current assets:
 
 
Cash and cash equivalents
$ 13,404 
$ 10,194 
Accounts and other receivables, net
2,631 
3,220 
Inventories
2,526 
2,806 
Prepaid expenses and other current assets
2,519 
3,545 
Total current assets
21,080 
19,765 
Property and equipment, net
113,332 
114,030 
Goodwill
319,100 
318,275 
Trademarks
220,300 
220,300 
Intangible assets, net
27,481 
28,373 
Other assets, net
2,883 
2,829 
Total assets
704,158 
703,572 
Current liabilities:
 
 
Accounts payable
15,977 
16,831 
Other accrued liabilities
31,523 
32,897 
Current portion of capital lease obligations and deemed landlord financing liabilities
1,684 
1,725 
Total current liabilities
49,184 
51,453 
Long-term debt, capital lease obligations and deemed landlord financing liabilities, excluding current portion, net
167,677 
167,968 
Deferred income taxes
81,429 
79,523 
Other non-current liabilities
34,709 
36,251 
Total liabilities
332,999 
335,195 
Commitments and contingencies
   
   
Shareholders’ equity:
 
 
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; no shares issued and outstanding
0 
0 
Common stock, $0.0001 par value; 400,000,000 shares authorized; 38,715,746 shares issued and outstanding at March 22, 2016; 38,802,425 shares issued and outstanding at December 29, 2015
4 
4 
Additional paid-in capital
371,981 
372,260 
Accumulated deficit
(826)
(3,887)
Total shareholders’ equity
371,159 
368,377 
Total liabilities and shareholders’ equity
$ 704,158 
$ 703,572 
Condensed Consolidated Balance Sheets (Parenthetical) (Successor [Member], USD $)
Mar. 22, 2016
Dec. 29, 2015
Successor [Member]
 
 
Preferred stock, par value (in dollars per share)
$ 0.0001 
$ 0.0001 
Preferred stock, shares authorized (in shares)
1,000,000 
1,000,000 
Preferred stock, shares issued (in shares)
0 
0 
Preferred stock, shares outstanding (in shares)
0 
0 
Common stock, par value (in dollars per share)
$ 0.0001 
$ 0.0001 
Common stock, shares authorized (in shares)
400,000,000 
400,000,000 
Common stock, shares issued (in shares)
38,715,746 
38,802,425 
Common stock, shares outstanding (in shares)
38,715,746 
38,802,425 
Condensed Consolidated Statements of Comprehensive Income (Loss) (USD $)
3 Months Ended
Mar. 22, 2016
Successor [Member]
Mar. 24, 2015
Predecessor [Member]
Revenue:
 
 
Company restaurant sales
$ 93,550,000 
$ 90,883,000 
Franchise revenue
3,329,000 
3,001,000 
Franchise sublease income
524,000 
534,000 
Total revenue
97,403,000 
94,418,000 
Restaurant operating expenses:
 
 
Food and paper costs
26,129,000 
25,982,000 
Labor and related expenses
29,784,000 
27,923,000 
Occupancy and other operating expenses
20,123,000 
20,034,000 
General and administrative
8,292,000 
7,296,000 
Depreciation and amortization
5,486,000 
3,792,000 
Occupancy and other - franchise subleases
503,000 
505,000 
Pre-opening costs
93,000 
119,000 
Restaurant closure charges, net
178,000 
22,000 
Loss on disposal of assets
75,000 
0 
Total operating expenses
90,663,000 
85,673,000 
Income from operations
6,740,000 
8,745,000 
Other expenses:
 
 
Interest expense
1,472,000 
6,811,000 
Transaction-related costs
100,000 
6,316,000 
Debt modification costs
0 
135,000 
Change in fair value of warrant liability
0 
(35,000)
Total other expenses
1,537,000 
13,227,000 
Income (loss) from operations before provision for income taxes
5,203,000 
(4,482,000)
Provision for income taxes
2,100,000 
500,000 
Net income (loss)
3,061,000 
(4,940,000)
Other comprehensive income (loss):
 
 
Change in fair value of interest rate cap
0 
(21,000)
Reclassification of interest rate cap amortization included in net income (loss)
0 
22,000 
Total other comprehensive income, net
0 
1,000 
Comprehensive income (loss)
$ 3,061,000 
$ (4,939,000)
Earnings (loss) per share:
 
 
Basic (in dollars per share)
$ 0.08 
$ (1.21)
Diluted (in dollars per share)
$ 0.08 
$ (1.21)
Weighted-average shares outstanding
 
 
Basic (in shares)
38,798,014 
4,074,498 
Diluted (in shares)
38,798,301 
4,074,498 
Condensed Consolidated Statements of Cash Flows (USD $)
In Thousands, unless otherwise specified
3 Months Ended
Mar. 22, 2016
Successor [Member]
Mar. 24, 2015
Predecessor [Member]
Operating activities
 
 
Net income (loss)
$ 3,061 
$ (4,940)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
 
 
Depreciation and amortization
5,486 
3,793 
Amortization of favorable and unfavorable lease assets and liabilities, net
(140)
(1)
Amortization of deferred financing costs
89 
371 
Subordinated note interest paid-in-kind
0 
37 
Debt modification costs
0 
135 
Stock-based compensation
699 
532 
Change in fair value of warrant liability
0 
(35)
Deferred income taxes
1,100 
0 
Loss on disposal of assets
75 
0 
Charges for accretion in current period
124 
0 
Changes in operating assets and liabilities:
 
 
Accounts and other receivables, net
589 
608 
Inventories
280 
97 
Prepaid expenses and other current assets
1,026 
1,161 
Accounts payable
(854)
2,114 
Other accrued liabilities
(1,372)
(3,069)
Other non-current liabilities
(937)
(1,554)
Net cash provided by (used in) operating activities
9,226 
(751)
Investing activities
 
 
Purchases of property and equipment
(4,357)
(5,333)
Proceeds from disposal of property and equipment
7 
0 
Purchases of other assets
(267)
(209)
Net cash used in investing activities
(4,617)
(5,542)
Financing activities
 
 
Proceeds from term loan, net of debt discount
0 
23,654 
Proceeds from issuance of common stock
0 
91,236 
Repurchase of common stock
(978)
0 
Payment of tax withholding related to option exercises and distribution of restricted stock units
0 
(7,533)
Payments on capital leases and deemed landlord financing
(421)
(384)
Payment on subordinated notes
0 
(108,113)
Proceeds from revolving credit facility, net of debt discount
0 
10,000 
Payments for debt issue costs
0 
(589)
Net cash (used in) provided by financing activities
(1,399)
8,271 
Increase in cash and cash equivalents
3,210 
1,978 
Cash and cash equivalents at beginning of period
10,194 
8,553 
Cash and cash equivalents at end of period
13,404 
10,531 
Supplemental cash flow information:
 
 
Cash paid during the period for interest
1,505 
6,190 
Cash paid (received) during the period for income taxes
5 
(2)
Supplemental schedule of non-cash activities:
 
 
Accrued property and equipment purchases
1,961 
1,439 
Write-offs of accounts receivables
72 
0 
Amortization of interest rate cap into net loss, net of tax
0 
22 
Change in other asset for fair value of interest rate cap recorded to other comprehensive loss, net
0 
(21)
Warrant liability reclassified to equity upon exercise of warrants
$ 0 
$ 8,274 
Description of Business
Description of Business
Description of Business
Del Taco Restaurants, Inc. (f/k/a Levy Acquisition Corp. (“LAC”)) is a Delaware corporation headquartered in Lake Forest, California. The consolidated financial statements include the accounts of Del Taco Restaurants, Inc. and its wholly owned subsidiaries (collectively, the “Company” or “Del Taco”). The Company develops, franchises, owns, and operates Del Taco quick-service Mexican-American restaurants. At March 22, 2016 (Successor), there were 297 company-operated and 246 franchised Del Taco restaurants located in 17 states, including one franchised unit in Guam. At March 24, 2015 (Predecessor), there were 304 company-operated and 242 franchised Del Taco restaurants located in 16 states, including one franchised unit in Guam.
The Company was originally incorporated in Delaware on August 2, 2013 as a special purpose acquisition company, formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or other similar business combination with one or more businesses. On June 30, 2015 (the “Closing Date”), the Company consummated its business combination with Del Taco Holdings, Inc. (“DTH”) pursuant to the agreement and plan of merger dated as of March 12, 2015 by and among LAC, Levy Merger Sub, LLC (“Levy Merger Sub”), LAC’s wholly owned subsidiary, and DTH (the “Merger Agreement”). Under the Merger Agreement, Levy Merger Sub merged with and into DTH, with DTH surviving the merger as a wholly-owned subsidiary of the Company (the “Business Combination” or “Merger”). In connection with the closing of the Business Combination, the Company changed its name from Levy Acquisition Corp. to Del Taco Restaurants, Inc. See Note 3 for further discussion of the Business Combination.
Basis of Presentation and Summary of Significant Accounting Policies
Basis of Presentation and Summary of Significant Accounting Policies
Basis of Presentation and Summary of Significant Accounting Policies
Basis of Presentation
The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and the rules and regulations of Securities and Exchange Commission (“SEC”). For additional information, these consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 29, 2015 ("2015 Form 10-K"). The accounting policies used in preparing these consolidated financial statements are the same as those described in our 2015 Form 10-K.
As a result of the Business Combination, the Company is the acquirer for accounting purposes, and DTH is the acquiree and accounting predecessor. The Company’s financial statement presentation distinguishes a “Predecessor” for DTH for periods prior to the Closing Date. The Company is the “Successor” for periods after the Closing Date, which includes consolidation of DTH subsequent to the Business Combination on June 30, 2015. The Merger was accounted for as a business combination using the acquisition method of accounting, and the Successor financial statements reflect a new basis of accounting that is based on the fair value of the net assets acquired. See Note 3 for further discussion of the Business Combination. As a result of the application of the acquisition method of accounting as of the Closing Date, the financial statements for the Predecessor period and for the Successor period are presented on a different basis and are therefore, not comparable. The historical financial information of Del Taco, formerly LAC, prior to the Business Combination have not been reflected in the financial statements as those amounts have been considered de-minimus.
 
