Fair Value Measurements

3 Months Ended

Mar. 30, 2025

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Valuation techniques under the accounting guidance related to fair value measurements are based on observable and unobservable inputs. Observable inputs reflect readily obtainable data from independent sources, while unobservable inputs reflect our market assumptions. These inputs are classified into the following hierarchy:

•Level 1 Inputs - Quoted prices for identical assets or liabilities in active markets.

•Level 2 Inputs - Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable.

•Level 3 Inputs - Pricing inputs are unobservable for the assets or liabilities and include situations where there is little, if any, market activity for the assets or liabilities. The inputs into the determination of fair value require significant management judgment or estimation.

Financial Instruments

The following table presents the carrying amounts and estimated fair values of the Company’s financial instruments:

	March 30, 2025				December 29, 2024
	Carrying Amount		Fair Value		Carrying Amount		Fair Value		Fair Value Measurements
Financial assets
Cash equivalents	$	201,742	$	201,742	$	319,212	$	319,212	Level 1
Other investments in equity securities (a)	—		—		1,718		1,718		Level 2
Financial liabilities
Series 2022-1 Class A-2-I Notes (b)	97,250		91,379		97,500		93,744		Level 2
Series 2022-1 Class A-2-II Notes (b)	385,134		362,438		386,134		371,855		Level 2
Series 2021-1 Class A-2-I Notes (b)	417,644		377,738		418,769		376,256		Level 2
Series 2021-1 Class A-2-II Notes (b)	625,405		538,661		627,030		551,981		Level 2
Series 2019-1 Class A-2-I Notes (b)	352,673		346,060		353,673		345,093		Level 2
Series 2019-1 Class A-2-II Notes (b)	397,498		379,491		398,623		387,039		Level 2
Series 2018-1 Class A-2-II Notes (b)	435,162		419,931		436,349		418,027		Level 2
U.S. advertising fund revolving line of credit	6,500		6,500		—		—		Level 2
7% debentures, due in 2025 (b)	49,084		49,488		48,913		50,034		Level 2

_______________

(a)The fair value of our other investments in equity securities is based on our review of information provided by the investment manager, which is based on observable price changes in orderly transactions for a similar investment of the same issuer.

(b)The fair values were based on quoted market prices in markets that are not considered active markets.

The carrying amounts of cash, accounts payable and accrued expenses approximate fair value due to the short-term nature of those items. The carrying amounts of accounts and notes receivable, net (both current and non-current) approximate fair value due to the effect of the related allowance for doubtful accounts. Our cash equivalents are the only financial assets measured and recorded at fair value on a recurring basis.

Non-Recurring Fair Value Measurements

Assets and liabilities remeasured to fair value on a non-recurring basis resulted in impairment that we have recorded to “Impairment of long-lived assets” in our condensed consolidated statements of operations.

Total impairment losses may reflect the impact of remeasuring long-lived assets held and used (including land, buildings, leasehold improvements, favorable lease assets and right-of-use assets) to fair value as a result of (1) the deterioration in operating performance of certain Company-operated restaurants and (2) the Company’s decision to lease and/or sublease the land and/or buildings to franchisees in connection with the sale or anticipated sale of restaurants, including any subsequent lease modifications. The fair values of long-lived assets held and used presented in the tables below represent the remaining carrying value and were estimated based on either discounted cash flows of future anticipated lease and sublease income or discounted cash flows of future anticipated Company-operated restaurant performance. Total impairment losses may also include the impact of remeasuring long-lived assets held for sale. The fair values of long-lived assets held for sale presented in the tables below represent the remaining carrying value and were estimated based on current market values. See Note 12 for further information on impairment of our long-lived assets.

			Fair Value Measurements
	March 30, 2025		Level 1		Level 2		Level 3
Held and used	$	6	$	—	$	—	$	6
Held for sale	2,048		—		—		2,048
Total	$	2,054	$	—	$	—	$	2,054

			Fair Value Measurements
	December 29, 2024		Level 1		Level 2		Level 3
Held and used	$	2,391	$	—	$	—	$	2,391
Held for sale	1,558		—		—		1,558
Total	$	3,949	$	—	$	—	$	3,949