Form 10-Q - Quarterly report [Sections 13 or 15(d)]

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)


x			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 29, 2024


o			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 001-38250

FAT Brands Inc.

(Exact name of registrant as specified in its charter)


Delaware						82-1302696
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

9720 Wilshire Blvd., Suite 500

Beverly Hills, CA 90212

(Address of principal executive offices, including zip code)

(310) 319-1850

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Class A Common Stock, par value $0.0001 per share

FAT

The Nasdaq Stock Market LLC

Class B Common Stock, par value $0.0001 per share

FATBB

The Nasdaq Stock Market LLC

Series B Cumulative Preferred Stock, par value $0.0001 per share

FATBP

The Nasdaq Stock Market LLC

Warrants to purchase Class A Common Stock

FATBW

The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	o	Accelerated filer	o

Non-accelerated filer	x	Smaller reporting company	x

Emerging growth company	o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Exchange Act Rule 12b-2). Yes o No x

As of October 28, 2024, there were 15,835,800 shares of Class A common stock and 1,270,805 shares of Class B common stock outstanding.

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FAT BRANDS INC.

QUARTERLY REPORT ON FORM 10-Q

September 29, 2024

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PART I.	FINANCIAL INFORMATION (Unaudited)	3
Item 1.	Condensed Consolidated Financial Statements	3

	FAT Brands Inc. and Subsidiaries:
	Condensed Consolidated Balance Sheets	3
	Condensed Consolidated Statements of Operations	5
	Condensed Consolidated Statements of Changes in Stockholders’ Deficit	6
	Condensed Consolidated Statements of Cash Flows	8
	Notes to Condensed Consolidated Financial Statements	9

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	29
Item 4.	Controls and Procedures	29

PART II.	OTHER INFORMATION	29
Item 1.	Legal Proceedings	29
Item 1A.	Risk Factors	30
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	30
Item 3.	Defaults Upon Senior Securities	30
Item 4.	Mine Safety Disclosures	30
Item 5.	Other Information	30
Item 6.	Exhibits	31

SIGNATURE		31

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PART I — FINANCIAL INFORMATION (UNAUDITED)

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FAT BRANDS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)


	September 29, 2024		December 31, 2023
			Audited
Assets
Current assets
Cash	$	16,837	$	37,044
Restricted cash	33,439		39,271
Accounts receivable, net	18,256		21,146
Inventory	8,468		9,306
Assets classified as held-for-sale	370		3,756
Other current assets	14,048		10,486
Total current assets	91,418		121,009
Non-current restricted cash	16,468		15,588
Operating lease right-of-use assets	207,520		220,035
Goodwill	305,054		305,089
Other intangible assets, net	608,458		620,622
Property and equipment, net	104,938		100,524
Other assets	5,779		5,371
Total assets	$	1,339,635	$	1,388,238

Liabilities and Stockholders’ Deficit
Liabilities
Current liabilities
Accounts payable	$	30,054	$	21,809
Accrued expenses and other liabilities	66,708		58,903
Deferred income, current portion	2,300		2,490
Accrued advertising	7,203		7,992
Accrued interest payable	31,723		24,961
Dividend payable on preferred shares	1,358		1,325
Liabilities related to assets classified as held-for-sale	393		3,421
Operating lease liability, current portion	21,499		17,254
Redeemable preferred stock	91,836		91,836
Long-term debt, current portion	49,141		42,611
Acquisition purchase price payable	—		4,000
Total current liabilities	302,215		276,602

Deferred income, net of current portion	20,691		21,958
Deferred income tax liabilities, net	22,556		18,805
Operating lease liability, net of current portion	198,963		211,744
Long-term debt, net of current portion	1,177,921		1,110,308
Other liabilities	3,439		4,684
Total liabilities	1,725,785		1,644,101

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Commitments and contingencies (Note 14)

Stockholders’ deficit
Preferred stock and additional paid-in-capital, $0.0001 par value; 15,000,000 shares authorized; 3,782,459 shares issued and outstanding at September 29, 2024 and 3,591,804 shares issued and outstanding at December 31, 2023; liquidation preference $25 per share	41,106		44,103
Class A common stock and Class B common stock and additional paid-in capital as of September 29, 2024: $0.0001 par value per share; 51,600,000 shares authorized (Class A 50,000,000, Class B 1,600,000); 17,106,468 shares issued and outstanding (Class A 15,835,663, Class B 1,270,805). Common stock and additional paid-in capital as of December 31, 2023: $0.0001 par value; 51,600,000 shares authorized; 16,900,099 shares issued and outstanding (Class A 15,629,294, Class B 1,270,805)	(36,049)		(31,189)
Accumulated deficit	(391,207)		(268,777)
Total stockholders’ deficit	(386,150)		(255,863)
Total liabilities and stockholders’ deficit	$	1,339,635	$	1,388,238

The accompanying notes are an integral part of these condensed consolidated financial statements.

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FAT BRANDS INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share data)


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	September 29, 2024		September 24, 2023		September 29, 2024		September 24, 2023

Revenue
Royalties	$	22,353	$	23,930	$	67,618	$	69,166
Restaurant sales	99,238		62,578		312,587		187,957
Advertising fees	9,708		9,960		29,569		28,979
Factory revenues	9,490		9,323		28,599		28,174
Franchise fees	2,576		2,477		5,170		4,042
Other revenue	—		1,098		3,829		3,503
Total revenue	143,365		109,366		447,372		321,821

Costs and expenses
General and administrative expense	34,481		24,458		94,044		62,820
Cost of restaurant and factory revenues	96,792		59,168		295,955		177,757
Depreciation and amortization	10,736		7,040		31,176		21,217
Refranchising loss	157		408		1,840		746

Advertising fees	10,032		11,671		37,275		33,808
Total costs and expenses	152,198		102,745		460,290		296,348

(Loss) income from operations	(8,833)		6,621		(12,918)		25,473

Other (expense) income, net
Interest expense	(31,109)		(25,319)		(90,318)		(70,417)
Interest expense related to preferred shares	(4,418)		(4,417)		(13,253)		(13,771)
Net gain (loss) on extinguishment of debt	—		(2,723)		427		(2,723)
Other (expense) income, net	(252)		(128)		(800)		137
Total other expense, net	(35,779)		(32,587)		(103,944)		(86,774)

Loss before income tax provision (benefit)	(44,612)		(25,966)		(116,862)		(61,301)

Income tax provision (benefit)	143		(1,310)		5,568		2,572

Net loss	$	(44,755)	$	(24,656)	$	(122,430)	$	(63,873)

Net loss	$	(44,755)	$	(24,656)	$	(122,430)	$	(63,873)
Dividends on preferred shares	(1,935)		(1,794)		(5,736)		(5,175)
	$	(46,690)	$	(26,450)	$	(128,166)	$	(69,048)

Basic and diluted loss per common share	$	(2.74)	$	(1.59)	$	(7.54)	$	(4.17)
Basic and diluted weighted average shares outstanding	17,052,007		16,613,840		16,999,889		16,553,528
Cash dividends declared per common share	$	0.14	$	0.14	$	0.42	$	0.42

The accompanying notes are an integral part of these condensed consolidated financial statements.

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FAT BRANDS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT

(in thousands)

For the Thirty-Nine Weeks Ended September 29, 2024


	Common Stock										Preferred Stock
	Class A Shares	Class B Shares	Class A Par Value		Class B Par Value		Additional Paid-In Capital		Total Common Stock		Shares	Par Value		Additional Paid-In Capital		Total Preferred Stock		Accumulated Deficit		Total

Balance at December 31, 2023	15,629,294	1,270,805	$	2	$	—	$	(31,191)	$	(31,189)	3,591,804	$	—	$	44,103	$	44,103	$	(268,777)	$	(255,863)
Net loss	—	—	—		—		—		—		—	—		—		—		(122,430)		(122,430)
Issuance of common and preferred stock	206,369	—	—		—		322		322		190,655	—		2,739		2,739		—		3,061
Share-based compensation	—	—	—		—		1,961		1,961		—	—		—		—		—		1,961
Dividends paid on common stock	—	—	—		—		(7,143)		(7,143)		—	—		—		—		—		(7,143)

Dividends paid on Series B preferred stock	—	—	—		—		—		—		—	—		(5,736)		(5,736)		—		(5,736)

Balance at September 29, 2024	15,835,663	1,270,805	$	2	$	—	$	(36,051)	$	(36,049)	3,782,459	$	—	$	41,106	$	41,106	$	(391,207)	$	(386,150)

For the Thirty-Nine Weeks Ended September 24, 2023


	Common Stock						Preferred Stock
	Class A Shares	Class B Shares	Class A Par Value		Class B Par Value		Additional Paid-In Capital		Total Common Stock		Shares	Par Value		Additional Paid-In Capital		Total Preferred Stock		Accumulated Deficit		Total

Balance at December 25, 2022	15,300,870	1,270,805	$	2	$	—	$	(26,017)	$	(26,015)	3,252,154	$	—	$	45,504	$	45,504	$	(178,667)	$	(159,178)
Net loss	—	—	—		—		—		—		—	—		—		—		(63,873)		(63,873)
Issuance of common and preferred stock	194,839	—	—		—		348		348		208,098	—		3,469		3,469		—		3,817
Share-based compensation	—	—	—		—		2,668		2,668		—	—		—		—		—		2,668
Dividends paid on common stock	—	—	—		—		(6,980)		(6,980)		—	—		—		—		—		(6,980)

Dividends paid on Series B preferred stock	—	—	—		—		—		—		—	—		(5,175)		(5,175)		—		(5,175)

Balance at September 24, 2023	15,495,709	1,270,805	$	2	$	—	$	(29,981)	$	(29,979)	3,460,252	$	—	$	43,798	$	43,798	$	(242,540)	$	(228,721)

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For the Thirteen Weeks Ended September 29, 2024


	Common Stock										Preferred Stock
	Class A Shares	Class B Shares	Class A Par Value		Class B Par Value		Additional Paid-In Capital		Total Common Stock		Shares	Par Value		Additional Paid-In Capital		Total Preferred Stock		Accumulated Deficit		Total

Balance at June 30, 2024	15,742,515	1,270,805	$	2	$	—	$	(34,422)	$	(34,420)	3,712,883	$	—	$	42,232	$	42,232	$	(346,452)	$	(338,640)
Net loss	—	—	—		—		—		—		—	—		—		—		(44,755)		(44,755)
Issuance of common and preferred stock	93,148	—	—		—		218		218		69,576	—		809		809		—		1,027
Share-based compensation	—	—	—		—		539		539		—	—		—		—		—		539
Dividends paid on common stock	—	—	—		—		(2,386)		(2,386)		—	—		—		—		—		(2,386)

Dividends paid on Series B preferred stock	—	—	—		—		—		—		—	—		(1,935)		(1,935)		—		(1,935)

Balance at September 29, 2024	15,835,663	1,270,805	$	2	$	—	$	(36,051)	$	(36,049)	3,782,459	$	—	$	41,106	$	41,106	$	(391,207)	$	(386,150)

For the Thirteen Weeks Ended September 24, 2023


	Common Stock										Preferred Stock
	Class A Shares	Class B Shares	Class A Par Value		Class B Par Value		Additional Paid-In Capital		Total Common Stock		Shares	Par Value		Additional Paid-In Capital		Total Preferred Stock		Accumulated Deficit		Total

Balance at June 25, 2023	15,340,370	1,270,805	$	2	$	—	$	(28,879)	$	(28,877)	3,338,573	$	—	$	43,566	$	43,566	$	(217,884)	$	(203,195)
Net loss	—	—	—		—		—		—		—	—		—		—		(24,656)		(24,656)
Issuance of common and preferred stock	155,339	—	—		—		139		139		121,679	—		2,026		2,026		—		2,165
Share-based compensation	—	—	—		—		1,096		1,096		—	—		—		—		—		1,096
Dividends paid on common stock	—	—	—		—		(2,337)		(2,337)		—	—		—		—		—		(2,337)
Dividends paid on Series B preferred stock	—	—	—		—		—		—		—	—		(1,794)		(1,794)		—		(1,794)

Balance at September 24, 2023	15,495,709	1,270,805	$	2	$	—	$	(29,981)	$	(29,979)	3,460,252	$	—	$	43,798	$	43,798	$	(242,540)	$	(228,721)

The accompanying notes are an integral part of these condensed consolidated financial statements.