The Company’s fiscal year ends on the Tuesday closest to December 31. Fiscal year 2016 is the fifty-three week period ended January 3, 2017 (Successor). Fiscal year 2015 is the fifty-two week period ended December 29, 2015 (Successor). In a fifty-three week fiscal year, the first, second and third quarters each include twelve weeks of operations and the fourth quarter includes seventeen weeks of operations. In a fifty-two week fiscal year, the first, second and third quarters each include twelve weeks of operations and the fourth quarter includes sixteen weeks of operations. For fiscal year 2016, the Company’s accompanying financial statements reflect the twelve weeks ended March 22, 2016 (Successor). For fiscal year 2015, the Company’s accompanying financial statements reflect the twelve weeks ended March 24, 2015 (Predecessor).
In the opinion of management, the accompanying consolidated financial statements reflect all adjustments which are necessary for a fair presentation of the consolidated financial position, results of operations and cash flows for the periods presented. The results of operations for such interim periods are not necessarily indicative of results of operations to be expected for the full fiscal year.
Principles of Consolidation
The accompanying consolidated financial statements include the accounts of the Company and its wholly and majority owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.
Use of Estimates
The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Management believes that such estimates have been based on reasonable and supportable assumptions and the resulting estimates are reasonable for use in the preparation of the consolidated financial statements. Actual results could differ from these estimates. The Company’s significant estimates include estimates for impairment of goodwill, intangible assets and property and equipment, valuations provided in business combinations, insurance reserves, restaurant closure reserves, stock-based compensation, contingent liabilities, certain leasing activities and income tax valuation allowances.
Recently Issued Accounting Standards
In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which provides a comprehensive new revenue recognition model that requires a company to recognize revenue in an amount that reflects the consideration it expects to receive for the transfer of promised goods or services to its customers. The standard also requires additional disclosure regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. This ASU is effective for annual periods and interim periods beginning after December 15, 2017. The ASU is to be applied retrospectively or using a cumulative effect transition method. The Company is currently evaluating which transition method to use and the effect that this pronouncement will have on its consolidated financial statements and related disclosures.
Business Combination
Business Combination
Business Combination
On June 30, 2015, the Company and DTH completed the Business Combination pursuant to the Merger Agreement under which the Company’s wholly-owned subsidiary, Levy Merger Sub, merged with and into DTH, with DTH surviving the merger as a wholly-owned subsidiary of the Company.
Concurrent with the execution of the Merger Agreement, Levy Epic Acquisition Company, LLC (“Levy Newco”), Levy Epic Acquisition Company II, LLC (“Levy Newco II” and with Levy Newco, the “Levy Newco Parties”), DTH and the DTH stockholders entered into a stock purchase agreement (the “Stock Purchase Agreement”). Pursuant to the Stock Purchase Agreement, the Levy Newco Parties agreed to purchase 2,348,968 shares of DTH common stock from DTH for $91.2 million in cash, and to purchase 740,564 shares of DTH common stock directly from existing DTH shareholders for $28.8 million in cash (the “Initial Investment”). As a result of this Initial Investment, an aggregate of 3,089,532 shares of DTH common stock was purchased by the Levy Newco Parties for total cash consideration of $120.0 million.
The total purchase price paid to DTH stockholders (except for the Levy NewCo Parties) was $284.3 million. The closing of the Business Combination and the Initial Investment were accounted for as related events transferring control of DTH to the Company through a minority investment in the Initial Investment and a controlling interest at the closing of the Business Combination.
The Company recorded a preliminary allocation of the purchase price to DTH’s tangible and identifiable intangible assets acquired and liabilities assumed based on their fair value as of the Closing Date. This allocation is subject to revision as the estimates of taxes are based on preliminary information and are subject to refinement. The preliminary purchase price allocation is as follows (in thousands):
 
 
Preliminary
Purchase Price
Allocation
Cash and cash equivalents
$
5,173

Accounts receivable and other receivables
3,228

Inventories
2,541

Prepaid expenses and other current assets
4,266

Total current assets
15,208

Property and equipment
105,524

Intangible assets
250,490

Other assets
4,194

Total identifiable assets acquired
375,416

Accounts payable
(18,866
)
Other accrued liabilities
(26,607
)
Current portion of capital lease obligations and deemed landlord financing liabilities
(1,670
)
Long-term debt, capital lease obligations and deemed landlord financing liabilities
(246,562
)
Deferred income taxes
(80,280
)
Other long-term liabilities
(36,208
)
Net identifiable liabilities assumed
(34,777
)
Goodwill
319,082

Total gross consideration
$
284,305



During the twelve weeks ended March 22, 2016 (Successor), the Company recorded a net $0.8 million adjustment to goodwill due to a change in estimate for the liability for deferred income taxes.
For the twelve weeks ended March 22, 2016 (Successor) and the twelve weeks ended March 24, 2015 (Predecessor), the Company incurred approximately $0.1 million and $6.3 million, respectively, of transaction expenses directly related to the Business Combination.
Restaurant Closure Charges, Net
Restaurant Closure Charges, Net
Restaurant Closure Charges, Net
At March 22, 2016 (Successor) and December 29, 2015 (Successor), the restaurant closure liability is $4.2 million and $4.8 million, respectively. The details of the restaurant closure activities are discussed below.
Restaurant Closures and Lease Reserves
The following table represents other restaurant closure liability activity related to prior restaurant closures and sublease income shortfalls (in thousands):
 
 
Total
Balance at December 29, 2015 (Successor)
 
$
1,023

Charges for accretion in current period
 
19

Cash payments
 
(15
)
Balance at March 22, 2016 (Successor)
 
$
1,027


The current portion of the restaurant closure liability is $0.1 million at both March 22, 2016 (Successor) and December 29, 2015 (Successor), respectively, and is included in other accrued liabilities in the consolidated balance sheets. The non-current portion of the restaurant closure liability is $0.9 million at both March 22, 2016 (Successor) and December 29, 2015 (Successor), respectively, and is included in other non-current liabilities in the consolidated balance sheets.
Restaurant Closure and Other Related Charges for 12 Underperforming Restaurants
During the fourth fiscal quarter of 2015, the Company closed 12 company-operated restaurants. During the twelve weeks ended March 22, 2016 (Successor), the Company recorded accretion expense related to the closures as well as $0.1 million related to the write-off of fixed assets associated with the closures.
A summary of the restaurant closure liability activity for these 12 closed restaurants consisted of the following (in thousands):
 
 
Contract termination costs
 
Other associated costs
 
Total
Balance at December 29, 2015 (Successor)
 
$
3,637

 
$
163

 
$
3,800

Charges for accretion in current period
 
35

 
—

 
35

Cash payments
 
(484
)
 
(129
)
 
(613
)
Balance at March 22, 2016 (Successor)
 
$
3,188

 
$
34

 
$
3,222


The current portion of the restaurant closure liability is $1.5 million at both March 22, 2016 (Successor) and December 29, 2015 (Successor), respectively, and is included in other accrued liabilities in the consolidated balance sheets. The non-current portion of the restaurant closure liability is $1.7 million and $2.3 million at March 22, 2016 (Successor) and December 29, 2015 (Successor), respectively, and is included in other non-current liabilities in the consolidated balance sheets.
Goodwill and other Intangible Assets
Goodwill and other Intangible Assets
Goodwill and other Intangible Assets
Goodwill was $319.1 million at March 22, 2016 (Successor) compared to $318.3 million at December 29, 2015 (Successor). The increase was due to an adjustment to the preliminary purchase price allocation as described in more detail in Note 3.
There have been no changes in the carrying amount of trademarks since December 29, 2015 (Successor).
The Company’s other intangible assets at March 22, 2016 (Successor) and December 29, 2015 (Successor) consisted of the following (in thousands):
 
 
Successor
 
 
March 22, 2016
 
December 29, 2015
 
 
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Net
 
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Net
Favorable lease assets
 
$
14,207

 
$
(1,483
)
 
$
12,724

 
$
14,207

 
$
(1,020
)
 
$
13,187

Franchise rights
 
15,789

 
(1,032
)
 
14,757

 
15,897

 
(711
)
 
15,186

Total amortized other intangible assets
 
$
29,996

 
$
(2,515
)
 
$
27,481

 
$
30,104

 
$
(1,731
)
 
$
28,373



Goodwill and intangible assets at March 22, 2016 (Successor) and December 29, 2015 (Successor) are based on the preliminary purchase price allocation of DTH, which is based on preliminary valuations performed to determine the fair value of the acquired assets as of the acquisition date. See Note 3 for further discussion of the acquisition of DTH. Two franchise locations closed during the first fiscal quarter of 2016 and accordingly, the Company wrote-off $0.1 million of franchise rights during the twelve weeks ended March 22, 2016 (Successor).
Debt, Obligations Under Capital Leases and Deemed Landlord Financing Liabilities
Debt, Obligations Under Capital Leases and Deemed Landlord Financing Liabilities
Debt, Obligations Under Capital Leases and Deemed Landlord Financing Liabilities
The Company’s long-term debt, capital lease obligations and deemed landlord financing liabilities at March 22, 2016 (Successor) and December 29, 2015 (Successor) consisted of the following (in thousands):
 
 
 
Successor
 
 
March 22, 2016
 
December 29, 2015
2015 Senior Credit Facility, net of debt discount of $1,261 and $1,328 and deferred financing costs of $426 and $448 at March 22, 2016 (Successor) and December 29, 2015 (Successor), respectively
 
$
152,313

 
$
152,224

Total outstanding indebtedness
 
152,313

 
152,224

Obligations under capital leases and deemed landlord financing liabilities
 
17,048

 
17,469

Total debt
 
169,361

 
169,693

Less: amounts due within one year
 
1,684

 
1,725

Total amounts due after one year, net
 
$
167,677

 
$
167,968

 
At March 22, 2016 (Successor) and December 29, 2015 (Successor), the Company assessed the amounts recorded under the 2015 Senior Credit Facility and determined that such amounts approximated fair value.
2015 Revolving Credit Facility (Successor)
On August 4, 2015, the Company refinanced its existing senior credit facility (“2013 Senior Credit Facility”) and entered into a new credit agreement (the “Credit Agreement”). The Credit Agreement, which matures on August 4, 2020, provides for a $250 million revolving credit facility (the “2015 Senior Credit Facility”). The Company utilized $164 million of proceeds from the Credit Agreement to refinance in total its 2013 Senior Credit Facility and pay costs associated with the refinancing. The 2013 Senior Credit Facility, as amended March 20, 2015, totaled $267.1 million, consisting of an initial $227.1 million term loan (“2013 Term Loan”) and a $40 million revolver (“2013 Revolver”). At the time of the refinance, a $162.5 million term loan balance was outstanding and $17.6 million of revolver capacity was utilized to support outstanding letters of credit under the 2013 Senior Credit Facility.
At the Company’s option, loans under the 2015 Senior Credit Facility may bear interest at a base rate or LIBOR, plus an applicable margin determined in accordance with a consolidated total lease adjusted leverage ratio-based pricing grid. The base rate is calculated as the highest of (a) the Federal Funds Rate plus 1/2 of 1%, (b) the prime rate of Bank of America, and (c) LIBOR plus 1.00%. For LIBOR loans, the applicable margin is in the range of 1.50% to 2.50%, and for base rate loans the applicable margin is in the range of 0.50% and 1.50%. The applicable margin was initially set at 2.00% for LIBOR loans and at 1.00% for base rate loans until delivery of financial statements and a compliance certificate for the fourth fiscal quarter ending after the closing date of the Credit Agreement. Following delivery of financial statements and a compliance certificate for the fourth fiscal quarter ending December 29, 2015 (Successor), the applicable margin decreased 0.25% for both LIBOR loans and base rate loans during the first fiscal quarter of 2016. The 2015 Senior Credit Facility capacity used to support letters of credit currently incurs fees equal to the applicable margin of 1.75%. The 2015 Senior Credit Facility unused commitment currently incurs a 0.20% fee.

