Impairment of Long-Lived Assets

8 Months Ended

Sep. 08, 2015

Impairment of Long-Lived Assets [Abstract]

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9.	IMPAIRMENT OF LONG-LIVED ASSETS

Property and equipment and finite-lived intangibles are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. The Company reviews applicable finite-lived intangible assets and long-lived assets related to each restaurant on a periodic basis. The Company’s assessment of recoverability of property and equipment and finite-lived intangible assets is performed at the component level, which is generally an individual restaurant. When events or changes in circumstances indicate an asset may not be recoverable, the Company estimates the future cash flows expected to result from the use of the asset. If the sum of the expected undiscounted future cash flows is less than the carrying value of the asset, an impairment loss is recognized. The impairment loss is recognized by measuring the difference between the carrying value of the assets and the estimated fair value of the assets. The Company’s estimates of fair values are based on the best information available and require the use of estimates, judgements and projections. The actual results may vary significantly from the estimates.

During the third quarter of fiscal 2015, the Company determined that the carrying amount of one of its Grille restaurants was not recoverable. Therefore, the Company recorded a non-cash impairment charge of $3.3 million, which represents the difference between the carrying value of the restaurant assets and the value of furniture and restaurant equipment that may be transferred to future Grille locations. This amount is included in non-cash impairment charges in the consolidated statements of income (loss) and comprehensive income (loss).