Fair Value Measurements (Tables)

6 Months Ended

Jul. 01, 2018

Fair value, financial instruments measured on nonrecurring basis, valuation techniques

Fair value of debt is determined based on the following:



DEBT FACILITY		METHODS AND ASSUMPTIONS
Senior Secured Credit Facility		Quoted market prices in inactive markets.
Other notes payable		Discounted cash flow approach with inputs that primarily include cost of debt interest rates used to determine fair value.

Fair value is categorized into one of the following three levels based on the lowest level of significant input:



Level 1		Unadjusted quoted market prices in active markets for identical assets or liabilities
Level 2		Observable inputs available at measurement date other than quoted prices included in Level 1
Level 3		Unobservable inputs that cannot be corroborated by observable market data

Schedule of assets and liabilities measured at fair value on a recurring basis

The following table summarizes the Company’s financial assets and liabilities measured at fair value by hierarchy level on a recurring basis as of the dates indicated:



	JULY 1, 2018						DECEMBER 31, 2017
(dollars in thousands)	TOTAL		LEVEL 1		LEVEL 2		TOTAL		LEVEL 1		LEVEL 2
Assets:
Cash equivalents:
Fixed income funds	$	5,360	$	5,360	$	—	$	1,830	$	1,830	$	—
Money market funds	10,367		10,367		—		24,656		24,656		—
Restricted cash equivalents:
Money market funds	4,521		4,521		—		1,280		1,280		—
Other current assets, net
Derivative instruments - interest rate swaps	1,162		—		1,162		—		—		—
Other assets, net:
Derivative instruments - interest rate swaps	—		—		—		67		—		67
Total asset recurring fair value measurements	$	21,410	$	20,248	$	1,162	$	27,833	$	27,766	$	67

Liabilities:
Accrued and other current liabilities:
Derivative instruments - interest rate swaps	$	—	$	—	$	—	$	1,010	$	—	$	1,010
Total liability recurring fair value measurements	$	—	$	—	$	—	$	1,010	$	—	$	1,010

Fair value, assets measured on recurring basis, methods and assumptions

Fair value of each class of financial instrument is determined based on the following:



FINANCIAL INSTRUMENT		METHODS AND ASSUMPTIONS
Fixed income funds and Money market funds		Carrying value approximates fair value because maturities are less than three months.
Derivative instruments		The Company’s derivative instruments include interest rate swaps. Fair value measurements are based on the contractual terms of the derivatives and use observable market-based inputs. The interest rate swaps are valued using a discounted cash flow analysis on the expected cash flows of each derivative using observable inputs including interest rate curves and credit spreads. The Company also considers its own nonperformance risk and the respective counterparty’s nonperformance risk when performing fair value measurements. As of July 1, 2018 and December 31, 2017, the Company has determined that the credit valuation adjustments are not significant to the overall valuation of its derivatives.

Fair value, assets and liabilities measured on a nonrecurring basis

The following table summarizes the Company’s assets measured at fair value by hierarchy level on a nonrecurring basis:



	THIRTEEN WEEKS ENDED				TWENTY-SIX WEEKS ENDED
	JULY 1, 2018				JULY 1, 2018
(dollars in thousands)	CARRYING VALUE (1)		TOTAL IMPAIRMENT		CARRYING VALUE (1)		TOTAL IMPAIRMENT
Assets held for sale	$	—	$	—	$	50	$	50
Property, fixtures and equipment	1,060		4,721		1,380		6,942
	$	1,060	$	4,721	$	1,430	$	6,992

	THIRTEEN WEEKS ENDED				TWENTY-SIX WEEKS ENDED
	JUNE 25, 2017				JUNE 25, 2017
(dollars in thousands)	CARRYING VALUE (1)		TOTAL IMPAIRMENT		CARRYING VALUE (1)		TOTAL IMPAIRMENT
Assets held for sale	$	—	$	—	$	400	$	70
Property, fixtures and equipment	—		12		1,067		862
	$	—	$	12	$	1,467	$	932

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(1)	Carrying value approximates fair value with all assets measured using third-party market appraisals or purchase contracts (Level 2).

Schedule of carrying value and fair value of senior secured credit facilities and other unsecured debt

The following table includes the carrying value and fair value of the Company’s debt by hierarchy level as of the dates indicated:



	JULY 1, 2018						DECEMBER 31, 2017
	CARRYING VALUE		FAIR VALUE				CARRYING VALUE		FAIR VALUE
(dollars in thousands)	CARRYING VALUE		LEVEL 2		LEVEL 3		CARRYING VALUE		LEVEL 2		LEVEL 3
Senior Secured Credit Facility:
Term loan A	$	487,500	$	486,281	$	—	$	500,000	$	502,500	$	—
Revolving credit facility	$	633,500	$	631,916	$	—	$	600,000	$	598,500	$	—
Other notes payable	$	141	$	—	$	135	$	904	$	—	$	891