The Credit Agreement contains certain financial covenants, including the maintenance of a consolidated total lease adjusted leverage ratio and a consolidated fixed charge coverage ratio. The Company was in compliance with the financial covenants as of March 22, 2016 (Successor). Substantially all of the assets of the Company are pledged as collateral under the 2015 Senior Credit Facility.
The Company capitalized lender costs and deferred financing costs of $1.4 million and $0.5 million, respectively, in connection with the refinancing. Lender debt discount costs and deferred financing costs associated with the 2015 Senior Credit Facility are presented net of the 2015 Senior Credit Facility balance on the consolidated balance sheets and will be amortized to interest expense over the term of the 2015 Senior Credit Facility. Amortization of deferred financing costs and debt discount related to the 2015 Senior Credit Facility totaled $0.1 million during the twelve weeks ended March 22, 2016 (Successor).
At March 22, 2016 (Successor), the weighted-average interest rate on the outstanding balance of the Senior Credit Facility was 2.2%. At March 22, 2016 (Successor), the Company had a total of $77.0 million of availability for additional borrowings under the 2015 Senior Credit Facility as the Company had $154.0 million of outstanding borrowings and letters of credit outstanding of $19.0 million which reduce availability under the 2015 Senior Credit Facility.
DTH 2013 Senior Credit Facility
In March 2015, DTH amended its 2013 Senior Credit Facility to increase the 2013 Term Loan by $25.1 million to $227.1 million (the “March 2015 Debt Refinance”). A portion of the proceeds from Step 1 of the Business Combination, described in Note 3, proceeds of $10 million from the 2013 Revolver and the March 2015 Debt Refinance proceeds were used to fully redeem the then outstanding balance of the subordinated notes of $111.2 million.
On March 12, 2015, DTH satisfied the rating condition in its 2013 Senior Credit Facility resulting in a decrease in interest rate to LIBOR (not to be less than 1.00%) plus a margin of 4.25%.
The Company incurred lender costs and third-party costs associated with the March 2015 Debt Refinance of $1.6 million of which $1.5 million was capitalized as lender debt discount and $0.1 million was expensed as debt modification costs in the consolidated statements of comprehensive income (loss) for the twelve weeks ended March 24, 2015 (Predecessor).
Lender debt discount costs and deferred financing costs associated with the 2013 Senior Credit Facility were amortized to interest expense over the term of the 2013 Term Loan using the effective interest method. Amortization of deferred financing costs including debt discount totaled $0.4 million during the twelve weeks ended March 24, 2015 (Predecessor).
Subordinated Notes (Predecessor)
In connection with Step 1 of the Business Combination and the March 2015 Debt Refinance discussed above, DTH fully redeemed the outstanding balance of the Sagittarius Restaurants LLC (SAG Restaurants) subordinated notes (“SAG Restaurants Sub Notes”) and F&C Restaurant Holding Co. (F&C RHC) subordinated notes (“F&C RHC Sub Notes”) on March 20, 2015 of $111.2 million.
For the twelve weeks ended March 24, 2015 (Predecessor), interest expense related to the SAG Restaurants Sub Notes and F&C RHC Sub Notes was $3.1 million.
Derivative Instruments
Derivative Instruments
Derivative Instruments
As of March 22, 2016 (Successor) and December 29, 2015 (Successor), the Company had an interest rate cap agreement to hedge cash flows associated with interest rate fluctuations on variable rate debt. This agreement had a notional amount of $87.5 million as of March 22, 2016 (Successor) and December 29, 2015 (Successor). The individual caplet contracts within the remaining interest rate cap agreement expire at various dates through June 30, 2016.
Interest Rate Cap Agreement
To ensure the effectiveness of the interest rate cap agreement through June 30, 2015 (Predecessor) , the Company elected the three-month LIBOR rate option for its variable rate interest payments on term balances equal to or in excess of the applicable notional amount of the interest rate cap agreement as of each reset date. The reset dates and other critical terms on the term loans perfectly match with the interest rate cap reset dates and other critical terms during the twelve weeks ended March 24, 2015 (Predecessor).
As of the July 1, 2015 interest reset date, the Company elected the one-month LIBOR rate option for its variable rate interest payments on term balances equal to or in excess of the applicable notional amount of the interest rate cap agreement, and as a result, this hedge became ineffective. Therefore, after July 1, 2015, any changes in fair value will be recorded through interest expense. For the twelve weeks ended March 22, 2016 (Successor), there have been no changes in the fair value of the interest rate cap agreement.
The effective portion of the interest rate cap agreement through June 30, 2015 (Predecessor) was included in accumulated other comprehensive income and included as a fair value adjustment through the purchase price allocation as described in Note 3.

Warrant Liability (Predecessor)
On March 20, 2015, warrants to purchase 597,802 shares of DTH common stock held by a former large shareholder of DTH were exercised at a strike price of $25.00 per share based on a fair value of $8.3 million determined based on the common stock price of the Initial Investment discussed above in Note 3. Upon exercise, 384,777 shares of DTH common stock were redeemed as payment for the strike price resulting in 213,025 shares of DTH common stock being issued. DTH recorded a mark-to-market adjustment of $35,000 to reduce the liability during the twelve weeks ended March 24, 2015 (Predecessor) and then reclassified the balance of the warrant liability of $8.3 million to shareholders’ equity.
Fair Value Measurements
Fair Value Measurements
Fair Value Measurements
The fair values of cash and cash equivalents, accounts receivable, accounts payable and other accrued liabilities approximate their carrying amounts due to their short maturities. The carrying value of the 2015 Senior Credit Facility approximated fair value. The interest rate cap agreement is recorded at fair value in the Company’s consolidated balance sheets.
As of March 22, 2016 (Successor) and December 29, 2015 (Successor), the Company held certain assets and liabilities that are required to be measured at fair value on a recurring basis. For both periods, these included derivative instruments related to interest rates. The Company determined the fair values of the interest rate cap contracts based on counterparty quotes, with appropriate adjustments for any significant impact of nonperformance risk of the parties to the interest rate cap contracts. Therefore, the Company has categorized these interest rate cap contracts as Level 2 fair value measurements. The fair value of the interest rate cap agreement was zero at March 22, 2016 (Successor) and December 29, 2015 (Successor).
 
The following is a summary of the estimated fair values for the long-term debt instruments (in thousands):
 
 
 
Successor
 
 
March 22, 2016
 
December 29, 2015
 
 
Estimated
Fair Value
 
Book Value
 
Estimated
Fair Value
 
Book Value
2015 Senior Credit Facility
 
$
152,313

 
$
152,313

 
$
152,224

 
$
152,224

Other Accrued Liabilities and Other Non-current Liabilities
Other Accrued Liabilities and Other Non-current Liabilities
Other Accrued Liabilities and Other Non-current Liabilities
A summary of other accrued liabilities follows (in thousands):
 
 
 
Successor
 
 
March 22, 2016
 
December 29, 2015
Employee compensation and related items
 
$
8,198

 
$
7,818

Accrued insurance
 
7,289

 
7,168

Accrued sales tax
 
5,006

 
3,604

Accrued advertising
 
1,725

 
999

Accrued real property tax
 
1,676

 
1,378

Restaurant closure liability
 
1,671

 
1,617

Accrued income taxes
 
1,067

 
30

Accrued bonus
 
914

 
5,352

Other
 
3,977

 
4,931

 
 
$
31,523

 
$
32,897


 
A summary of other non-current liabilities follows (in thousands):
 
 
 
Successor
 
 
March 22, 2016
 
December 29, 2015
Unfavorable lease liabilities
 
$
19,082

 
$
19,685

Insurance reserves
 
6,034

 
5,963

Restaurant closure liability
 
2,578

 
3,206

Unearned trade discount, non-current
 
1,939

 
2,028

Deferred development and initial franchise fees
 
1,907

 
1,920

Deferred gift card income
 
1,714

 
2,217

Deferred rent liability
 
933

 
731

Other
 
522

 
501

 
 
$
34,709

 
$
36,251

Stock-Based Compensation
Stock-Based Compensation
Stock-Based Compensation
In connection with the approval of the Business Combination, the Del Taco Restaurants, Inc. 2015 Omnibus Incentive Plan (the “2015 Plan”) was approved by shareholders to offer eligible employees, directors and consultants cash and stock-based incentive awards. Awards under the 2015 Plan are generally not restricted to any specific form or structure and could include, without limitation, stock options, stock appreciation rights, restricted stock, other stock-based awards, other cash-based compensation and performance awards. Under the plan, there were 3,300,000 share of common stock reserved and authorized. At March 22, 2016 (Successor), there were 2,077,506 shares of common stock available for grant under the 2015 Plan.
Stock-Based Compensation Expense (Successor)
The total compensation expense related to the 2015 Plan was $0.7 million for the twelve weeks ended March 22, 2016 (Successor). As of March 22, 2016 (Successor), $9.5 million of total unrecognized expense, net of estimated forfeitures, related to share-based compensation plans is expected to be recognized over a weighted-average remaining period of 3.2 years.
Restricted Stock Awards (Successor)
A summary of outstanding and unvested restricted stock activity as of March 22, 2016 (Successor) and changes during the period December 29, 2015 (Successor) through March 22, 2016 (Successor) is as follows:
 