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FAT BRANDS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

For the Thirty-Nine Weeks Ended September 29, 2024 and September 24, 2023


	2024		2023
Cash flows from operating activities:
Net loss	$	(122,430)	$	(63,873)
Adjustments to reconcile net loss to net cash used in operating activities:
Deferred income taxes	3,751		(184)
Depreciation and amortization	31,176		21,217
Share-based compensation	1,961		2,668
Accretion of loan fees and interest	17,036		12,256
Loss on disposal of fixed assets	258		—
Net (gain) loss on extinguishment of debt	(427)		2,723
Provision for bad debts	787		(1,437)

Change in:
Accounts receivable	2,104		13,491
Inventory	838		90
Other current and noncurrent assets	(4,217)		(858)
Operating lease assets and liabilities	3,581		287
Deferred income	(1,457)		(681)
Accounts payable	8,246		89
Accrued expenses and other liabilities	7,793		369
Accrued advertising	(789)		(2,799)
Accrued interest payable	6,763		5,944
Other current and noncurrent liabilities	(810)		(12,338)
Total adjustments	76,594		40,837
Net cash used in operating activities	(45,836)		(23,036)

Cash flows from investing activities:
Acquisitions, net of cash acquired	—		(1,140)
Purchases of property and equipment	(22,210)		(13,427)
Payments received on notes receivable	247		218
Payment of acquisition purchase price payable	(4,000)		—

Net cash used in investing activities	(25,963)		(14,349)

Cash flows from financing activities:
Proceeds from borrowings, net of issuance costs	110,879		194,163
Repayments of borrowings	(54,421)		(78,366)

Proceeds from issuance of common and preferred shares	3,061		3,817

Dividends paid on common shares	(7,143)		(6,980)
Dividends paid on preferred shares	(5,736)		(5,175)
Net cash provided by financing activities	46,640		107,459

Net (decrease) increase in cash and restricted cash	(25,159)		70,074
Cash and restricted cash at beginning of the period	91,903		68,763
Cash and restricted cash at end of the period	$	66,744	$	138,837

Supplemental disclosures of cash flow information:
Cash paid for interest	$	88,047	$	80,616
Cash paid for income taxes	$	1,944	$	802

The accompanying notes are an integral part of these condensed consolidated financial statements.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1. ORGANIZATION AND RELATIONSHIPS

Organization and Nature of Business

FAT Brands Inc. (the "Company" or "FAT") is a leading multi-brand restaurant company that develops, markets, acquires and manages quick-service, fast casual, casual dining and polished casual dining restaurant concepts around the world. As of September 29, 2024, the Company owned eighteen restaurant brands: Round Table Pizza, Fatburger, Marble Slab Creamery, Johnny Rockets, Fazoli's, Twin Peaks, Smokey Bones, Great American Cookies, Hot Dog on a Stick, Buffalo’s Cafe & Express, Hurricane Grill & Wings, Pretzelmaker, Elevation Burger, Native Grill & Wings, Yalla Mediterranean and Ponderosa and Bonanza Steakhouses. As of September 29, 2024, the Company had approximately 2,300 locations open and under construction, of which approximately 92% were franchised.

Each franchising subsidiary licenses the right to use its brand name and provides franchisees with operating procedures and methods of merchandising. Upon signing a franchise agreement, the franchisor is committed to provide training, some supervision and assistance and access to operations manuals. As needed, the franchisor will also provide advice and written materials concerning techniques of managing and operating the restaurants.

The Company's operations have historically been comprised primarily of franchising a growing portfolio of restaurant brands. This growth strategy is centered on expanding the footprint of existing brands and acquiring new brands through a centralized management organization which provides substantially all executive leadership, marketing, training and accounting services. As part of these ongoing franchising efforts, the Company will, from time to time, make opportunistic acquisitions of operating restaurants and may convert them to franchise locations. During the refranchising period the Company may operate the restaurants and classifies the operational activities as refranchising gains or losses and the assets and associated liabilities as held-for sale. Through recent acquisitions, the Company also operates "company-owned" restaurant locations of certain brands.

Liquidity

The Company recognized loss from operations of $12.9 million during the thirty-nine weeks ended September 29, 2024 and income from operations of $25.5 million during the thirty-nine weeks ended September 24, 2023. The Company has a history of net losses and an accumulated deficit of $391.2 million as of September 29, 2024. Additionally, the Company had negative working capital of $210.8 million. Of this amount, $91.8 million represents redeemable preferred stock as discussed in Note 10. Since the Company did not deliver the applicable cash proceeds at the related due dates, the amount accrues interest until the payments are completed. The Company had $16.8 million of unrestricted cash at September 29, 2024 and plans on the combination of cash flows from operations, cash on hand, $71.5 million of issued but not sold aggregate principal amount of fixed rate secured notes and $95.0 million aggregate principal amount of repurchased but not re-sold fixed rate secured notes (see Note 9) to be sufficient to cover any working capital requirements for the next twelve months from the date of this report. If the Company does not achieve its operating plan, additional forms of financing may be required through the issuance of debt or equity. Although management believes it will have access to financing, no assurances can be given that such financing will be available on acceptable terms, in a timely manner or at all.

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation – The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Our revenues are derived primarily from two sales channels, franchised restaurants and company-owned locations, which we operate as one reportable segment.

The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America (“GAAP”) for complete financial statements. In the opinion of the Company, all adjustments considered necessary for the fair presentation of the Company’s results of operations, financial position and cash flows for the periods presented have been included and are of a normal, recurring nature. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company's 2023 Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the SEC on March 12, 2024.

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Nature of operations – The Company operates on a 52-week calendar and its fiscal year ends on the last Sunday of the calendar year. Consistent with industry practice, the Company measures its stores’ performance based upon 7-day work weeks. Using the 52-week cycle ensures consistent weekly reporting for operations and ensures that each week has the same days since certain days are more profitable than others. The use of this fiscal year means a 53rd week is added to the fiscal year every 5 or 6 years. In a 52-week year, all four quarters are comprised of 13 weeks. In a 53-week year, one extra week is added to the fourth quarter. Fiscal year 2023 was a 53-week year and 2024 is a 52-week year.

Employee Retention Tax Credits - On March 27, 2020, the U.S. government enacted the Coronavirus Aid Relief and Security Act (the "CARES Act") to provide certain relief as a result of the COVID-19 pandemic. The CARES Act provides tax relief, along with other stimulus measures, including a provision for an Employee Retention Credit ("ERC"). As there is no authoritative guidance under U.S. GAAP on accounting for government assistance to for-profit business entities, the Company accounts for the ERC by analogy to International Accounting Standard, Accounting for Government Grants and Disclosure of Government Assistance ("IAS 20"). During the thirteen weeks ended September 29, 2024 and September 24, 2023, the Company received and recognized $1.3 million and $1.0 million, respectively, of ERCs recorded within general and administrative expense on the consolidated statements of operations. During the thirty-nine weeks ended September 29, 2024 and September 24, 2023, the Company received and recognized $3.4 million and $13.7 million, respectively, of ERCs recorded within general and administrative expense on the consolidated statements of operations.

Use of estimates in the preparation of the condensed consolidated financial statements – The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements. Significant estimates include the determination of fair values of goodwill and other intangible assets, allowances for uncollectible notes receivable and accounts receivable, and the valuation allowance related to deferred tax assets. Estimates and assumptions also affect the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Recently Issued Accounting Standards Not Yet Adopted

In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The amendments improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The amendments require that a public entity disclose, on an annual and interim basis, an amount for other segment items by reportable segment and a description of its composition. The other segment items category is the difference between segment revenue less the segment expenses disclosed under the significant expense principle and each reported measure of segment profit or loss. The amendments improve financial reporting by requiring disclosure of incremental segment information on an annual and interim basis for all public entities. The amendments are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. A public entity should apply the amendments retrospectively to all prior periods presented in the financial statements. Upon transition, the segment expense categories and amounts disclosed in the prior periods should be based on the significant segment expense categories identified and disclosed in the period of adoption. The Company is currently evaluating the impact the adoption of this standard will have on its condensed consolidated financial statements.

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The amendments require that public business entities on an annual basis disclose specific categories in the rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold. The amendments also require that all entities disclose on an annual basis the income taxes paid disaggregated by jurisdiction. The amendments eliminate the requirement for all entities to disclose the nature and estimate of the range of the reasonably possible change in the unrecognized tax benefits balance in the next 12 months or make a statement that an estimate of the range cannot be made. The amendments are effective for annual periods beginning after December 15, 2024. Early adoption is permitted. The amendments should be applied on a prospective basis. Retrospective application is permitted. The Company is currently evaluating the impact the adoption of this standard will have on its condensed consolidated financial statements.

NOTE 3. MERGERS AND ACQUISITIONS

Acquisition of Barbeque Integrated, Inc.

On September 25, 2023, the Company completed the acquisition of Barbeque Integrated, Inc. from Barbeque Holding LLC. Barbeque Integrated Inc. ("Smokey Bones") is the operator of a chain of barbeque restaurants located in the Eastern and Midwest United States. The net purchase price was $31.3 million after final working capital adjustments.

