Reorganization and Realignment Costs

The following is a summary of the initiatives included in “Reorganization and realignment costs:”



	Three Months Ended				Nine Months Ended
	September 27, 2015		September 28, 2014		September 27, 2015		September 28, 2014
G&A realignment	$	1,461	$	—	$	9,996	$	—
System optimization initiative	4,293		1,389		6,650		17,376
Reorganization and realignment costs	$	5,754	$	1,389	$	16,646	$	17,376

G&A Realignment

In November 2014, the Company initiated a plan to reduce its general and administrative expenses. The plan includes a realignment and reinvestment of resources to focus primarily on accelerated restaurant development and consumer-facing restaurant technology to drive long-term growth. The Company expects to achieve the majority of the expense reductions through the realignment of its U.S. field operations and savings at its Restaurant Support Center in Dublin, Ohio, which was substantially completed by the end of the second quarter of 2015. The Company recognized costs totaling $9,996 during the first nine months of 2015 and $22,922 in aggregate since inception. The Company expects to incur additional costs aggregating approximately $3,000 during the remainder of 2015 and 2016, comprised primarily of recruitment and relocation costs for the reinvestment in resources to drive long-term growth.

The following is a summary of the activity recorded as a result of our G&A realignment plan:



	Three Months Ended		Nine Months Ended		Total Incurred Since Inception
	September 27, 2015		September 27, 2015		Total Incurred Since Inception
Severance and related employee costs	$	513	$	3,132	$	15,049
Recruitment and relocation costs	270		1,254		1,463
Other	2		43		131
	785		4,429		16,643
Share-based compensation (a)	676		5,567		6,279
Total G&A realignment	$	1,461	$	9,996	$	22,922

_______________


(a)	Represents incremental share-based compensation resulting from the modification of stock options and performance-based awards in connection with the termination of employees under our G&A realignment plan.

The table below presents a rollforward of our accruals for our G&A realignment plan, which are included in “Accrued expenses and other current liabilities” and “Other liabilities.”



	Balance December 28, 2014		Charges		Payments			Balance September 27, 2015
Severance and related employee costs	$	11,609	$	3,132	$	(9,256	)	$	5,485
Recruitment and relocation costs	149		1,254		(1,238		)	165
Other	5		43		(48		)	—
	$	11,763	$	4,429	$	(10,542	)	$	5,650

System Optimization Initiative

The Company has recognized costs related to its system optimization initiative which includes a shift from company-owned restaurants to franchised restaurants over time, through acquisitions and dispositions, as well as helping to facilitate franchisee-to-franchisee restaurant transfers. In connection with its system optimization initiative, the Company expects to incur additional costs of approximately $10,000 in aggregate during the remainder of 2015 and 2016. Such costs are primarily comprised of accelerated amortization of previously acquired franchise rights related to company-owned restaurants in territories that will be sold to franchisees of approximately $3,000 and professional fees of approximately $7,000.

The following is a summary of the costs recorded as a result of our system optimization initiative:



	Three Months Ended				Nine Months Ended				Total Incurred Since Inception
	September 27, 2015		September 28, 2014		September 27, 2015		September 28, 2014		Total Incurred Since Inception
Severance and related employee costs	$	225	$	715	$	854	$	6,641	$	18,112
Professional fees	242		38		393		3,227		6,206
Other (a)	337		511		292		3,273		4,833
	804		1,264		1,539		13,141		29,151
Accelerated depreciation and amortization (b)	3,489		—		5,111		475		22,525
Share-based compensation (c)	—		125		—		3,760		5,013
Total system optimization initiative	$	4,293	$	1,389	$	6,650	$	17,376	$	56,689

_______________


(a)	The nine months ended September 27, 2015 includes a reversal of an accrual of $210 as a result of a change in estimate.


(b)	Primarily includes accelerated amortization of previously acquired franchise rights related to company-owned restaurants in territories that will be or have been sold in connection with our system optimization initiative.


(c)	Represents incremental share-based compensation resulting from the modification of stock options and performance-based awards in connection with the termination of employees under our system optimization initiative.

The table below presents a rollforward of our accrual for our system optimization initiative, which is included in “Accrued expenses and other current liabilities.”



	Balance December 28, 2014		Charges		Payments			Balance September 27, 2015
Severance and related employee costs	$	2,235	$	854	$	(3,003	)	$	86
Professional fees	146		393		(488		)	51
Other	423		292		(523		)	192
	$	2,804	$	1,539	$	(4,014	)	$	329