 
 
Shares
 
Weighted-Average
Grant Date
Fair Value
Nonvested at December 29, 2015 (Successor)
 
946,494

 
$
11.16

Granted
 
45,000

 
10.64

Vested
 
—

 
—

Forfeited
 
—

 
—

Nonvested at March 22, 2016 (Successor)
 
991,494

 
$
11.14


As of March 22, 2016 (Successor), $8.8 million of total unrecognized expense related to unvested restricted stock grants is expected to be recognized over a weighted-average period of 3.2 years. The fair value of these awards was determined based on the Company’s stock price on the grant date.
Stock Options (Successor)
A summary of stock option activity as of March 22, 2016 (Successor) and changes during the period December 29, 2015 (Successor) through March 22, 2016 (Successor) is as follows:
 
 
Options
 
Weighted Average Exercise Price
 
Weighted Average Remaining Contractual Term
 
Aggregate Intrinsic Value
 
 
 
 
 
 
(in years)
 
(in thousands)
Options outstanding at December 29, 2015 (Successor)
 
224,000

 
$
10.40

 
6.5

 
$
67

Granted
 
7,000

 
9.88

 
6.8

 
—

Exercised
 
—

 
—

 
—

 
—

Forfeited
 
(2,000
)
 
10.40

 
—

 
—

Options outstanding at March 22, 2016 (Successor)
 
229,000

 
$
10.38

 
6.3

 
$
86

Options exercisable at March 22, 2016 (Successor)
 
—

 
$
—

 
—

 
$
—

Options exercisable and expected to vest at March 22, 2016 (Successor)
 
213,772

 
$
10.38

 
6.3

 
$
80


The aggregate intrinsic value in the table above is the amount by which the current market price of the Company's stock on December 29, 2015 (Successor) or March 22, 2016 (Successor), respectively, exceeds the exercise price.
As of March 22, 2016 (Successor), $0.7 million of total unrecognized stock compensation expense, net of forfeitures, related to stock option grants is expected to be recognized over a weighted average period of 3.3 years.
Stock-Based Compensation Expense (Predecessor)
In connection with Step 1 of the Business Combination consummated on March 20, 2015, all unvested restricted stock units (“RSUs”) under the Predecessor incentive plan became fully vested and all vested RSUs were then immediately settled for shares of DTH common stock, net of shares withheld for minimum statutory employee tax withholding obligations and all unvested stock options under the Predecessor plan became fully vested and all vested stock options were also exercised and shares were issued, net of shares withheld for the applicable option strike price and employee tax withholding obligations. An aggregate of 237,948 shares of DTH common stock were issued and 247,552 shares of DTH common stock were redeemed for applicable option strike price and employee tax withholding obligations. In exchange for the shares withheld, DTH made payments of $7.5 million related to employee tax withholding obligations.
No RSUs or stock options remained outstanding under the Predecessor plan after March 20, 2015 or as of March 22, 2016 (Successor). DTH recorded stock-based compensation expense of $0.5 million, which included all remaining unrecognized compensation expense related to the accelerated vesting on RSUs and stock options on March 20, 2015, for the twelve weeks ended March 24, 2015 (Predecessor).
Shareholders' Equity
Shareholders' Equity
Shareholders’ Equity
On February 26, 2016, the Company's Board of Directors authorized a share repurchase program covering up to $25.0 million of the Company's common stock and warrants which was effective immediately and expires upon completion of the repurchase program, unless terminated earlier by the Board of Directors. Purchases under the program may be made in open market or privately negotiated transactions. During the twelve weeks ended March 22, 2016 (Successor), the Company repurchased 86,679 shares for an average price per share of $10.79 for an aggregate cost of approximately $1.0 million including incremental direct costs to acquire the shares. The Company expects to retire the repurchased shares and therefore has accounted for them as constructively retired as of March 22, 2016 (Successor). As of March 22, 2016 (Successor), there was approximately $24.1 million remaining under the share repurchase program. The Company has no obligations to repurchase shares under this authorization, and the timing and value of shares purchased will depend on the Company's stock price, market conditions and other factors.
Earnings per Share
Earnings per Share
Earnings per Share
Basic income (loss) per share is calculated by dividing net income (loss) attributable to Del Taco’s common shareholders for the Successor period and to DTH’s common shareholders for the Predecessor period by the weighted average number of common shares outstanding for the period. In computing dilutive income (loss) per share, basic income (loss) per share is adjusted for the assumed issuance of all applicable potentially dilutive share-based awards, including warrants, restricted stock, common stock options and restricted stock units.
Below are basic and diluted net income (loss) per share for the periods indicated (amounts in thousands except share and per share data):
 
 
 
Successor
 
 
Predecessor
 
 
12 Weeks Ended
March 22, 2016
 
 
12 Weeks Ended
March 24, 2015
Numerator:
 
 
 
 
 
Net income (loss)
 
$
3,061

 
 
$
(4,940
)
Denominator:
 
 
 
 
 
Weighted-average shares outstanding - basic
 
38,798,014

 
 
4,074,498

Dilutive effect of restricted stock and RSUs
 
287

 
 
—

Dilutive effect of stock options
 
—

 
 
—

Dilutive effect of warrants
 
—

 
 
—

Weighted-average shares outstanding - diluted
 
38,798,301

 
 
4,074,498

Net income (loss) per share - basic
 
$
0.08

 
 
$
(1.21
)
Net income (loss) per share - diluted
 
$
0.08

 
 
$
(1.21
)
Antidilutive stock options, unvested restricted stock awards, unvested RSUs and warrants excluded from the computations
 
1,924,162

 
 
284,017

Antidilutive stock options and unvested restricted stock were excluded from the computation of diluted net income (loss) per share due to the assumed proceeds from the award’s exercise or vesting being greater than the average market price of the common shares or due to the Company incurring net losses for the periods presented.
Income Taxes
Income Taxes
Income Taxes
The effective income tax rates were 41.2% for the twelve weeks ended March 22, 2016 (Successor) compared to 10.2% for the twelve weeks ended March 24, 2015 (Predecessor), respectively. The provision for income taxes consisted of income tax expense of $2.1 million for the twelve weeks ended March 22, 2016 (Successor) and $0.5 million for the twelve weeks ended March 24, 2015 (Predecessor), respectively. The income tax expense related to the twelve weeks ended March 22, 2016 (Successor) is driven by the estimated effective income tax rate of 41.2% which primarily consists of statutory federal and state tax rates based on apportioned income, as well as providing for deferred tax liabilities for the excess of the amount for financial reporting over the tax basis of an investment in a domestic subsidiary, partially offset by federal targeted job credits. The income tax expense related to the twelve weeks ended March 24, 2015 (Predecessor) primarily related to the increase in deferred tax liabilities for indefinite-lived assets and the related effect of maintaining a full valuation allowance against certain of deferred tax assets as of March 24, 2015 (Predecessor).
Commitments and Contingencies
Commitments and Contingencies
Commitments and Contingencies
The primary claims in the Company’s business are workers’ compensation and general liabilities. These insurance programs are self-insured or high deductible programs with excess coverage that management believes is sufficient to adequately protect the Company. In the opinion of management, adequate provision has been made for all incurred claims up to the self-insured or high deductible limits, including provision for estimated claims incurred but not reported. Because of the uncertainty of the ultimate resolution of outstanding claims, as well as the uncertainty regarding claims incurred but not reported, it is possible that management’s provision for these losses could change materially. However, no estimate can currently be made of the range of additional losses.
Purchasing Commitments
The Company enters into various purchase obligations in the ordinary course of business, generally of short term nature. Those that are binding primarily relate to commitments for food purchases and supplies, amounts owed under contractor and subcontractor agreements, orders submitted for equipment for restaurants under construction, information technology service agreements and marketing initiatives, some of which are related to both Company-operated and franchised locations. The Company also has a long-term beverage supply agreement with a major beverage vendor whereby marketing rebates are provided to the Company and its franchisees based upon the volumes of purchases for system-wide restaurants which vary according to demand for beverage syrup. This contract has terms extending into 2021. The Company’s future estimated cash payments under existing contractual purchase obligations for goods and services as of March 22, 2016 (Successor), are approximately $86.4 million. The Company has excluded agreements that are cancelable without penalty.
 