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The preliminary assessment of the fair value of the net assets and liabilities acquired by the Company through the transaction was $31.3 million. The allocation of the consideration to the net tangible and intangible assets acquired is presented in the table below (in millions):


Cash	$	0.3
Accounts receivable, net of allowance	2.8
Inventory	2.6
Prepaids and other current assets	1.5
Other intangible assets, net	8.8
Goodwill	11.7
Operating lease right-of-use assets	108.9
Other assets	1.8
Property and equipment, net	18.1
Below market leases	0.2
Accounts payable	(3.6)
Accrued expenses and other liabilities	(9.9)

Operating lease liability, current portion	(3.9)
Operating lease liability, net of current portion	(105.6)

Other liabilities	(2.4)
Total net identifiable assets	$	31.3

The identifiable intangible assets acquired in connection with the transaction are based on valuations performed by management and third-party experts. Identifiable intangible assets totaled $8.8 million in trademarks.

Pro Forma Information

The table below presents the combined pro forma revenue and net loss of the Company and Barbeque Integrated Inc. for the thirteen and thirty-nine weeks ended September 24, 2023, respectively, assuming the acquisition had occurred on December 27, 2022 (the beginning of the Company’s 2023 fiscal year) (in millions). This pro forma information does not purport to represent what the actual results of operations of the Company would have been had the acquisition of Barbeque Integrated Inc. occurred on this date nor does it purport to predict the results of operations for future periods.


	Thirteen Weeks Ended		Thirty-Nine Weeks Ended
	September 24, 2023
Revenue	$	146.8	$	451.5
Net loss	$	(15.8)	$	(54.7)

NOTE 4. REFRANCHISING

As part of its ongoing franchising efforts, the Company may, from time to time, sell operating restaurants built or acquired by the Company in order to convert them to franchise locations or acquire existing franchised locations to resell them to another franchisee across all of its brands.

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The following assets used in the operation of certain restaurants meet all of the criteria requiring that they be classified as held-for-sale, and have been classified accordingly in the accompanying condensed consolidated balance sheets as of September 29, 2024 and December 31, 2023 (in millions):


	September 29, 2024		December 31, 2023

Property and equipment	$	—	$	0.7
Operating lease right-of-use assets	0.4		3.1
Total	$	0.4	$	3.8

Operating lease liabilities related to the assets classified as held-for-sale in the amount of $0.4 million and $3.4 million have been classified as current liabilities in the accompanying condensed consolidated balance sheets as of September 29, 2024 and December 31, 2023, respectively.

The following table highlights the operating results of the Company's refranchising program (in millions):


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	September 29, 2024		September 24, 2023		September 29, 2024		September 24, 2023
Restaurant costs and expenses, net of revenue	$	0.2	$	0.4	$	0.8	$	0.8
Loss (gain) on store sales or closures	—		—		1.0		(0.1)

Refranchising loss	$	0.2	$	0.4	$	1.8	$	0.7

NOTE 5. PROPERTY AND EQUIPMENT, NET

Property and equipment, net consists of the following (in millions):


	September 29, 2024		December 31, 2023
Real estate	$	93.3	$	83.5
Equipment	56.2		44.9
	149.5		128.4
Accumulated depreciation	(44.6)		(27.9)
Property and equipment, net	$	104.9	$	100.5

Depreciation expense during the thirteen weeks ended September 29, 2024 and September 24, 2023 was $5.9 million and $3.2 million, respectively. Depreciation expense during the thirty-nine weeks ended September 29, 2024 and September 24, 2023 was $17.5 million and $9.9 million, respectively.

Upon retirement or other disposal of property and equipment, the cost and related amounts of accumulated depreciation are eliminated from the asset and accumulated depreciation accounts, respectively. The difference, if any, between the net asset value and the proceeds, is recorded in earnings. Loss on disposals during the thirty-nine weeks ended September 29, 2024 and September 24, 2023 was $0.3 million and $0, respectively.

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NOTE 6. GOODWILL AND OTHER INTANGIBLE ASSETS, NET

Changes in Carrying Value of Goodwill and Other Intangible Assets (in millions)


	Amortizing Intangible Assets		Non-Amortizing Intangible Assets
			Goodwill		Trademarks
December 31, 2023	$	157.9	$	305.1	$	462.7
Amortization	(12.1)		—		—

September 29, 2024	$	145.8	$	305.1	$	462.7

Gross Carrying Value and Accumulated Amortization of Other Intangible Assets (in millions)


	September 29, 2024							December 31, 2023
		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Amortizing intangible assets
Franchise agreements		$	118.3	$	(31.0)	$	87.3	$	109.5	$	(24.2)	$	85.3
Customer relationships		73.9		(18.2)		55.7		73.9		(13.7)		60.2
Other		4.1		(1.3)		2.8		12.9		(0.5)		12.4
		$	196.3	$	(50.5)	$	145.8	$	196.3	$	(38.4)	$	157.9

Non-amortizing intangible assets
Trademarks						462.7						462.7
Total amortizing and non-amortizing intangible assets, net						$	608.5					$	620.6

Amortization expense for the thirteen weeks ended September 29, 2024 and September 24, 2023 was $4.3 million and $3.8 million, respectively. Amortization expense for the thirty-nine weeks ended September 29, 2024 and September 24, 2023 was $12.1 million and $11.3 million, respectively.

The expected future amortization of definite-life intangible assets by fiscal year (in millions):


Fiscal Year:
Remainder of 2024	$	3.8
2025	15.6
2026	15.6
2027	15.6
2028	15.9
Thereafter	79.3
Total	$	145.8

NOTE 7. INCOME TAXES

The following table presents the Company’s provision for income taxes (in millions):


	Thirteen Weeks Ended						Thirty-Nine Weeks Ended
	September 29, 2024			September 24, 2023			September 29, 2024			September 24, 2023
Provision (benefit) for income taxes	$	0.1		$	(1.3)		$	5.6		$	2.6
Effective tax rate	(0.3)		%	5.0		%	(4.8)		%	(4.2)		%

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The difference between the statutory tax rate of 21% and the effective tax rates of (0.3)% and (4.8)% in the thirteen and thirty-nine weeks ended September 29, 2024, respectively, was primarily due to increases in the valuation allowance, nondeductible expenses and the impact of state income taxes.

The difference between the statutory tax rate of 21% and the effective tax rates of 5.0% and (4.2)% in the thirteen and thirty-nine weeks ended September 24, 2023, respectively, was primarily due to increases in the valuation allowance, nondeductible expenses and the impact of state income taxes.

NOTE 8. LEASES

The Company recognized lease expense of $8.0 million and $4.6 million for the thirteen weeks ended September 29, 2024 and September 24, 2023, respectively. The Company recognized lease expense of $24.0 million and $14.1 million for the thirty-nine weeks ended September 29, 2024 and September 24, 2023, respectively.

Operating lease right-of-use assets and operating lease liabilities relating to the operating leases are as follows (in millions):


	September 29, 2024		December 31, 2023

Operating lease right-of-use assets	$	207.5	$	220.0
Right-of-use assets classified as held-for-sale	0.4		3.1
Total right-of-use assets	$	207.9	$	223.1

Operating lease liabilities	$	220.5	$	229.0
Lease liabilities related to assets held-for-sale	0.4		3.4
Total operating lease liabilities	$	220.9	$	232.4

The contractual future maturities of the Company’s operating lease liabilities as of September 29, 2024, including anticipated lease extensions, are as follows (in millions):


Fiscal year:
Remainder of 2024	$	12.2
2025	30.6
2026	27.5
2027	27.2
2028	26.2
Thereafter	346.0
Total lease payments	$	469.7
Less: imputed interest	(248.8)
Total	$	220.9

The current portion of the operating lease liability as of September 29, 2024 was $21.5 million.

Supplemental cash flow information for the thirty-nine weeks ended September 29, 2024 related to leases was as follows (in millions):


	Thirty-Nine Weeks Ended
	September 29, 2024		September 24, 2023
Cash paid for amounts included in the measurement of operating lease liabilities:
Operating cash flows from operating leases	$	22.4	$	12.9

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NOTE 9. DEBT

Long-term debt consisted of the following (in millions):


	September 29, 2024								December 31, 2023
	Final Maturity	Anticipated Call Date	Rate		Face Value		Book Value		Book Value
Senior Debt
FB Royalty Securitization	4/25/2051	7/25/2026	4.75	%	$	137.0	$	134.7	$	135.9
GFG Royalty Securitization	7/25/2051	7/25/2026	6.00	%	271.2		265.9		267.7
Twin Peaks Securitization	7/25/2051	1/25/2025	7.00	%	243.7		241.5		193.7
Fazoli's/Native Securitization	7/25/2051	1/25/2025	6.00	%	126.2		125.6		126.0
FB Resid Securitization	7/25/2027		10.00	%	50.9		50.7		52.7
Senior Subordinated Debt
FB Royalty Securitization	4/25/2051	7/25/2026	8.00	%	45.7		42.5		42.1
GFG Royalty Securitization	7/25/2051	7/25/2026	7.00	%	102.2		99.0		95.9
Twin Peaks Securitization	7/25/2051	1/25/2025	9.00	%	49.0		48.6		48.6
Fazoli's/Native Securitization	7/25/2051	1/25/2025	7.00	%	24.5		23.9		17.4
FB Resid Securitization	7/25/2027		10.00	%	52.9		52.7		52.7
Subordinated Debt
FB Royalty Securitization	4/25/2051	7/25/2026	9.00	%	15.8		15.5		18.6
GFG Royalty Securitization	7/25/2051	7/25/2026	9.50	%	44.8		43.4		43.4
Twin Peaks Securitization	7/25/2051	1/25/2025	10.00	%	71.1		69.1		29.4
Fazoli's/Native Securitization	7/25/2051	1/25/2025	9.00	%	—		0.1		20.7
Total Securitized Debt					1,235.0		1,213.2		1,144.8
Elevation Note	7/19/2026	N/A	6.00	%	2.5		2.2		3.0
Twin Peaks Equipment Notes	5/5/2027 to 7/31/2028	N/A	7.99% to 11.50%		4.7		4.7		1.9


Twin Peaks Construction Loan III	12/28/2024	N/A	Prime + 1%		3.6		3.6		2.2
Twin Peaks Construction Loan IV	10/1/2025	N/A	12.5	%	3.2		3.2		—
Twin Peaks Promissory Note	10/4/2024	N/A	5.30	%	0.1		0.1		1.0

Total Debt					$	1,249.1	1,227.0		1,152.9
Current portion of long-term debt							(49.1)		(42.6)
Long-term Debt							$	1,177.9	$	1,110.3

Terms of Outstanding Debt

FB Royalty Securitization

On April 26, 2021, FAT Brands Royalty I, LLC ("FB Royalty"), a special purpose, wholly-owned subsidiary of FAT Brands Inc., completed the issuance and sale of three tranches of fixed rate secured notes with a total aggregate principal amount of $144.5 million.

