COMMITMENTS AND CONTINGENCIES

12 Months Ended

Dec. 29, 2019

Commitments and Contingencies

Commitments and Contingencies

(8)         COMMITMENTS AND CONTINGENCIES

Operating Leases

We lease most of our Company-owned restaurants and office facilities under non-cancelable operating leases with remaining minimum terms ranging from one to 20 years. Our lease agreements generally contain base rent escalations that are either fixed pursuant to the lease agreement or based on the consumer price index. We are also required to pay contingent rentals on certain of our leases in amounts between 5% and 8% of gross sales above a minimum threshold. Beginning in fiscal 2019, we adopted ASC 842 – Leases. Under this standard, we determine if an arrangement is a lease at inception. Operating leases are included in ROU assets, current portion of operating lease liabilities, and operating lease liabilities in our consolidated balance sheets. ROU assets and operating lease liabilities are recognized based on the present value of lease payments over the lease term at the commencement date.

The following table sets forth certain information related to our rental activities as of the periods presented:

	Year Ended
(in thousands)		December 29, 2019
Operating lease cost		$	4,261
Short-term lease cost			123
Variable lease cost			31
Sublease income			(248)
Total lease cost			4,167

	Year Ended
(in thousands)	December 29, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	4,424
Right-of-use assets obtained in exchange for new operating lease liabilities		18,458
Weighted-average remaining lease term of operating leases (in years)		9.56
Weighted-average discount rate of operating leases		5.56	%

Future maturities of our lease liabilities, as of December 29, 2019, are as follows:

(in thousands)
Fiscal Year
2020	$	5,194
2021		5,078

2022		4,785
2023		3,918
2024		2,856
Thereafter		15,070
Total operating lease obligations		36,901
Less imputed interest		(5,944)
Total	$	30,957

Litigation

In the normal course of business, we are involved in a number of litigation matters that are incidental to the operation of the business. These matters generally include, among other things, matters with regard to employment and general business-related issues. We currently believe that the resolution of any of these pending matters will not have a material adverse effect on our financial position or liquidity, but an adverse decision in more than one of the matters could be material to our consolidated results of operations.