Goodwill and Other Intangible Assets and Liabilities

12 Months Ended

Dec. 28, 2016

Goodwill And Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets and Liabilities

4. GOODWILL AND OTHER INTANGIBLE ASSETS AND LIABILITIES

On September 24, 2014, we completed an agreement to sell six company-operated restaurants in the greater San Antonio area to AA Pollo, Inc., resulting in cash proceeds of $5.4 million. Goodwill was decremented by $0.7 million, based on a calculation of the fair value of the restaurants sold relative to the fair value of the portion of the reporting unit retained. We recognized a net gain of $2.7 million on this transaction, which is recorded as a gain on disposition of restaurants in the accompanying statements of income. These six restaurants are now franchised. There have been no impairment losses to goodwill life to date.

Domestic trademarks consist of the following (in thousands):

	December 28, 2016			December 30, 2015
Beginning balance	$	120,700		$	120,700
Accumulated impairment charges		(58,812	)		(58,812	)
Ending balance	$	61,888		$	61,888

Other intangible assets subject to amortization consist of the following (in thousands):

	December 28, 2016			December 30, 2015
Favorable leasehold interest	$	6,038		$	6,038
Less: accumulated amortization		(5,554	)		(5,400	)
Total favorable leasehold interest, net	$	484		$	638
Unfavorable leasehold interest liability	$	(9,156	)	$	(9,156	)
Less: accumulated amortization		8,144			7,908
Unfavorable leasehold interest liability, net	$	(1,012	)	$	(1,248	)

The estimated net amortization credits (net liability) for the Company’s favorable and unfavorable leasehold interests for each of the five succeeding fiscal years and thereafter is as follows (in thousands):

For the Years Ending	Favorable Leasehold Interest		Unfavorable Leasehold Interest
December 27, 2017	$	106	$	(225	)
December 26, 2018		97		(144	)
December 25, 2019		94		(136	)
December 30, 2020		85		(123	)
December 29, 2021		64		(120	)
Thereafter		38		(264	)
Total	$	484	$	(1,012	)

The aggregate amortization expense for the years ended December 28, 2016, December 30, 2015, and December 31, 2014 was $0.2 million, $0.2 million, and $0.2 million, respectively. The remaining weighted average amortization periods of the favorable leasehold interest and the unfavorable leasehold liability are four years and five years respectively.

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

+ References + Details