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On July 6, 2022, FB Royalty issued an additional $76.5 million aggregate principal amount of three tranches of fixed rate secured notes. Of the $76.5 million aggregate principal amount, $30.0 million was sold privately during the third quarter of 2022, resulting in net proceeds of $27.1 million (net of debt offering costs of $0.6 million and original issue discount of $2.3 million). The remaining $46.5 million in aggregate principal was sold privately on October 21, 2022, when the Company entered into an Exchange Agreement with the Twin Peaks sellers and redeemed 1,821,831 shares of the Company's 8.25% Series B Cumulative Preferred Stock at a price of $23.69 per share, plus accrued and unpaid dividends to the date of redemption, in exchange for $46.5 million aggregate principal amount of secured debt ($43.2 million net of debt offering costs and original issue discount) as discussed in Note 10.

Prior to the redemption, the Twin Peaks sellers held 2,847,393 shares of Series B Cumulative Preferred Stock.

Pursuant to the Exchange Agreement, (i) at any time prior to July 25, 2023, the Company may call from the Twin Peaks sellers all or a portion of the Class M-2 Notes at the outstanding principal balance multiplied by 0.86, plus any accrued plus unpaid interest thereon; (ii) at any time on or after the date of the Exchange Agreement, the Company may call from the Twin Peaks sellers, and at any time on or after July 25, 2023, the Twin Peaks sellers may put to the Company, all or a portion of the Class A-2 Notes and/or Class B-2 Notes at the outstanding principal balance multiplied by 0.94, plus any accrued plus unpaid interest thereon; and (iii) at any time on or after July 25, 2023, the Company may call from the Twin Peaks sellers, and the Twin Peaks sellers may put to the Company, all or a portion of the Class M-2 Notes at the outstanding principal balance multiplied by 0.91, plus any accrued plus unpaid interest thereon. If the Company does not remit the applicable call price or put price upon a duly exercised call or put, as applicable, the amount owed by the Company will accrue interest at 10% per annum, which interest is due and payable in cash monthly by the Company. On July 13, 2023, pursuant to the Exchange Agreement, the Twin Peaks sellers exercised their put option. During the first quarter of 2024, the Company paid $1.0 million to settle the 10% per annum interest in perpetuity and to settle the put option. As a result, as of September 29, 2024, the outstanding principal balance owned by the Twin Peaks sellers is no longer subject to the put option.

The FB Royalty securitization notes are generally secured by a security interest in substantially all the assets of FB Royalty and its subsidiaries.

GFG Royalty Securitization

In connection with the acquisition of GFG, on July 22, 2021, FAT Brands GFG Royalty I, LLC ("GFG Royalty"), a special purpose, wholly-owned subsidiary of FAT Brands, completed the issuance and sale in a private offering of three tranches of fixed rate secured notes with a total aggregate principal amount of $350.0 million. Immediately following the closing of the acquisition of GFG the Company contributed the franchising subsidiaries of GFG to GFG Royalty, pursuant to a Contribution Agreement.

On December 15, 2022, GFG Royalty issued an additional $113.5 million aggregate principal amount of three tranches of fixed rate secured notes. Of the $113.5 million aggregate principal amount, $25.0 million was sold privately during the fourth quarter of 2022. In January 2023, an additional $40.0 million aggregate principal amount was sold privately, resulting in net proceeds of $34.8 million. On September 20, 2023, an additional $2.8 million aggregate principal amount was sold privately resulting in net proceeds of $2.5 million. In October 2023, $20.2 million aggregate principal amount previously issued to FAT Brands Inc. was sold privately resulting in net proceeds of $18.1 million. The remaining $25.3 million in aggregate principal amount remains issued to FAT Brands, Inc., pending sale to third party investors.

The GFG Royalty securitization notes are generally secured by a security interest in substantially all the assets of GFG Royalty and its subsidiaries.

Twin Peaks Securitization

In connection with the acquisition of Twin Peaks on October 1, 2021, the Company completed the issuance and sale in a private offering through its special purpose, wholly-owned subsidiary, FAT Brands Twin Peaks I, LLC, of three tranches of fixed rate secured notes with a total aggregate principal amount of $250.0 million. Immediately following the closing of the acquisition of Twin Peaks the Company contributed the franchising subsidiaries of Twin Peaks to FAT Brands Twin Peaks I, LLC, pursuant to a Contribution Agreement.

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On September 8, 2023, FAT Brands Twin Peaks I, LLC issued an additional $98.0 million aggregate principal amount of two tranches of fixed rate secured notes to FAT Brands Inc., pending sale to third party investors. Of the $98.0 million aggregate principal amount, $48.0 million was sold privately during the third quarter of 2023 resulting in net proceeds of $45.2 million. A portion of the proceeds was used to purchase $14.9 million aggregate principal amount of outstanding Securitization Notes, which will be held pending re-sale to third party investors. The remaining $50.0 million in aggregate principal of notes issued by FAT Twin Peaks I, LLC was issued to a wholly-owned subsidiary of FAT Brands, Inc., pending sale to third party investors.

On March 20, 2024, FAT Brands Twin Peaks I, LLC issued an additional $50.0 million aggregate principal amount of one tranche of fixed rate secured notes to FAT Brands Inc., pending sale to third party investors. Of the $50.0 million aggregate principal amount, $38.8 million was sold privately during the first quarter of 2024 resulting in net proceeds of $36.4 million. A portion of the proceeds was used to purchase $7.4 million aggregate principal amount of outstanding Securitization Notes, which will be held pending re-sale to third party investors. In connection with the bonds repurchased, the Company recognized a $0.4 million net gain on extinguishment of debt. During the second quarter of 2024, the remaining $11.2 million in aggregate principal of notes was sold privately to a third party investor resulting in net proceeds of $10.7 million.

The Twin Peaks securitization notes are generally secured by a security interest in substantially all the assets of FAT Brands Twin Peaks I, LLC and its subsidiaries.

Fazoli's / Native Securitization

In connection with the acquisition of Fazoli's and Native Grill & Wings on December 15, 2021, the Company completed the issuance and sale in a private offering through its special purpose, wholly-owned subsidiary, FAT Brands Fazoli's Native I, LLC, of three tranches of fixed rate secured notes with a total aggregate principal amount of $193.8 million. Immediately following the closing of the acquisition of Fazoli's and Native the Company contributed the franchising subsidiaries of these entities to FAT Brands Fazoli's Native I, LLC, pursuant to a Contribution Agreement.

The Fazoli's/Native securitization notes are generally secured by a security interest in substantially all the assets of FAT Brands Fazoli's Native I, LLC and its subsidiaries.

FB Resid Holdings 1, LLC

On July 8, 2023, FB Resid Holdings I, LLC (“FB Resid”), a special purpose, wholly-owned subsidiary of FAT Brands, completed the issuance of two tranches of fixed rate secured notes with a total aggregate principal amount of $150.0 million. Of the $150.0 million aggregate principal amount, $105.8 million was sold privately in 2023, resulting in net proceeds of $105.3 million. A portion of the proceeds was used to purchase $64.6 million of outstanding Securitization Notes, which will be held pending re-sale to third party investors. The remaining $44.2 million in aggregate principal of notes issued by FB Resid was issued to a wholly-owned subsidiary of FAT Brands, Inc., pending sale to third party investors.

Retained Notes

During the thirty-nine weeks ended September 29, 2024, the Company repurchased certain of its securitized notes to be held for resale to third party investors and sold certain of its securitized notes previously repurchased or issued and not sold (collectively, the "Retained Notes"). During the thirty-nine weeks ended September 29, 2024, cash proceeds from the sale of Retained Notes and cash used to repurchase Retained Notes was $102.2 million and $32.4 million including accrued interest, respectively. The $102.2 million includes the sale of $50.0 million aggregate principal Twin Peaks Securitization notes issued in 2024 in addition to securitization notes previously held in wholly-owned subsidiaries of Fat Brands Inc. As of September 29, 2024, the Company held $166.5 million of Retained Notes, which have been eliminated in consolidation.

Terms and Debt Covenant Compliance

The FAT Royalty securitization notes, the GFG Royalty securitization notes, the Twin Peaks securitization notes, the Fazoli's/Native securitization notes and the FB Resid notes (collectively, the "Securitization Notes") require that the principal (if any) and interest obligations be segregated to ensure appropriate funds are reserved to pay the quarterly principal and interest amounts due. The amount of monthly cash flow that exceeds the required monthly interest reserve is generally remitted to the Company. Interest payments are required to be made on a quarterly basis. Beginning July 26, 2023, additional interest equal to 1.0% per annum and principal payments equal to 2.0% per annum of the initial principal amount on the FAT Royalty securitization notes, the GFG Royalty securitization notes, the Twin Peaks securitization notes and the Fazoli's/Native securitization notes will be made on the scheduled quarterly payment dates.

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The material terms of the Securitization Notes contain covenants which are standard and customary for these types of agreements, including the following financial covenants: (i) debt service coverage ratio, (ii) leverage ratio and (iii) senior leverage ratio. As of September 29, 2024, the Company was in compliance with these covenants.

Elevation Note

On June 19, 2019, the Company completed the acquisition of Elevation Burger. A portion of the purchase price included the issuance to the Seller of a convertible subordinated promissory note (the “Elevation Note”) with a principal amount of $7.5 million, bearing interest at 6.0% per annum and maturing in July 2026. The Elevation Note is convertible, under certain circumstances, into shares of the Company’s common stock at $12.00 per share.

The Elevation Note is a general unsecured obligation of Company and is subordinated in right of payment to all indebtedness of the Company arising under any agreement or instrument to which Company or any of its Affiliates is a party that evidences indebtedness for borrowed money that is senior in right of payment.

Equipment Financings (Twin Peaks)

During 2022, one of our wholly-owned subsidiaries entered into certain equipment financing arrangements to borrow up to $1.4 million, the proceeds of which were used to purchase certain equipment for a company-owned restaurant that opened in 2022 and to retrofit certain existing company-owned restaurants with equipment (which we refer to as the "2022 Equipment Financings"). The 2022 Equipment Financings have maturity dates between May 5, 2027 and March 7, 2028 and bear interest at fixed rates between 7.99% and 8.49% per annum.

During 2023, one of our wholly-owned subsidiaries entered into certain equipment financing arrangements to borrow up to $1.4 million, the proceeds of which will be used to purchase certain equipment for a new company-owned restaurant (which we refer to as the "2023 Equipment Financing"). The 2023 Equipment Financing has maturity dates that are 48 months from the date of each draw, and bears interest at 11.5% per annum.

During 2024, one of our wholly-owned subsidiaries entered into certain equipment financing arrangements to borrow up to $4.2 million, the proceeds of which will be used to purchase certain equipment for three new company-owned Twin Peaks restaurants (which we refer to as the "2024 Equipment Financing"). The 2024 Equipment Financing has maturity dates that are 48 months from the date of each draw, and bears interest at 11.5% per annum.