Litigation
On April 23, 2015, a purported class action and derivative complaint, Jeffery Tomasulo, on behalf of himself and all others similarly situated v. Levy Acquisition Sponsor, LLC, Lawrence F. Levy, Howard B. Bernick, Marc S. Simon, Craig J. Duchossois, Ari B. Levy, Steven C. Florsheim, Gregory G. Flynn, Del Taco Holdings, Inc., and Levy Acquisition Corp. (“Complaint”), was filed in the Circuit Court of Cook County, Illinois (the “Circuit Court”), relating to the then proposed Business Combination pursuant to the Merger Agreement. The Complaint, which purported to be brought as a class action on behalf of all of the holders of the Company’s common stock, generally alleged that the Company’s pre-merger directors breached their fiduciary duties to stockholders by facilitating the then proposed Business Combination and in negotiating and approving the Merger Agreement. The Complaint also alleged that the Company’s preliminary proxy statement that was filed with the SEC on April 2, 2015 is materially misleading and/or incomplete. The Complaint further alleged that DTH and Levy Acquisition Sponsor LLC aided and abetted the alleged breaches by the Company’s pre-merger directors. The Complaint sought (a) a declaration that the Company’s pre-merger directors breached their fiduciary duties; (b) injunctive relief enjoining the Business Combination until corrective disclosures were made; (c) compensatory and/or rescissory damages; and (d) an award of costs and attorney’s fees.
The Company previously reached a settlement in principle of all claims asserted in the Complaint, subject to negotiation of a definitive settlement agreement and approval by the Circuit Court. To date, the parties have been unable to finalize a definitive settlement agreement. The Plaintiff has informed the Court that he wishes to file an amended complaint revising his claims, and the Court gave Plaintiff until May 5, 2016 to file a motion for leave to file an amended complaint.
The Company has a directors and officers liability insurance policy to cover legal defense costs and settlements stemming from covered claims, subject to an insurance deductible of $0.25 million per claim. The Company's insurance company has acknowledged coverage for claims asserted in the Complaint against covered persons, subject to a reservation of rights. The Company anticipates that any attorney's fees or expenses awarded by the Court in connection with any settlement will be paid in full by the insurance company, together with all or substantially all of any additional legal fees that may be incurred in connection with the action. As of December 29, 2015 (Successor), the Company had an insurance receivable of $0.3 million for legal defense costs it paid in excess of the deductible. The reimbursement from the insurance company was received in January 2016. During the twelve weeks ended March 22, 2016 (Successor), the Company has incurred $0.2 million in legal defense fees for which the Company has recorded a corresponding insurance receivable of $0.2 million as of March 22, 2016 (Successor).
In July 2013, a former Del Taco employee filed a purported class action complaint alleging that Del Taco has failed to pay overtime wages and has not appropriately provided meal breaks to its California general managers. Discovery has been completed and the parties are preparing their motions for and opposition to class certification. Del Taco has several defenses to the action that it believes should prevent the certification of the class, as well as the potential assessment of any damages on a class basis. Legal proceedings are inherently unpredictable, and the Company is not able to predict the ultimate outcome or cost of the unresolved matter. However, based on management’s current understanding of the relevant facts and circumstances, the Company does not believe that these proceedings give rise to a probable or estimable loss and should not have a material adverse effect on the Company’s financial position, operations or cash flows. Therefore, Del Taco has not recorded any amount for the claim as of March 22, 2016 (Successor).
In March 2014, a former Del Taco employee filed a purported class action complaint alleging that Del Taco has not appropriately provided meal breaks and failed to pay wages to its California hourly employees. Discovery is in process and Del Taco intends to assert all of its defenses to this threatened class action and the individual claims. Del Taco has several defenses to the action that it believes should prevent the certification of the class, as well as the potential assessment of any damages on a class basis. Legal proceedings are inherently unpredictable, and the Company is not able to predict the ultimate outcome or cost of the unresolved matter. However, based on management’s current understanding of the relevant facts and circumstances, the Company does not believe that these proceedings give rise to a probable or estimable loss and should not have a material adverse effect on the Company’s financial position, operations or cash flows. Therefore, Del Taco has not recorded any amount for the claim as of March 22, 2016 (Successor).
The Company and its subsidiaries are parties to other legal proceedings incidental to their businesses, including claims alleging the Company’s restaurants do not comply with the Americans with Disabilities Act of 1990. In the opinion of management, based upon information currently available, the ultimate liability with respect to those other actions will not have a material effect on the operating results, cash flows or the financial position of the Company.
Basis of Presentation and Summary of Significant Accounting Policies (Policies)
Basis of Presentation 
Basis of Presentation
The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and the rules and regulations of Securities and Exchange Commission (“SEC”). For additional information, these consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 29, 2015 ("2015 Form 10-K"). The accounting policies used in preparing these consolidated financial statements are the same as those described in our 2015 Form 10-K.
As a result of the Business Combination, the Company is the acquirer for accounting purposes, and DTH is the acquiree and accounting predecessor. The Company’s financial statement presentation distinguishes a “Predecessor” for DTH for periods prior to the Closing Date. The Company is the “Successor” for periods after the Closing Date, which includes consolidation of DTH subsequent to the Business Combination on June 30, 2015. The Merger was accounted for as a business combination using the acquisition method of accounting, and the Successor financial statements reflect a new basis of accounting that is based on the fair value of the net assets acquired. See Note 3 for further discussion of the Business Combination. As a result of the application of the acquisition method of accounting as of the Closing Date, the financial statements for the Predecessor period and for the Successor period are presented on a different basis and are therefore, not comparable. The historical financial information of Del Taco, formerly LAC, prior to the Business Combination have not been reflected in the financial statements as those amounts have been considered de-minimus.
 
The Company’s fiscal year ends on the Tuesday closest to December 31. Fiscal year 2016 is the fifty-three week period ended January 3, 2017 (Successor). Fiscal year 2015 is the fifty-two week period ended December 29, 2015 (Successor). In a fifty-three week fiscal year, the first, second and third quarters each include twelve weeks of operations and the fourth quarter includes seventeen weeks of operations. In a fifty-two week fiscal year, the first, second and third quarters each include twelve weeks of operations and the fourth quarter includes sixteen weeks of operations. For fiscal year 2016, the Company’s accompanying financial statements reflect the twelve weeks ended March 22, 2016 (Successor). For fiscal year 2015, the Company’s accompanying financial statements reflect the twelve weeks ended March 24, 2015 (Predecessor).
In the opinion of management, the accompanying consolidated financial statements reflect all adjustments which are necessary for a fair presentation of the consolidated financial position, results of operations and cash flows for the periods presented. The results of operations for such interim periods are not necessarily indicative of results of operations to be expected for the full fiscal year.
Principles of Consolidation 
Principles of Consolidation
The accompanying consolidated financial statements include the accounts of the Company and its wholly and majority owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.
Use of Estimates 
Use of Estimates
The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Management believes that such estimates have been based on reasonable and supportable assumptions and the resulting estimates are reasonable for use in the preparation of the consolidated financial statements. Actual results could differ from these estimates. The Company’s significant estimates include estimates for impairment of goodwill, intangible assets and property and equipment, valuations provided in business combinations, insurance reserves, restaurant closure reserves, stock-based compensation, contingent liabilities, certain leasing activities and income tax valuation allowances
Recently Issued Accounting Standards 
Recently Issued Accounting Standards
In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which provides a comprehensive new revenue recognition model that requires a company to recognize revenue in an amount that reflects the consideration it expects to receive for the transfer of promised goods or services to its customers. The standard also requires additional disclosure regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. This ASU is effective for annual periods and interim periods beginning after December 15, 2017. The ASU is to be applied retrospectively or using a cumulative effect transition method. The Company is currently evaluating which transition method to use and the effect that this pronouncement will have on its consolidated financial statements and related disclosures.
Business Combination (Tables)
Schedule of Preliminary Allocation of Purchase Price to Tangible and Identifiable Intangible Assets Acquired and Liabilities Assumed Based on Fair Value
The Company recorded a preliminary allocation of the purchase price to DTH’s tangible and identifiable intangible assets acquired and liabilities assumed based on their fair value as of the Closing Date. This allocation is subject to revision as the estimates of taxes are based on preliminary information and are subject to refinement. The preliminary purchase price allocation is as follows (in thousands):
 
 
Preliminary
Purchase Price
Allocation
Cash and cash equivalents
$
5,173

Accounts receivable and other receivables
3,228

Inventories
2,541

Prepaid expenses and other current assets
4,266

Total current assets
15,208

Property and equipment
105,524

Intangible assets
250,490

Other assets
4,194

Total identifiable assets acquired
375,416

Accounts payable
(18,866
)
Other accrued liabilities
(26,607
)
Current portion of capital lease obligations and deemed landlord financing liabilities
(1,670
)
Long-term debt, capital lease obligations and deemed landlord financing liabilities
(246,562
)
Deferred income taxes
(80,280
)
Other long-term liabilities
(36,208
)
Net identifiable liabilities assumed
(34,777
)
Goodwill
319,082

Total gross consideration
$
284,305

Restaurant Closure Charges, Net (Tables)
Restaurant Closure Liability Activity 
The following table represents other restaurant closure liability activity related to prior restaurant closures and sublease income shortfalls (in thousands):
 
 
Total
Balance at December 29, 2015 (Successor)
 
$
1,023

Charges for accretion in current period
 
19

Cash payments
 
(15
)
Balance at March 22, 2016 (Successor)
 
$
1,027

Closure Liability Activity for 12 Closed Restaurants 
A summary of the restaurant closure liability activity for these 12 closed restaurants consisted of the following (in thousands):
 
 
Contract termination costs
 
Other associated costs
 
Total
Balance at December 29, 2015 (Successor)
 
$
3,637

 
$
163

 
$
3,800

Charges for accretion in current period
 
35

 
—

 
35

Cash payments
 
(484
)
 
(129
)
 
(613
)
Balance at March 22, 2016 (Successor)
 
$
3,188

 
$
34

 
$
3,222

Goodwill and other Intangible Assets (Tables)
Schedule of Other Intangible Assets
The Company’s other intangible assets at March 22, 2016 (Successor) and December 29, 2015 (Successor) consisted of the following (in thousands):
 
 
Successor
 
 
March 22, 2016
 
December 29, 2015
 
 
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Net
 
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Net
Favorable lease assets
 
$
14,207

 
$
(1,483
)
 
$
12,724

 
$
14,207

 
$
(1,020
)
 
$
13,187

Franchise rights
 
15,789

 
(1,032
)
 
14,757

 
15,897

 
(711
)
 
15,186

Total amortized other intangible assets
 
$
29,996

 
$
(2,515
)
 
$
27,481

 
$
30,104

 
$
(1,731
)
 
$
28,373

Debt, Obligations Under Capital Leases and Deemed Landlord Financing Liabilities (Tables)
Schedule of Debt
The Company’s long-term debt, capital lease obligations and deemed landlord financing liabilities at March 22, 2016 (Successor) and December 29, 2015 (Successor) consisted of the following (in thousands):
 
 
 
Successor
 
 
March 22, 2016
 
December 29, 2015
2015 Senior Credit Facility, net of debt discount of $1,261 and $1,328 and deferred financing costs of $426 and $448 at March 22, 2016 (Successor) and December 29, 2015 (Successor), respectively
 
$
152,313

 
$
152,224

Total outstanding indebtedness
 
152,313

 
152,224

Obligations under capital leases and deemed landlord financing liabilities
 
17,048

 
17,469

Total debt
 
169,361

 
169,693

Less: amounts due within one year
 
1,684

 
1,725

Total amounts due after one year, net
 
$
167,677

 
$
167,968

 
Fair Value Measurements (Tables)
Summary of Estimated Fair Values of Long-term Debt Instruments, Warrant Liability and Interest Rate Cap Agreement
The following is a summary of the estimated fair values for the long-term debt instruments (in thousands):
 
 
 