The 2022 Equipment Financings, the 2023 Equipment Financing, and the 2024 Equipment Financing are secured by certain equipment of such respective company-owned restaurants. As of September 29, 2024, the total outstanding principal amount under them on a collective basis was $4.7 million, and as of December 31, 2023, the total outstanding principal amount was $1.9 million.

Construction Loan Agreement (Twin Peaks)

On December 28, 2023, an indirect subsidiary of the Company entered into a construction loan agreement to borrow up to $4.75 million, the proceeds of which will be used for a new corporate Twin Peaks in McKinney, TX (the "Construction Loan III"). The Construction Loan III has an initial maturity of December 28, 2024, with an optional 12-month extension, bearing interest at Wall Street Journal Prime plus 100 basis per year and is secured by land and building. As of September 29, 2024, the total amount outstanding on the Construction Loan III was $3.6 million. The Construction Loan III was paid in full during the fourth quarter of 2024.

On September 20, 2024, an indirect subsidiary of the Company entered into a loan agreement to borrow $3.2 million with an initial maturity of October 1, 2025, bearing interest at 12.5% per annum and is secured by land and building of a new corporate restaurant. As of September 29, 2024, the total amount outstanding on this loan was $3.2 million.

Promissory Note (Twin Peaks)

On December 4, 2023, an indirect subsidiary of the Company purchased all member interest units of a joint venture entity for $1.3 million in the form of a $0.3 million cash payment and 10 equal monthly payments of $0.1 million beginning in January 2024. The $1.0 million promissory note bears interest of 5.3% and has a maturity of October 4, 2024. As of September 29, 2024, the total outstanding amount on the promissory note was $0.1 million. This promissory note was paid in full on its maturity date.

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NOTE 10. REDEEMABLE PREFERRED STOCK

GFG Preferred Stock Consideration

On July 22, 2021, the Company completed the acquisition of GFG. A portion of the consideration paid included 3,089,245 newly issued shares of the Company’s Series B Cumulative Preferred Stock valued at $67.3 million (the "GFG Preferred Stock Consideration"). Additionally, on July 22, 2021, the Company entered into a put/call agreement with the GFG sellers, pursuant to which the Company may purchase, or the GFG Sellers may require the Company to purchase, the GFG Preferred Stock Consideration for $67.5 million plus any accrued but unpaid dividends on or before August 20, 2022 (extended from the original date of April 22, 2022), subject to the other provisions of the Put/Call Agreement. Since the Company did not deliver the applicable cash proceeds to the GFG Sellers by that date, the amount accrues interest at the rate of 5% per annum until repayment is completed. On March 22, 2022, the Company received a put notice on the GFG Preferred Stock Consideration and reclassified the GFG Preferred Stock Consideration from redeemable preferred stock to current liabilities on its consolidated balance sheet. As of September 29, 2024, the carrying value of the redeemable preferred stock was $67.5 million.

On September 16, 2022, the Company entered into an agreement with one of the GFG sellers who held 1,544,623 put preferred shares. Pursuant to the agreement, effective August 23, 2022, the interest rate applicable to such holder's 1,544,623 put shares was increased from 5% to 10% per annum, payable monthly in arrears. During the thirteen and thirty-nine weeks ended September 29, 2024 the Company paid $0.9 million and $2.5 million of interest.

On March 9, 2023, the Company entered into an agreement with the second GFG seller who held 1,544,623 put preferred shares. Pursuant to the agreement, effective August 23, 2022, the interest rate applicable to such holder's 1,544,623 put shares was increased from 5% to 10% per annum, payable on the date of redemption.

Twin Peaks Preferred Stock Consideration

On October 1, 2021, the Company completed the acquisition of Twin Peaks. A portion of the consideration paid included 2,847,393 shares of the Company’s 8.25% Series B Cumulative Preferred Stock (the "Twin Peaks Preferred Stock Consideration") valued at $67.5 million.

On October 1, 2021, the Company and the Twin Peaks Seller entered into a Put/Call Agreement (the “Put/Call Agreement”) pursuant to which the Company was granted the right to call from the Twin Peaks Seller, and the Twin Peaks Seller was granted the right to put to the Company, the Initial Put/Call Shares at any time until March 31, 2022 for a cash payment of $42.5 million, and the Secondary Put/Call Shares at any time until September 30, 2022 for a cash payment of $25.0 million (the Initial Put/call Shares together with the Secondary Put/Call Shares total $67.5 million), plus any accrued but unpaid dividends on such shares. Unpaid balances, when due, accrue interest at a rate of 10.0% per annum until repayment is completed. On October 7, 2021, the Company received a put notice on the Initial Put/Call Shares and the Secondary Put/Call Shares.

On October 21, 2022, the Company entered into an Exchange Agreement with the Twin Peaks Seller and redeemed 1,821,831 shares of the Company’s 8.25% Series B Cumulative Preferred Stock at a price of $23.69 per share, plus accrued and unpaid dividends to the date of redemption in exchange for $46.5 million aggregate principal amount of secured debt ($43.2 million net of debt offering costs and original issue discount) as discussed in Note 9.

As of September 29, 2024, the carrying value of the Twin Peaks Preferred Stock Consideration totaled $24.3 million. The Company recognized interest expense relating to the Twin Peaks Preferred Stock Consideration for the thirteen and thirty-nine weeks ended September 29, 2024 in the amount of $0.6 million and $1.8 million.

NOTE 11. SHARE-BASED COMPENSATION

Effective September 30, 2017, the Company adopted the 2017 Omnibus Equity Incentive Plan (the “Plan”). The Plan was amended on December 20, 2022 to increase the number of shares available for issuance under the Plan. The Plan is a comprehensive incentive compensation plan under which the Company can grant equity-based and other incentive awards to officers, employees and directors of, and consultants and advisers to, FAT Brands Inc. and its subsidiaries. The Plan provides a maximum of 5,000,000 shares available for grant.

The Company has periodically issued stock options under the Plan. All of the stock options issued by the Company to date have included a vesting period of three years, with one-third of each grant vesting annually. As of September 29, 2024, there were 3,153,199 shares of stock options outstanding with a weighted average exercise price of $9.15.

During the thirty-nine weeks ended September 29, 2024, the Company granted a total of 326,360 stock options under the Plan with a grant date fair value of $0.9 million. These stock options were grated in the first two quarters this year and there were no

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new grants in the third quarter. During the thirteen and thirty-nine weeks ended September 24, 2023, the Company granted a total of 188,180 and 755,087 stock options under the Plan with a grant date fair value of $0.5 million and $1.5 million, respectively. The related compensation expense will be recognized over the vesting period.

The Company recognized share-based compensation expense in the amount of $0.5 million and $1.1 million during the thirteen weeks ended September 29, 2024 and September 24, 2023, respectively. The Company recognized share-based compensation expense in the amount of $2.0 million and $2.7 million during the thirty-nine weeks ended September 29, 2024 and September 24, 2023, respectively. As of September 29, 2024, there remains $1.2 million of related share-based compensation expense relating to non-vested grants, which will be recognized over the remaining vesting period of approximately 2.8 years, subject to future forfeitures.

NOTE 12. WARRANTS

The Company’s warrant activity for the thirty-nine weeks ended September 29, 2024 was as follows:


	Number of Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)
Warrants exercisable at December 31, 2023	1,048,438	$	2.95	1.6

Exercised	(154,259)	$	2.56	1.0
Warrants outstanding and exercisable at September 29, 2024	894,179	$	2.61	0.8

During the thirty-nine weeks ended September 29, 2024, 154,259 warrants were exercised in exchange for 154,259 shares of common stock with net proceeds to the Company of $0.4 million.

NOTE 13. COMMON STOCK

On October 29, 2024, the Board of Directors declared a cash dividend of $0.14 per share of Class A and Class B Common Stock, payable on November 29, 2024 to stockholders of record as of November 15, 2024.

On November 14, 2022, we entered into an ATM Sales Agreement (the "ThinkEquity Sales Agreement") with ThinkEquity LLC (the "Agent"), pursuant to which we may offer and sell from time to time through the Agent up to 21,435,000 maximum aggregate offering price of shares of our Class A Common Stock and/or 8.25% Series B Preferred Stock. The ThinkEquity Sales Agreement with the Agent was terminated in May 2024.

On July 19, 2024, we entered into an Equity Distribution Agreement (the “Noble Sales Agreement”) with Noble Capital Markets, Inc. (the “Sales Agent”), pursuant to which we may offer and sell from time to time through the Sales Agent shares (the “Placement Shares”) of our Class A Common Stock and/or 8.25% Series B Cumulative Preferred Stock. During the three months ended September 29, 2024, pursuant to the Noble Sales Agreement, the Company sold and issued 27,110 shares of Class A Common Stock, at a weighted average share price of $5.25, paid the Sales Agent commissions of $4,270 for such sales and received net proceeds of $137,950 (net of fees and commissions) for such sales. During the three months ended September 29, 2024, pursuant to the Noble Sales Agreement, the Company sold and issued 69,576 shares of 8.25% Series B Cumulative Preferred Stock, at a weighted average share price of $10.81, paid the Sales Agent commissions of $22,565 for such sales and received net proceeds of $729,336 (net of fees and commissions) for such sales.

NOTE 14. COMMITMENTS AND CONTINGENCIES

Government Investigations and Litigation

In December 2021, the U.S. Attorney’s Office for the Central District of California (the “U.S. Attorney”) and the U.S. Securities and Exchange Commission (the “SEC”) informed the Company that they had opened investigations relating to the Company and our former CEO, Andrew Wiederhorn, and were formally seeking documents and materials concerning, among other things, the Company’s December 2020 merger with Fog Cutter Capital Group Inc. (“FCCG”), transactions between those entities and Mr. Wiederhorn, as well as compensation, extensions of credit and other benefits or payments received by Mr. Wiederhorn or his family from those entities prior to the merger.

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On May 10, 2024, the U.S. Department of Justice (“DOJ”) indicted the Company on two violations of Section 402 of the Sarbanes-Oxley Act for directly and indirectly extending and/or arranging for the extension of credit in 2019 and 2020 to former CEO Andrew Wiederhorn in the amount of $2.65 million. These charges allege that the Company, through its subsidiary Fatburger N.A., transferred approximately $600,000 to Mr. Wiederhorn in the form of a personal loan on January 30, 2019, and lent approximately $2 million in 2020 to its former parent company FCCG which indirectly funded a personal loan from FCCG to Mr. Wiederhorn. The indictment also includes charges against Mr. Wiederhorn, the Company’s former CFO, Rebecca Hershinger, and the Company’s former tax advisor, William Amon, on violations of various federal tax and other laws related to loans from FCCG to Mr. Wiederhorn.

Concurrently with the DOJ’s charges, the SEC filed a complaint against the Company, claiming violations of Section 17(a)(2) of the Securities Act of 1933; Sections 10(b), 13(a), 13(b)(2)(A), 13(b)(2)(B), 13(k), and 14(a) of the Securities Exchange Act of 1934; and Rules 10b-5(b), 12b-20, 13a-1, 13a-13, 14a-3, and 14a-9 thereunder. The SEC’s claims pertain principally to allegations that, for fiscal periods covering 2017 through 2020, the Company failed to disclose certain related party transactions, failed to disclose the salaries of Mr. Wiederhorn’s adult children working at the Company, failed to maintain proper books and records and internal accounting controls, made false or misleading statements regarding the Company’s liquidity and use of proceeds from certain transactions, and directly or indirectly extended credit to Mr. Wiederhorn in the form of a personal loan. The SEC’s complaint also names Mr. Wiederhorn, Ms. Hershinger, and the Company’s SVP of Finance, Ron Roe, as defendants. The SEC is seeking injunctive relief, disgorgement, and civil monetary penalties.

The Company is evaluating these charges and intends to vigorously defend itself against them.

Derivative Litigation

James Harris and Adam Vignola, derivatively on behalf of FAT Brands, Inc. v. Squire Junger, James Neuhauser, Edward Rensi, Andrew Wiederhorn, Fog Cutter Holdings, LLC and Fog Cutter Capital Group, Inc., and FAT Brands Inc., nominal defendant (Delaware Chancery Court, Case No. 2021-0511)

On June 10, 2021, plaintiffs James Harris and Adam Vignola (“Plaintiffs”), putative stockholders of the Company, filed a shareholder derivative action in the Delaware Court of Chancery nominally on behalf of the Company against the Company’s current and former directors (Squire Junger, James Neuhauser, Edward Rensi and Andrew Wiederhorn (the “Individual Defendants”)), and the Company’s majority stockholders, Fog Cutter Holdings, LLC and Fog Cutter Capital Group, Inc. (collectively with the Individual Defendants, “Defendants”). Plaintiffs assert claims of breach of fiduciary duty, unjust enrichment and waste of corporate assets arising out of the Company’s December 2020 merger with Fog Cutter Capital Group, Inc. Defendants filed a motion to dismiss Plaintiffs’ complaint, which the Court denied in an oral ruling on February 11, 2022 and subsequent written order on May 25, 2022. On April 7, 2022, the Court entered a Scheduling Order setting forth the key dates and deadlines that would govern the litigation, including a discovery cutoff of March 24, 2023 and trial date of February 5-9, 2024. To date, the parties have engaged in substantial written discovery, though no depositions have been taken. On February 3, 2023, the Company’s board of directors appointed a Special Litigation Committee (“SLC”), which retained independent counsel and moved for a six-month stay of the action pending resolution of the SLC's investigation, which the Court granted on February 17, 2023. On April 5, 2023, the Court granted Plaintiffs’ motion to lift the stay of the proceedings, and entered a Second Amended Pre-Trial Scheduling Order resetting key dates and deadlines, including a fact discovery cutoff of August 4, 2023, and a trial date to be set sometime after May 10, 2024. On May 4, 2023, a new SLC was appointed, and on May 8, 2023, the new SLC moved for a six-month stay of the action pending resolution of its investigation. On May 10, 2023, the United States of America moved for a partial stay of discovery pending its own investigation. On May 31, 2023, the Court granted the United States of America’s Motion, except that it granted a six-month stay of all proceedings in the action, and on that basis deemed the SLC’s motion to be moot. On December 4, 2023, the stay of all proceedings was extended through March 3, 2024, and on March 1, 2024, the stay of all proceedings was extended to June 3, 2024. On June 3, 2024, the Court granted the United States’ request to further extend the stay of all proceedings pending resolution of the charges in United States v. Wiederhorn et al., 2:24-CR-295-RGK (C.D. Cal.). Defendants dispute the allegations of the lawsuit and intend to vigorously defend against the claims. We cannot predict the outcome of this lawsuit. This lawsuit does not assert any claims against the Company. However, subject to certain limitations, we are obligated to indemnify our directors in connection with defense costs for the lawsuit and any related litigation, which may exceed coverage provided under our insurance policies, and thus could have an adverse effect on our financial condition. The lawsuit and any related litigation also may be time-consuming and divert the attention and resources of our management.

James Harris and Adam Vignola, derivatively on behalf of FAT Brands, Inc. v. Squire Junger, James Neuhauser, Edward Rensi, Andrew Wiederhorn and Fog Cutter Holdings, LLC, and FAT Brands Inc., nominal defendant (Delaware Chancery Court, Case No. 2022-0254)

On March 17, 2022, plaintiffs James Harris and Adam Vignola (“Plaintiffs”), putative stockholders of the Company, filed a shareholder derivative action in the Delaware Court of Chancery nominally on behalf of the Company against the Company’s current and former directors (Squire Junger, James Neuhauser, Edward Rensi and Andrew Wiederhorn (the “Individual

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Defendants”)), and the Company’s majority stockholder, Fog Cutter Holdings, LLC (collectively with the Individual Defendants, “Defendants”). Plaintiffs assert claims of breach of fiduciary duty in connection with the Company’s June 2021 recapitalization transaction. On May 27, 2022, Defendants filed a motion to dismiss Plaintiff's complaint (the "Motion"). Argument on the Motion was heard on November 17, 2022, and again on February 23, 2023, and the Court took its decision under advisement. The Court denied the motion on April 5, 2023. On May 2, 2023, the Court entered a pre-trial scheduling order setting key dates and deadlines that will govern the litigation, including a fact discovery cutoff of February 2, 2024, and a trial date to be set sometime after October 15, 2024. On July 21, 2023, the Company’s board of directors appointed a Special Litigation Committee (“SLC”), which retained independent counsel and moved for a six-month stay of the action pending resolution of the SLC’s investigation. On August 10, 2023, the parties filed a stipulation to stay the case for six months, conditioned upon Defendants continuing to review the documents in response to Plaintiffs' First Requests for Production and to produce non-privileged responsive documents to the SLC and to Plaintiffs no later than December 1, 2023. The Court granted the stipulation the same day. In accordance with the stipulation, Defendants produced documents to the SLC and Plaintiffs by the December 1, 2023 deadline. Subsequently, the Court granted multiple stays of the proceedings in this case, currently through November 4, 2024. Defendants dispute the allegations of the lawsuit and intend to vigorously defend against the claims. As this matter is still in the early stages, we cannot predict the outcome of this lawsuit. This lawsuit does not assert any claims against the Company. However, subject to certain limitations, we are obligated to indemnify our directors in connection with defense costs for the lawsuit and any related litigation, which may exceed coverage provided under our insurance policies, and thus could have an adverse effect on our financial condition. The lawsuit and any related litigation also may be time-consuming and divert the attention and resources of our management.

Other Litigation

Mitchell Kates v. FAT Brands, Inc., Andrew Wiederhorn, Kenneth J. Kuick and Robert G. Rosen (United States District Court for the Central District of California, Case No. 2:24-cv-04775-MWF-MAA)

On June 7, 2024, plaintiff Mitchell Kates, a putative investor in the Company, filed a putative class action lawsuit against the Company, Andrew Wiederhorn, Kenneth J. Kuick and Robert G. Rosen, asserting claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended (the “1934 Act”), and Rule 10b-5 promulgated thereunder, alleging that the defendants made false and misleading statements and omitted material facts necessary to make statements not misleading in the Company’s reports filed with the SEC under the 1934 Act related to the subject matter of the government investigations and litigation discussed above, the Company’s handling of these matters and its cooperation with the government. The plaintiff alleges that the Company’s public statements wrongfully inflated the trading price of the Company’s common stock, preferred stock and warrants. The plaintiff is seeking to certify the complaint as a class action and is seeking compensatory damages in an amount to be determined at trial. As this matter is still in the early stages, we cannot predict the outcome of this lawsuit.

Stratford Holding LLC v. Foot Locker Retail Inc. (U.S. District Court for the Western District of Oklahoma, Case No. 5:12-cv-772-HE)

In 2012 and 2013, two property owners in Oklahoma City, Oklahoma sued numerous parties, including Foot Locker Retail Inc. and our subsidiary Fog Cutter Capital Group Inc. (now known as Fog Cutter Acquisition, LLC), for alleged environmental contamination on their properties, stemming from dry cleaning operations on one of the properties. The property owners seek damages in the range of $12.0 million to $22.0 million. From 2002 to 2008, a former Fog Cutter subsidiary managed a lease portfolio, which included the subject property. Fog Cutter denies any liability, although it did not timely respond to one of the property owners’ complaints and several of the defendants’ cross-complaints and thus is in default. The parties are currently conducting discovery. The court has vacated the current trial date and has not yet reset the trial date. The Company is unable to predict the ultimate outcome of this matter, however, reserves have been recorded on the balance sheet of FAT Brands relating to this litigation. There can be no assurance that the defendants will be successful in defending against these actions.

SBN FCCG LLC v FCCGI (Los Angeles Superior Court, Case No. BS172606)

SBN FCCG LLC (“SBN”) filed a complaint against Fog Cutter Capital Group, Inc. (“FCCG”) in New York state court for an indemnification claim (the “NY case”) stemming from an earlier lawsuit in Georgia regarding a certain lease portfolio formerly managed by a former FCCG subsidiary. In February 2018, SBN obtained a final judgment in the NY case for a total of $0.7 million, which included $0.2 million in interest dating back to March 2012. SBN then obtained a sister state judgment in Los Angeles Superior Court, Case No. BS172606 (the “California case”), which included the $0.7 million judgment from the NY case, plus additional statutory interest and fees, for a total judgment of $0.7 million. In May 2018, SBN filed a cost memo, requesting an additional $12,411 in interest to be added to the judgment in the California case, for a total of $0.7 million. In May 2019, the parties agreed to settle the matter for $0.6 million, which required the immediate payment of $0.1 million, and the balance to be paid in August 2019. FCCG wired $0.1 million to SBN in May 2019, but has not yet paid the remaining balance of $0.5 million. The parties have not entered into a formal settlement agreement, and they have not yet discussed the terms for the payment of the remaining balance.

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SBN FCCG LLC v FCCGI (Supreme Court of the State of New York, County of New York, Index No. 650197/2023)

On January 13, 2023, SBN filed another complaint against FCCG in New York state court for an indemnification claim stemming from a lawsuit in Oklahoma City regarding the same lease portfolio formerly managed by Fog Cap (the “OKC Litigation”), and a bankruptcy proceeding involving Fog Cap (the “Bankruptcy Proceeding”). SBN alleges that under a February 2008 stock purchase agreement, Fog Cutter is required to indemnify SBN and its affiliates. According to the complaint, SBN has, at the time of filing the complaint, incurred costs subject to indemnification of approximately $12 million. On March 11, 2024, the court issued an order granting FCCG’s motion to dismiss SBN’s complaint without prejudice to refile the complaint, if at all, once the underlying proceedings (the OKC Litigation and the Bankruptcy Proceeding) were complete. On April 10, 2024, SBN filed a notice of appeal of the trial court's order dismissing SBN's complaint. We are unable at this time to express any opinion as to the eventual outcome of this matter or the possible range of loss, if any.