Successor
 
 
March 22, 2016
 
December 29, 2015
 
 
Estimated
Fair Value
 
Book Value
 
Estimated
Fair Value
 
Book Value
2015 Senior Credit Facility
 
$
152,313

 
$
152,313

 
$
152,224

 
$
152,224

Other Accrued Liabilities and Other Non-current Liabilities (Tables)
Summary of Other Accrued Liabilities 
A summary of other accrued liabilities follows (in thousands):
 
 
 
Successor
 
 
March 22, 2016
 
December 29, 2015
Employee compensation and related items
 
$
8,198

 
$
7,818

Accrued insurance
 
7,289

 
7,168

Accrued sales tax
 
5,006

 
3,604

Accrued advertising
 
1,725

 
999

Accrued real property tax
 
1,676

 
1,378

Restaurant closure liability
 
1,671

 
1,617

Accrued income taxes
 
1,067

 
30

Accrued bonus
 
914

 
5,352

Other
 
3,977

 
4,931

 
 
$
31,523

 
$
32,897

Summary of Other Non-current Liabilities 
A summary of other non-current liabilities follows (in thousands):
 
 
 
Successor
 
 
March 22, 2016
 
December 29, 2015
Unfavorable lease liabilities
 
$
19,082

 
$
19,685

Insurance reserves
 
6,034

 
5,963

Restaurant closure liability
 
2,578

 
3,206

Unearned trade discount, non-current
 
1,939

 
2,028

Deferred development and initial franchise fees
 
1,907

 
1,920

Deferred gift card income
 
1,714

 
2,217

Deferred rent liability
 
933

 
731

Other
 
522

 
501

 
 
$
34,709

 
$
36,251

Stock-Based Compensation (Tables)
Summary of Outstanding and Unvested Restricted Stock Activity 
A summary of outstanding and unvested restricted stock activity as of March 22, 2016 (Successor) and changes during the period December 29, 2015 (Successor) through March 22, 2016 (Successor) is as follows:
 
 
 
Shares
 
Weighted-Average
Grant Date
Fair Value
Nonvested at December 29, 2015 (Successor)
 
946,494

 
$
11.16

Granted
 
45,000

 
10.64

Vested
 
—

 
—

Forfeited
 
—

 
—

Nonvested at March 22, 2016 (Successor)
 
991,494

 
$
11.14

Summary of Stock Options Activity 
A summary of stock option activity as of March 22, 2016 (Successor) and changes during the period December 29, 2015 (Successor) through March 22, 2016 (Successor) is as follows:
 
 
Options
 
Weighted Average Exercise Price
 
Weighted Average Remaining Contractual Term
 
Aggregate Intrinsic Value
 
 
 
 
 
 
(in years)
 
(in thousands)
Options outstanding at December 29, 2015 (Successor)
 
224,000

 
$
10.40

 
6.5

 
$
67

Granted
 
7,000

 
9.88

 
6.8

 
—

Exercised
 
—

 
—

 
—

 
—

Forfeited
 
(2,000
)
 
10.40

 
—

 
—

Options outstanding at March 22, 2016 (Successor)
 
229,000

 
$
10.38

 
6.3

 
$
86

Options exercisable at March 22, 2016 (Successor)
 
—

 
$
—

 
—

 
$
—

Options exercisable and expected to vest at March 22, 2016 (Successor)
 
213,772

 
$
10.38

 
6.3

 
$
80

Earnings per Share (Tables)
Schedule of Basic and Diluted Net Income (Loss) Per Share Data
Below are basic and diluted net income (loss) per share for the periods indicated (amounts in thousands except share and per share data):
 
 
 
Successor
 
 
Predecessor
 
 
12 Weeks Ended
March 22, 2016
 
 
12 Weeks Ended
March 24, 2015
Numerator:
 
 
 
 
 
Net income (loss)
 
$
3,061

 
 
$
(4,940
)
Denominator:
 
 
 
 
 
Weighted-average shares outstanding - basic
 
38,798,014

 
 
4,074,498

Dilutive effect of restricted stock and RSUs
 
287

 
 
—

Dilutive effect of stock options
 
—

 
 
—

Dilutive effect of warrants
 
—

 
 
—

Weighted-average shares outstanding - diluted
 
38,798,301

 
 
4,074,498

Net income (loss) per share - basic
 
$
0.08

 
 
$
(1.21
)
Net income (loss) per share - diluted
 
$
0.08

 
 
$
(1.21
)
Antidilutive stock options, unvested restricted stock awards, unvested RSUs and warrants excluded from the computations
 
1,924,162

 
 
284,017

Description of Business - Additional Information (Details)
3 Months Ended
Mar. 22, 2016
Mar. 22, 2016
Successor [Member]
state
Mar. 22, 2016
Successor [Member]
Entity Operated Units [Member]
restaurant
Mar. 22, 2016
Successor [Member]
Franchised Units [Member]
restaurant
Mar. 22, 2016
Successor [Member]
Franchised Units [Member]
GUAM
restaurant
Mar. 24, 2015
Predecessor [Member]
state
Mar. 24, 2015
Predecessor [Member]
Entity Operated Units [Member]
restaurant
Mar. 24, 2015
Predecessor [Member]
Franchised Units [Member]
restaurant
Mar. 24, 2015
Predecessor [Member]
Franchised Units [Member]
GUAM
restaurant
Franchisor Disclosure [Line Items]
 
 
 
 
 
 
 
 
 
Number of restaurants
 
 
297 
246 
1 
 
304 
242 
1 
Number of states in which entity operates
 
17 
 
 
 
16 
 
 
 
Stock purchase agreement date
Mar. 12, 2015 
 
 
 
 
 
 
 
 
Business Combination - Additional Information (Detail) (USD $)
0 Months Ended 3 Months Ended 0 Months Ended 3 Months Ended 0 Months Ended
Jun. 30, 2015
Jun. 30, 2015
DTH
Mar. 22, 2016
Successor [Member]
Mar. 22, 2016
Successor [Member]
DTH
Jun. 30, 2015
Predecessor [Member]
Mar. 24, 2015
Predecessor [Member]
Jun. 30, 2015
Predecessor [Member]
DTH
Jun. 30, 2015
DTH Share Holders [Member]
Predecessor [Member]
Business Acquisition [Line Items]
 
 
 
 
 
 
 
 
Number of shares issued (in shares)
 
 
 
 
3,089,532 
 
2,348,968 
740,564 
Proceeds from issuance of common stock
 
 
$ 0 
 
 
$ 91,236,000 
$ 91,200,000 
$ 28,800,000 
Payments to acquire businesses, gross
120,000,000 
284,300,000 
 
 
 
 
 
 
Goodwill adjustments
 
 
 
(800,000)
 
 
 
 
Payments of transaction cost
 
 
$ 100,000 
 
 
$ 6,316,000 
 
 
Business Combination - Schedule of Preliminary Allocation of Purchase Price to Tangible and Identifiable Intangible Assets Acquired and Liabilities Assumed Based on Fair Value (Detail) (DTH, USD $)
In Thousands, unless otherwise specified
Jun. 30, 2015
DTH
 
Business Acquisition [Line Items]
 
Cash and cash equivalents
$ 5,173 
Accounts receivable and other receivables
3,228 
Inventories
2,541 
Prepaid expenses and other current assets
4,266 
Total current assets
15,208 
Property and equipment
105,524 
Intangible assets
250,490 
Other assets
4,194 
Total identifiable assets acquired
375,416 
Accounts payable
(18,866)
Other accrued liabilities
(26,607)
Current portion of capital lease obligations and deemed landlord financing liabilities
(1,670)
Long-term debt, capital lease obligations and deemed landlord financing liabilities
(246,562)
Deferred income taxes
(80,280)
Other long-term liabilities
(36,208)
Net identifiable liabilities assumed
(34,777)
Goodwill
319,082 
Total gross consideration
$ 284,305 
Restaurant Closure Charges, Net - Additional Information (Details) (Successor [Member], USD $)
3 Months Ended 4 Months Ended
Mar. 22, 2016
Dec. 29, 2015
Dec. 29, 2015
Closure of 12 Underperforming Restaurants [Member]
location
Mar. 22, 2016
Closure of 12 Underperforming Restaurants [Member]
Mar. 22, 2016
Facility Closing [Member]
Dec. 29, 2015
Facility Closing [Member]
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
Restructuring closure liability
$ 4,200,000 
$ 4,800,000 
$ 3,800,000 
$ 3,222,000 
$ 1,027,000 
$ 1,023,000 
Current portion of restaurant closure liability
1,671,000 
1,617,000 
1,500,000 
1,500,000 
100,000 
100,000 
Non-current portion of restaurant closure liability
2,578,000 
3,206,000 
2,300,000 
1,700,000 
900,000 
900,000 
Number of underperforming locations
 
 
12 
 
 
 
Write-off of fixed assets
$ 100,000 
 
 
 
 
 
Restaurant Closure Charges, Net - Restaurant Closure Liability Activity (Details) (Successor [Member], USD $)
In Thousands, unless otherwise specified
3 Months Ended
Mar. 22, 2016
Dec. 29, 2015
Restructuring Reserve [Roll Forward]
 
 
Closure liability, Beginning balance
$ 4,800 
 
Charges for accretion in current period
124 
 
Closure liability, Ending balance
4,200 
 
Non-current portion of restaurant closure liability
2,578 
3,206 
Facility Closing [Member]
 
 
Restructuring Reserve [Roll Forward]
 
 
Closure liability, Beginning balance
1,023 
 
Charges for accretion in current period
19 
 
Cash payments
(15)
 
Closure liability, Ending balance
1,027 
 
Non-current portion of restaurant closure liability
900 
900 
Closure of 12 Underperforming Restaurants [Member]
 
 
Restructuring Reserve [Roll Forward]
 
 
Closure liability, Beginning balance
3,800 
 
Charges for accretion in current period
35 
 
Cash payments
(613)
 
Closure liability, Ending balance
3,222 
 
Non-current portion of restaurant closure liability
1,700 
2,300 
Closure of 12 Underperforming Restaurants [Member] |
Contract termination costs
 
 
Restructuring Reserve [Roll Forward]
 
 
Closure liability, Beginning balance
3,637 
 
Charges for accretion in current period
35 
 
Cash payments
(484)
 