The Company is involved in other claims and legal proceedings from time-to-time that arise in the ordinary course of business, including those involving the Company’s franchisees. The Company does not believe that the ultimate resolution of these actions will have a material adverse effect on its business, financial condition, results of operations, liquidity or capital resources. As of September 29, 2024, the Company had accrued an aggregate of $5.1 million for the specific matters mentioned above and claims and legal proceedings involving franchisees as of that date.

NOTE 15. GEOGRAPHIC INFORMATION

Revenue by geographic area was as follows (in millions):


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	September 29, 2024		September 24, 2023		September 29, 2024		September 24, 2023
United States	$	140.6	$	106.4	$	440.0	$	314.2
Other countries	2.8		3.0		7.4		7.6
Total revenue	$	143.4	$	109.4	$	447.4	$	321.8

Revenue is shown based on the geographic location of our company-owned and franchisees’ restaurants. All assets are located in the United States.

During the thirty-nine weeks ended September 29, 2024 and September 24, 2023, no individual franchisee accounted for more than 10% of the Company’s revenue.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our results of operations, financial condition, and liquidity and capital resources should be read in conjunction with our financial statements and related notes for the thirteen and thirty-nine weeks ended September 29, 2024 and September 24, 2023, as applicable. Certain statements made or incorporated by reference in this report and our other filings with the Securities and Exchange Commission, in our press releases, and in statements made by or with the approval of authorized personnel constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act, and are subject to the safe harbor created thereby. Forward-looking statements reflect intent, belief, current expectations, estimates or projections about, among other things, our industry, management’s beliefs, and future events and financial trends affecting us. Words such as “anticipates”, “expects”, “intends”, “plans”, “believes”, “seeks”, “estimates”, “may”, “will”, and variations of these words or similar expressions are intended to identify forward-looking statements. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. Although we believe the expectations reflected in any forward-looking statements are reasonable, such statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Therefore, our actual results could differ materially and adversely from those expressed in any forward-looking statements as a result of various factors. These differences can arise as a result of the risks described in the section entitled “Item 1A. Risk Factors” in our Annual Report on Form 10-K filed on March 12, 2024 and elsewhere in this report, as well as other factors that may affect our business, results of operations, or financial condition. Forward-looking statements in this report speak only as of the date hereof, and forward-looking statements in documents incorporated by reference speak only as of the date of those documents. Unless otherwise required by law, we undertake no obligation to publicly update or revise these forward-looking statements, whether as a result of new information, future events or otherwise. In light of these risks and uncertainties, we cannot assure you that the forward-looking statements contained in this report will, in fact, transpire.

Executive Overview

Business overview

FAT Brands Inc. is a leading multi-brand restaurant franchising company that develops, markets, and acquires primarily quick-service, fast casual, casual dining and polished casual restaurant concepts around the world. As of September 29, 2024, the Company owned 18 restaurant brands: Round Table Pizza, Fatburger, Marble Slab Creamery, Johnny Rockets, Fazoli's, Twin Peaks, Smokey Bones, Great American Cookies, Hot Dog on a Stick, Buffalo’s Cafe & Express, Hurricane Grill & Wings, Pretzelmaker, Elevation Burger, Native Grill & Wings, Yalla Mediterranean and Ponderosa and Bonanza Steakhouses. As of September 29, 2024, the Company had approximately 2,300 locations open or under construction, of which approximately 92% were franchised.

Under our franchised business model, we generate revenue by charging franchisees an initial franchise fee as well as ongoing royalties. This asset light franchisor model provides the opportunity for strong profit margins and an attractive free cash flow profile while minimizing restaurant operating company risk, such as long-term real estate commitments or capital investments. Our scalable management platform enables us to add new stores and restaurant concepts to our portfolio with minimal incremental corporate overhead cost, while taking advantage of significant corporate overhead synergies. The acquisition of additional brands and restaurant concepts as well as expansion of our existing brands are key elements of our growth strategy.

Our revenues are derived primarily from two sales channels, franchised restaurants and company owned restaurants, which we operate as one segment. The primary sources of revenues are the sale of food and beverages at our company restaurants and the collection of royalties, franchise fees and advertising revenue from sales of food and beverages at our franchised restaurants.

Results of Operations

We operate on a 52-week or 53-week fiscal year ending on the last Sunday of the calendar year. In a 52-week fiscal year, each quarter contains 13 weeks of operations. In a 53-week fiscal year, each of the first, second and third quarters includes 13 weeks of operations and the fourth quarter includes 14 weeks of operations, which may cause our revenue, expenses and other results of operations to be higher due to an additional week of operations. The 2024 fiscal year is a 52-week year. The 2023 fiscal year was a 53-week year.

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Results of Operations of FAT Brands Inc.

The following table summarizes key components of our condensed consolidated results of operations for the thirteen and thirty-nine weeks ended September 29, 2024 and September 24, 2023.

(dollars in thousands)


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	September 29, 2024		September 24, 2023		September 29, 2024		September 24, 2023
Statements of Operations Data:

Revenue
Royalties	$	22,353	$	23,930	$	67,618	$	69,166
Restaurant sales	99,238		62,578		312,587		187,957
Advertising fees	9,708		9,960		29,569		28,979
Factory revenues	9,490		9,323		28,599		28,174
Franchise fees	2,576		2,477		5,170		4,042
Other revenue	—		1,098		3,829		3,503
Total revenue	143,365		109,366		447,372		321,821

Costs and expenses
General and administrative expense	34,481		24,458		94,044		62,820
Cost of restaurant and factory revenues	96,792		59,168		295,955		177,757
Depreciation and amortization	10,736		7,040		31,176		21,217
Refranchising loss	157		408		1,840		746

Advertising fees	10,032		11,671		37,275		33,808
Total costs and expenses	152,198		102,745		460,290		296,348

(Loss) income from operations	(8,833)		6,621		(12,918)		25,473

Total other expense, net	(35,779)		(32,587)		(103,944)		(86,774)

Loss before income tax provision (benefit)	(44,612)		(25,966)		(116,862)		(61,301)

Income tax provision (benefit)	143		(1,310)		5,568		2,572

Net loss	$	(44,755)	$	(24,656)	$	(122,430)	$	(63,873)

For the Thirty-Nine Weeks Ended September 29, 2024 and September 24, 2023:

Revenue - Revenue consists of royalties, franchise fees, advertising fees, restaurant sales, factory revenue and other revenue. Total revenue increased $125.6 million, or 39.0%, in the first three quarters of 2024 to $447.4 million compared to $321.8 million in the same period of 2023 primarily driven by the acquisition of Smokey Bones in September 2023 and revenues from new restaurant openings.

Costs and expenses – Costs and expenses consist of general and administrative expense, cost of restaurant and factory revenues, depreciation and amortization, refranchising net loss and advertising fees. Costs and expenses increased $163.9 million, or 55.3%, in the first three quarters of 2024 to $460.3 million compared to the same period in the prior year, primarily due to the acquisition of Smokey Bones in September 2023 and increased activity from Company-owned restaurants and the Company's factory.

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General and administrative expense increased $31.2 million, or 49.7%, in the first three quarters of 2024 to $94.0 million compared to $62.8 million in the same period in the prior year, primarily due to the acquisition of Smokey Bones in September 2023 and the recognition of $13.7 million in Employee Retention Credits during the first three quarters of fiscal year 2023, partially offset by the recognition of $3.4 million in Employee Retention Credits during the first three quarters of fiscal year 2024.

Cost of restaurant and factory revenues was related to the operations of the company-owned restaurant locations and dough factory and increased $118.2 million, or 66.5%, in the first three quarters of fiscal year 2024, primarily due to the acquisition of Smokey Bones in September 2023 and higher company-owned restaurant and factory sales.

Depreciation and amortization increased $10.0 million, or 46.9% in the first three quarters of 2024 compared to the same period in the prior year, primarily due to the acquisition of Smokey Bones in September 2023 and depreciation of new property and equipment at company-owned restaurant locations.

Refranchising net loss in the first three quarters of 2024 of $1.8 million was comprised of $0.8 million in restaurant operating costs, net of food sales, and $1.0 million in net loss related to the sale or closure of refranchised restaurants. Refranchising net loss in the first three quarters of 2023 of $0.7 million was comprised of $0.8 million in restaurant operating costs, net of food sales, partially offset by $0.1 million in net gains related to the sale or closure of refranchised restaurants.

Advertising expenses increased $3.5 million in the first three quarters of 2024 compared to the prior year period. These expenses vary in relation to advertising revenues.

Total other expense, net, for the first three quarters of 2024 and 2023 was $103.9 million and $86.8 million, respectively, which is inclusive of interest expense of $103.6 million and $84.2 million, respectively. This increase is primarily due to new debt offerings which occurred in the first three quarters of fiscal year 2023. Total other expense, net, for the first three quarters of 2024 also consisted of a $0.4 million net gain on the extinguishment of debt. Total other expense, net, for the first three quarters of 2023 also consisted of a $2.7 million net loss on the extinguishment of debt.

Income tax provision – The effective rate was (4.8)% and (4.2)% for the first three quarters of fiscal year 2024 and fiscal year 2023, respectively. The difference in effective rate was primarily due to increases in the valuation allowance, nondeductible expenses and the impact of state income taxes.

For the Thirteen Weeks Ended September 29, 2024 and September 24, 2023:

Revenue - Revenue consists of royalties, franchise fees, advertising fees, restaurant sales, factory revenue and other revenue. Total revenue increased $34.0 million, or 31.1%, in the third quarter of 2024 to $143.4 million compared to $109.4 million in the same period of 2023, driven by the acquisition of Smokey Bones in September 2023 and revenues from new restaurant openings.

Costs and expenses – Costs and expenses consist of general and administrative expense, cost of restaurant and factory revenues, depreciation and amortization, refranchising net loss and advertising fees. Costs and expenses increased $49.5 million, or 48.1%, in the third quarter of 2024 to $152.2 million compared to the same period in the prior year, primarily due to the acquisition of Smokey Bones in September 2023 and increased activity from Company-owned restaurants and the Company's factory.

General and administrative expense increased $10.0 million, or 41.0%, in the third quarter of 2024 to $34.5 million compared to $24.5 million in the same period in the prior year, primarily due to the acquisition of Smokey Bones in September 2023 and increased professional fees related to pending litigation.