Closure liability, Ending balance
3,188 
 
Closure of 12 Underperforming Restaurants [Member] |
Other associated costs
 
 
Restructuring Reserve [Roll Forward]
 
 
Closure liability, Beginning balance
163 
 
Charges for accretion in current period
0 
 
Cash payments
(129)
 
Closure liability, Ending balance
$ 34 
 
Goodwill and other Intangible Assets - Schedule of Other Intangible Assets (Detail) (Successor [Member], USD $)
In Thousands, unless otherwise specified
Mar. 22, 2016
Dec. 29, 2015
Finite-Lived Intangible Assets [Line Items]
 
 
Gross Carrying Amount
$ 29,996 
$ 30,104 
Accumulated Amortization
(2,515)
(1,731)
Net
27,481 
28,373 
Favorable Lease Assets [Member]
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Gross Carrying Amount
14,207 
14,207 
Accumulated Amortization
(1,483)
(1,020)
Net
12,724 
13,187 
Franchise rights [Member]
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Gross Carrying Amount
15,789 
15,897 
Accumulated Amortization
(1,032)
(711)
Net
$ 14,757 
$ 15,186 
Goodwill and other Intangible Assets - Additional Information (Details) (Successor [Member], USD $)
3 Months Ended
Mar. 22, 2016
location
Dec. 29, 2015
Finite-Lived Intangible Assets [Line Items]
 
 
Goodwill
$ 319,100,000 
$ 318,275,000 
Number of franchise locations closed
2 
 
Franchise rights [Member]
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Franchise rights written off
$ 100,000 
 
Debt, Obligations Under Capital Leases and Deemed Landlord Financing Liabilities - Schedule of Debt (Detail) (Successor [Member], USD $)
In Thousands, unless otherwise specified
Mar. 22, 2016
Dec. 29, 2015
Aug. 4, 2015
Debt Instrument [Line Items]
 
 
 
Total outstanding indebtedness
$ 152,313 
$ 152,224 
 
Obligations under capital leases and deemed landlord financing liabilities
17,048 
17,469 
 
Total debt
169,361 
169,693 
 
Less: amounts due within one year
1,684 
1,725 
 
Total amounts due after one year, net
167,677 
167,968 
 
2015 Revolving Credit Facility [Member]
 
 
 
Debt Instrument [Line Items]
 
 
 
Debt discount
1,261 
1,328 
1,400 
Deferred finance costs
426 
448 
 
Revolving credit facility
$ 152,313 
$ 152,224 
 
Debt, Obligations Under Capital Leases and Deemed Landlord Financing Liabilities - Additional Information (Detail) (USD $)
1 Months Ended 3 Months Ended 0 Months Ended 0 Months Ended 3 Months Ended 0 Months Ended 3 Months Ended 0 Months Ended 0 Months Ended 3 Months Ended 3 Months Ended 1 Months Ended 3 Months Ended 0 Months Ended
Mar. 31, 2015
DTH 2013 Senior Credit Facility [Member]
Mar. 20, 2015
DTH 2013 Senior Credit Facility [Member]
Mar. 22, 2016
Successor [Member]
Aug. 4, 2015
Successor [Member]
2015 Revolving Credit Facility [Member]
Mar. 22, 2016
Successor [Member]
2015 Revolving Credit Facility [Member]
Dec. 29, 2015
Successor [Member]
2015 Revolving Credit Facility [Member]
Aug. 4, 2015
Successor [Member]
2015 Revolving Credit Facility [Member]
Aug. 4, 2015
Successor [Member]
LIBOR [Member]
2015 Revolving Credit Facility [Member]
Mar. 22, 2016
Successor [Member]
LIBOR [Member]
2015 Revolving Credit Facility [Member]
Aug. 4, 2015
Successor [Member]
LIBOR [Member]
2015 Revolving Credit Facility [Member]
Minimum [Member]
Aug. 4, 2015
Successor [Member]
LIBOR [Member]
2015 Revolving Credit Facility [Member]
Maximum [Member]
Mar. 22, 2016
Successor [Member]
Base Rate [Member]
2015 Revolving Credit Facility [Member]
Aug. 4, 2015
Successor [Member]
Base Rate [Member]
2015 Revolving Credit Facility [Member]
Minimum [Member]
Aug. 4, 2015
Successor [Member]
Base Rate [Member]
2015 Revolving Credit Facility [Member]
Maximum [Member]
Aug. 4, 2015
Successor [Member]
Federal Funds Effective Swap Rate [Member]
2015 Revolving Credit Facility [Member]
Aug. 4, 2015
Successor [Member]
DTH 2013 Senior Credit Facility [Member]
Mar. 20, 2015
Successor [Member]
DTH 2013 Senior Credit Facility [Member]
Aug. 4, 2015
Successor [Member]
DTH 2013 Senior Credit Facility [Member]
2013 Term Loan [Member]
Mar. 20, 2015
Successor [Member]
DTH 2013 Senior Credit Facility [Member]
2013 Term Loan [Member]
Mar. 20, 2015
Successor [Member]
DTH 2013 Senior Credit Facility [Member]
2013 Revolver [Member]
Aug. 4, 2015
Successor [Member]
DTH 2013 Senior Credit Facility [Member]
Secured Debt [Member]
Mar. 24, 2015
Predecessor [Member]
Mar. 20, 2015
Predecessor [Member]
Mar. 24, 2015
Predecessor [Member]
Line of Credit [Member]
DTH 2013 Senior Credit Facility [Member]
Mar. 31, 2015
Predecessor [Member]
Medium-term Notes [Member]
DTH 2013 Senior Credit Facility [Member]
Mar. 24, 2015
Predecessor [Member]
DTH 2013 Senior Credit Facility [Member]
Mar. 12, 2015
Predecessor [Member]
DTH 2013 Senior Credit Facility [Member]
LIBOR [Member]
Mar. 12, 2015
Predecessor [Member]
DTH 2013 Senior Credit Facility [Member]
LIBOR [Member]
Maximum [Member]
Debt Instrument [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Credit agreement issuance date
 
 
 
Aug. 04, 2015 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Credit agreement maturity date
 
 
 
Aug. 04, 2020 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Credit facility amount
 
 
 
 
 
 
$ 250,000,000 
 
 
 
 
 
 
 
 
 
$ 267,100,000.0 
 
 
$ 40,000,000 
 
 
 
 
 
 
 
 
Payment of senior secured debt and costs associated with refinancing
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
164,000,000 
 
 
 
 
 
 
 
Credit facility
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
162,500,000 
227,100,000 
 
 
 
 
 
 
 
 
 
Credit facility
 
 
 
 
19,000,000 
 
 
 
 
 
 
 
 
 
 
17,600,000 
 
 
 
 
 
 
 
 
 
 
 
 
Effective base rate, margins on variable rate (percent)
 
 
 
 
 
 
 
1.00% 
 
 
 
 
 
 
0.50% 
 
 
 
 
 
 
 
 
 
 
 
 
 
Credit facility margins on variable rate (percent)
 
 
 
 
 
 
 
2.00% 
 
1.50% 
2.50% 
 
0.50% 
1.50% 
 
 
 
 
 
 
 
 
 
 
 
 
4.25% 
 
Decrease on applicable margin (percent)
 
 
 
 
 
 
 
 
(0.25%)
 
 
(0.25%)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Credit fees applicable margin percentage (percent)
 
 
 
1.75% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unused commitment fee percentage (percent)
 
 
 
0.20% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unamortized debt discount
 
 
 
 
1,261,000 
1,328,000 
1,400,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,500,000 
 
 
 
 
 
 
Deferred financing costs
 
 
 
 
 
 
500,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Amortization of deferred financing costs including debt discount
 
 
100,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
400,000 
 
 
Interest rate on outstanding balance of credit facility (percent)
 
 
 
 
2.20% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Availability for additional borrowings under credit facility
 
 
 
 
77,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Credit facility
 
 
 
 
154,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Increase (decrease) in borrowing capacity
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
25,100,000 
 
 
 
Proceed from revolver
10,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Outstanding amount of subordinated notes
 
111,200,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
111,200,000 
 
 
 
 
 
Increase (Decrease) in interest rate
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1.00% 
Debt refinancing cost
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,600,000 
 
 
 
 
 
 
Debt modification costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
100,000 
 
 
 
 
Interest expenses related to subordinated notes
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 3,100,000 
 
 
 
 
 
 
Derivative Instruments - Additional Information (Details) (USD $)
0 Months Ended 3 Months Ended 0 Months Ended
Mar. 20, 2015
Predecessor [Member]
Mar. 24, 2015
Predecessor [Member]
Mar. 20, 2015
GSMP [Member]
Predecessor [Member]
Mar. 20, 2015
GSMP [Member]
Predecessor [Member]
Mar. 22, 2016
Interest Rate Cap [Member]
Cash Flow Hedging [Member]
Successor [Member]
Dec. 29, 2015
Interest Rate Cap [Member]
Cash Flow Hedging [Member]
Successor [Member]
Derivative [Line Items]
 
 
 
 
 
 
Notional amount
 
 
 
 
$ 87,500,000.0 
$ 87,500,000.0 
Warrants to purchase of common stock (in shares)
 
 
 
597,802 
 
 
Warrant exercise price per share (in dollars per share)
 
 
 
$ 25.00 
 
 
Fair value of warrant liability
 
 
 
8,300,000 
 
 
Common shares redeemed
 
 
384,777 
 
 
 
Exercise and settlement of warrants (in shares)
213,025 
 
 
 
 
 
Reduction in warrant liability due to mark-to-market adjustment
 
$ 35,000 
 
 
 
 
Fair Value Measurements - Additional Information (Detail) (Successor [Member], Interest Rate Cap [Member], USD $)
Mar. 22, 2016
Dec. 29, 2015
Successor [Member] |
Interest Rate Cap [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Fair value of interest rate cap
$ 0 
$ 0 
Fair Value Measurements - Summary of Estimated Fair Values of Long-term Debt Instruments, Warrant Liability and Interest Rate Cap Agreement (Detail) (Successor [Member], 2015 Revolving Credit Facility [Member], USD $)
In Thousands, unless otherwise specified
Mar. 22, 2016
Dec. 29, 2015
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Credit Facility
$ 154,000 
 
Estimated Fair Value [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Credit Facility
152,313 
152,224 
Book Value [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Credit Facility
$ 152,313 
$ 152,224 
Other Accrued Liabilities and Other Non-current Liabilities - Summary of Other Accrued Liabilities (Detail) (Successor [Member], USD $)
In Thousands, unless otherwise specified
Mar. 22, 2016
Dec. 29, 2015
Successor [Member]
 
 
Accounts Payable And Accrued Liabilities Current And Noncurrent [Line Items]
 
 
Employee compensation and related items
$ 8,198 
$ 7,818 
Accrued insurance
7,289 
7,168 
Accrued sales tax
5,006 
3,604 
Accrued advertising
1,725 
999 
Accrued real property tax
1,676 
1,378 
Restaurant closure liability
1,671 
1,617 
Accrued income taxes
1,067 
30 
Accrued bonus
914 
5,352 
Other
3,977 
4,931 
Other accrued liabilities
$ 31,523 
$ 32,897 
Other Accrued Liabilities and Other Non-current Liabilities - Summary of Other Non-current Liabilities (Detail) (Successor [Member], USD $)
In Thousands, unless otherwise specified
Mar. 22, 2016
Dec. 29, 2015
Successor [Member]
 
 
Other Non Current Liabilities [Line Items]
 
 
Unfavorable lease liabilities
$ 19,082 
$ 19,685 
Insurance reserves
6,034 
5,963 
Restaurant closure liability
2,578 
3,206 
Unearned trade discount, non-current
1,939 
2,028 
Deferred development and initial franchise fees
1,907 
1,920 
Deferred gift card income
1,714 
2,217 
Deferred rent liability
933 
731 
Other
522 
501 
Other non-current liabilities
$ 34,709 
$ 36,251 
Stock-Based Compensation - Additional Information (Details) (USD $)
3 Months Ended 3 Months Ended 0 Months Ended 3 Months Ended
Mar. 22, 2016
2015 Plan [Member]
Mar. 22, 2016
Successor [Member]
Dec. 29, 2015
Successor [Member]
Mar. 22, 2016
Successor [Member]
2015 Plan [Member]
Mar. 22, 2016
Successor [Member]
Restricted Shares [Member]
Mar. 20, 2015
Predecessor [Member]
Mar. 24, 2015
Predecessor [Member]
Mar. 22, 2016
Predecessor [Member]
Mar. 22, 2016
Predecessor [Member]
Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
 
 
 
 
 
Common stock reserved and authorized for issuance (in shares)
3,300,000 
 
 
 
 
 
 
 
 
Common stock authorized and available for grant (in shares)
2,077,506 
 
 
 
 
 
 
 
 
Stock-based compensation expense recorded
 
 
 
$ 700,000 
 
 
$ 500,000 
 
 
Unrecognized compensation expense, net
 
 
 
 
8,800,000 
 
 
 
 
Total unrecognized expense related to share-based compensation plans
 
9,500,000 
 
 
 
 
 
 
 
Weighted average period of recognition (in years)
 
3 years 2 months 12 days 
 
 
3 years 2 months 12 days 
 
 
 
 
Unrecognized stock compensation expense
 
700,000 
 
 
 
 
 
 
 
Vesting period (in years)
 
 
 
 
3 years 3 months 18 days 
 
 
 
 
Shares issued for employee tax withholding obligations (in shares)
 
 
 
 
 
237,948 
 
 
 
Shares redeemed for employee tax withholding obligations (in shares)
 
 
 
 
 
247,552 
 
 
 
Payments related to employee tax withholding obligations
 
$ 0 
 
 
 
$ 7,500,000 
$ 7,533,000 
 
 
Number of awards outstanding (in shares)
 
991,494 
946,494 
 
 
 
 
 
0 
Number of stock options outstanding (in shares)
 
229,000 
224,000 
 
 
 
 
0 
 
Stock-Based Compensation - Summary of Outstanding and Unvested Restricted Stock Activity (Details) (Successor [Member], USD $)
3 Months Ended
Mar. 22, 2016
Successor [Member]
 
Shares
 
Nonvested Shares, Beginning balance (in shares)
946,494 
Granted (in shares)
45,000 
Vested (in shares)
0 
Forfeited (in shares)
0 
Nonvested Shares, Ending balance (in shares)
991,494 
Weighted-Average Grant Date Fair Value
 
Weighted-Average Grant Date Fair Value, Beginning balance (in dollars per share)
$ 11.16 
Weighted-Average Grant Date Fair Value, Granted (in dollars per share)
$ 10.64 
Weighted-Average Grant Date Fair Value, Vested (in dollars per share)
$ 0.00 
Weighted-Average Grant Date Fair Value, Forfeited (in dollars per share)
$ 0.00 
Weighted-Average Grant Date Fair Value, Ending balance (in dollars per share)
$ 11.14 
Stock-Based Compensation - Summary of Stock Options Activity (Details) (Successor [Member], USD $)
In Thousands, except Share data, unless otherwise specified
3 Months Ended 12 Months Ended
Mar. 22, 2016
Dec. 29, 2015
Successor [Member]
 
 
Shares
 
 
Options outstanding, Beginning balance (in shares)
224,000 
 
Granted (in shares)
7,000 
 
Exercised (in shares)
0 
 
Forfeited (in shares)
(2,000)
 
Options outstanding, Ending balance (in shares)
229,000 
224,000 
Options exercisable (in shares)
0 
 
Options exercisable and expected to vest (in shares)
213,772 
 
Weighted Average Exercise Price
 
 
Weighted Average Exercise Price, Options outstanding, Beginning balance (in dollars per share)
$ 10.40 
 
Weighted Average Exercise Price, Granted (in dollars per share)
$ 9.88 
 
Weighted Average Exercise Price, Exercised (in dollars per share)
$ 0.00 
 
Weighted Average Exercise Price, Forfeited (in dollars per share)
$ 10.40 
 
Weighted Average Exercise Price, Options outstanding, Ending balance (in dollars per share)
$ 10.38 
$ 10.40 
Weighted Average Exercise Price, Options exercisable (in dollars per share)
$ 0.00 
 
Weighted Average Exercise Price, Options exercisable and expected (in dollars per share)
$ 10.38 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract]
 
 
Weighted Average Remaining Contractual Term, Options outstanding (in years)
6 years 3 months 18 days 
6 years 6 months 
Weighted Average Remaining Contractual Term, Granted (in years)
6 years 9 months 18 days 
 
Weighted Average Remaining Contractual Term, Options exercisable and expected to vest (in years)
6 years 3 months 18 days 
 
Aggregate Intrinsic Value, Options outstanding, Beginning balance
$ 67 
 
Aggregate Intrinsic Value, Options outstanding, Ending balance
86 
67 
Aggregate Intrinsic Value, Options exercisable and expected to vest
$ 80 
 
Shareholders' Equity - Additional Information (Detail) (USD $)
3 Months Ended
Feb. 26, 2016
Common Stock and Warrants [Member]
Mar. 22, 2016
Successor [Member]
Common Stock and Warrants [Member]
Mar. 22, 2016
Successor [Member]
Common Stock [Member]
Class of Stock [Line Items]
 
 
 
Maximum authorized stock repurchase amount (up to)
$ 25,000,000.0 
 
 
Shares repurchased (in shares)
 
 
86,679 
Treasury Stock Acquired, Average Cost Per Share
 
 
$ 10.79 
Shares repurchased, value
 
 
1,000,000 
Remaining authorized stock repurchase amount
 
$ 24,100,000 
 
Earnings per Share - Schedule of Basic and Diluted Net Income per Share Data (Detail) (USD $)
In Thousands, except Share data, unless otherwise specified
3 Months Ended
Mar. 22, 2016
Successor [Member]
Mar. 22, 2016
Successor [Member]
Restricted Stock and RSUs [Member]
Mar. 22, 2016
Successor [Member]
Stock Options [Member]
Mar. 22, 2016
Successor [Member]
Warrants [Member]
Mar. 24, 2015
Predecessor [Member]
Mar. 24, 2015
Predecessor [Member]
Restricted Stock and RSUs [Member]
Mar. 24, 2015
Predecessor [Member]
Stock Options [Member]
Mar. 24, 2015
Predecessor [Member]
Warrants [Member]
Numerator:
 
 
 
 
 
 
 
 
Net income (loss)
$ 3,061 
 
 
 
$ (4,940)
 
 
 
Denominator:
 
 
 
 
 
 
 
 
Weighted-average shares outstanding - basic (in shares)
38,798,014 
 
 
 
4,074,498 
 
 
 
Dilutive effect (in shares)
 
287 
0 
0 
 
0 
0 
0 
Weighted-average shares outstanding - diluted
38,798,301 
 
 
 
4,074,498 
 
 
 
Net (loss) income per share - basic (in dollars per share)
$ 0.08 
 
 
 
$ (1.21)
 
 
 
Net (loss) income per share - diluted (in dollars per share)
$ 0.08 
 
 
 
$ (1.21)
 
 
 
Antidilutive stock options, unvested restricted stock awards, unvested RSUs and warrants excluded from the computations (in dollars per share)
1,924,162 
 
 
 
284,017 
 
 
 
Income Taxes - Additional Information (Detail) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 22, 2016
Successor [Member]
Mar. 24, 2015
Predecessor [Member]
Income Tax Disclosure [Line Items]
 
 
Effective income tax rates (percent)
41.20% 
10.20% 
Provision for income taxes
$ 2.1 
$ 0.5 
Commitments and Contingencies - Additional Information (Detail) (USD $)
In Millions, unless otherwise specified
3 Months Ended 3 Months Ended
Mar. 22, 2016
Mar. 22, 2016
Litigation Case on April 2015
Mar. 22, 2016
Successor [Member]
Mar. 22, 2016
Successor [Member]
Litigation Case on April 2015
Dec. 29, 2015
Successor [Member]
Insurance Claims [Member]
Mar. 22, 2016
Successor [Member]
Insurance Claims [Member]
Litigation Case on April 2015
Loss Contingencies [Line Items]
 
 
 
 
 
 
Purchasing commitments contract extended terms
2021 
 
 
 
 
 
Contractual purchase obligations for goods and services
 
 
$ 86.4 
 
 
 
Insurance deductible per claim
 
0.25 
 
 
 
 
Reimbursement form insurance claim
 
 
 
 
0.3 
0.2 
Legal defense fees
 
 
 
$ 0.2