Cost of restaurant and factory revenues was related to the operations of the company-owned restaurant locations and dough factory and increased $37.6 million, or 63.6%, in the third quarter of 2024, primarily due to the acquisition of Smokey Bones in September 2023 and higher company-owned restaurant sales.

Depreciation and amortization increased $3.7 million, or 52.5% in the third quarter of 2024 compared to the same period in the prior year, primarily due to the acquisition of Smokey Bones in September 2023 and depreciation of new property and equipment at company-owned restaurant locations.

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Refranchising net loss in the third quarter of 2024 of $0.2 million was comprised of restaurant operating costs, net of food sales. Refranchising net loss in the third quarter of 2023 of $0.4 million was comprised of restaurant operating costs, net of food sales.

Advertising expenses decreased $1.6 million in the third quarter of 2024 compared to the prior year period. These expenses vary in relation to advertising revenues.

Total other expense, net, for the third quarter of 2024 and 2023 was $35.8 million and $32.6 million, respectively, which is inclusive of interest expense of $35.5 million and $29.7 million, respectively. This increase is primarily due to new debt issuances. Total other expense, net, for the third quarter of 2023 also consisted of a $2.7 million net loss on the extinguishment of debt.

Income tax provision – The effective rate was (0.3)% and 5.0% for the third quarter of 2024 and 2023, respectively. The difference in effective rate was primarily due to increases in the valuation allowance, nondeductible expenses and the impact of state income taxes.

Liquidity and Capital Resources

Liquidity is a measurement of our ability to meet potential cash requirements, including ongoing commitments to repay borrowings, fund business operations, acquisitions and expansion of franchised restaurant locations and for other general business purposes. Our primary sources of funds for liquidity during the thirty-nine weeks ended September 29, 2024 consisted of cash on hand at the beginning of the period and net proceeds of $69.9 million from the sale of secured debt as discussed in Note 9 of the accompanying condensed consolidated financial statements.

We are involved in a world-wide expansion of franchise locations, which will require significant liquidity, primarily from our franchisees. If real estate locations of sufficient quality cannot be located and either leased or purchased, the timing of restaurant openings may be delayed. Additionally, if we or our franchisees cannot obtain capital sufficient to fund this expansion, the extent or timing of restaurant openings may be reduced or delayed.

We also may acquire additional restaurant concepts. These acquisitions typically require capital investments in excess of our normal cash on hand. We would expect that future acquisitions will necessitate financing with additional debt or equity transactions. If we are unable to obtain acceptable financing, our ability to acquire additional restaurant concepts likely would be negatively impacted.

We have liabilities of $91.8 million relating to put options exercised by others on our Series B Cumulative Preferred Stock. The Company has contractual options pursuant to the put/call agreements to extend this repayment via incremental interest payments and there are capital market options that the Company may consider. We believe that we have sufficient liquidity to meet our liquidity needs and capital resource requirements for at least the next twelve months primarily through currently available cash and cash equivalents, cash flows from operations and access to the capital markets.

Table of Contents

Comparison of Cash Flows

Our cash and restricted cash balance was $66.7 million as of September 29, 2024, compared to $91.9 million as of December 31, 2023.

The following table summarizes key components of our condensed consolidated cash flows for the 39 weeks ended September 29, 2024 and September 24, 2023:

For the Thirty-Nine Weeks Ended

(in millions)


	September 29, 2024		September 24, 2023
Net cash used in operating activities	$	(45.8)	$	(23.0)
Net cash used in investing activities	(26.0)		(14.3)
Net cash provided by financing activities	46.6		107.4
Net cash flows	$	(25.2)	$	70.1

Operating Activities

Net cash used in operating activities increased $22.8 million in the thirty-nine weeks ended September 29, 2024 compared to 2023, primarily due to higher debt service costs associated with our securitizations and by changes in working capital.

Investing Activities

Net cash used in investing activities was $26.0 million in the thirty-nine weeks ended September 29, 2024, compared to net cash used in investing activities of $14.3 million in the comparable period of 2023, primarily driven by increases in purchases of property and equipment in connection with company-owned restaurants.

Financing Activities

Net cash provided by financing activities was $46.6 million in the thirty-nine weeks ended September 29, 2024 and primarily comprised of proceeds from borrowings, partially offset by repayments of borrowings and dividends paid on our Class A and Class B Common Stock and our Series B Cumulative Preferred Stock.

Dividends

On January 9, 2024, the Board of Directors declared a cash dividend of $0.14 per share of Class A common stock and Class B common stock, payable on March 1, 2024 to stockholders of record as of February 15, 2024, for a total of $2.4 million. On April 17, 2024, the Board of Directors declared a cash dividend of $0.14 per share of Class A and Class B Common Stock, payable on May 31, 2024 to stockholders of record as of May 15, 2024, for a total of $2.4 million. On July 9, 2024, the Board of Directors declared a cash dividend of $0.14 per share of Class A and Class B Common Stock, payable on August 30, 2024 to stockholders of record as of August 15, 2024, for a total of $2.4 million. On October 29, 2024, the Board of Directors declared a cash dividend of $0.14 per share of Class A and Class B Common Stock, payable on November 29, 2024 to stockholders of record as of November 15, 2024.

The declaration and payment of future dividends, as well as the amount thereof, are subject to the discretion of our Board of Directors. The amount and size of any future dividends will depend upon our future results of operations, financial condition, capital levels, cash requirements, and other factors. There can be no assurance that we will declare and pay dividends in future periods.

Capital Expenditures

As of September 29, 2024, we do not have any material commitments for capital expenditures.

Table of Contents

Critical Accounting Policies and Estimates

Our condensed consolidated financial statements and accompanying notes are prepared in accordance with GAAP. Preparing condensed consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. These estimates and assumptions are affected by the application of our accounting policies. Our significant accounting policies are described in our Annual Report on Form 10-K for the year ended December 31, 2023 filed on March 12, 2024. Critical accounting estimates are those that require application of management’s most difficult, subjective or complex judgments, often as a result of matters that are inherently uncertain and may change in subsequent periods. While we apply our judgment based on assumptions believed to be reasonable under the circumstances, actual results could vary from these assumptions. It is possible that materially different amounts would be reported using different assumptions. Our critical accounting estimates are identified and described in our annual consolidated financial statements and the related notes included in our Annual Report on Form 10-K for our fiscal year ended December 31, 2023 filed on March 12, 2024.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not Required.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our principal executive officers and principal financial officer, we carried out an evaluation of the effectiveness of our Disclosure Controls and Procedures (as defined in the Securities and Exchange Act of 1934 Rules 13a-15(e) and 15d-15(e)) as of the end of the period covered by this report. Based on that evaluation, our principal executive officers and principal financial officer have concluded that our Disclosure Controls and Procedures were effective.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting in connection with an evaluation that occurred during the thirteen weeks ended September 29, 2024 that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.

Inherent Limitations Over Internal Controls

We do not expect that our Disclosure Controls and Procedures will prevent all error and all fraud. A control procedure, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control procedures are met. Because of the inherent limitations in all control procedures, no evaluation of controls can provide absolute assurance that all control issues and instances of frauds, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.

PART II — OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

For a description of our material pending legal proceedings, please see Note 14, Commitments and Contingencies, to the condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q, which Note is incorporated by reference in this Item 1.

Table of Contents

ITEM 1A. RISK FACTORS

You should carefully consider the factors discussed below and in Part I, Item 1A. “Risk Factors” and elsewhere in our Annual Report on Form 10-K filed on March 12, 2024, which could materially affect our business, financial condition, cash flows or future results. The risks described below and in our Annual Report are not the only risks facing our company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition or future results.

We face risks related to pending government charges and are a party to stockholder litigation, which could cause us to incur additional expenses and could materially adversely affect our business, financial condition, and reputation.

On May 10, 2024, the U.S. Department of Justice indicted the Company on two violations of Section 402 of the Sarbanes-Oxley Act for directly and indirectly extending and/or arranging for the extension of credit in 2019 and 2020 to our former Chief Executive Officer, Andrew Wiederhorn, in the aggregate amount of $2.65 million. In addition, the SEC filed a complaint against us alleging that for periods covering 2017 through 2020, we failed to disclose certain related party transactions, failed to maintain proper books and records and internal accounting controls, made false or misleading statements regarding our liquidity and use of proceeds from certain transactions, and directly or indirectly extended credit to Mr. Wiederhorn in the form of a personal loan. A putative civil securities class action lawsuit was subsequently filed in June 2024 by an investor against our Company, Mr. Wiederhorn and our co-Chief Executive Officers, alleging that the defendants made false and misleading statements and omitted material facts in our reports filed with the SEC related to the subject matter of the government investigations and litigation, our handling of these matters, and our cooperation with the government. Such governmental charges and stockholder action present certain risks, and at this stage, we are not able to reasonably estimate the outcome or duration of these actions, nor can we predict what consequences any such action may have on our Company. Moreover, there could be developments of which we are not aware, and which could result in further proceedings against Mr. Wiederhorn, our Company, and our other directors, officers and employees. We may incur additional costs in connection with the defense or settlement of existing and any future government charges and stockholder actions.

These pending government charges and stockholder litigation, the results thereof, including any fines, penalties or settlements payable by us, and any actions that we have taken or may take as a result thereof may materially adversely affect our business, financial condition, and reputation. If we are ultimately subject to adverse findings resulting from such pending government charges and stockholder litigation, we could be required to pay damages and/or penalties or have other remedies imposed on us, and we and/or our directors, officers or employees may be subject to additional civil litigation against our Company and/or our directors and officers regarding such matters.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

During the fiscal quarter ended September 29, 2024, no director or officer of the Company adopted or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement," as each term is defined in Item 408(a) of Regulation S-K.

Table of Contents

ITEM 6. EXHIBITS

Incorporated By Reference to

Filed

Herewith

Description

Form

Exhibit

Filing Date

31.1

C o-C hief Executive Officer and Chief Financial Officer Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2

C o-C hief Executive Officer Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1

Certifications of the Co-Chief Executive Officer s and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS

Inline XBRL Instance Document

X (Furnished)

101.SCH

Inline XBRL Taxonomy Extension Schema Document

X (Furnished)

101.CAL

Inline XBRL Taxonomy Extension Calculation Linkbase Document

X (Furnished)

101.DEF

Inline XBRL Taxonomy Extension Definition Linkbase Document

X (Furnished)

101.LAB

Inline XBRL Taxonomy Extension Label Linkbase Document

X (Furnished)

101.PRE

Inline XBRL Taxonomy Extension Presentation Linkbase Document

X (Furnished)

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	FAT BRANDS INC.

October 31, 2024	By	/s/ Kenneth J. Kuick
		Kenneth J. Kuick
		Co-Chief Executive Officer and Chief Financial Officer
		(Principal Financial Officer and duly authorized signatory for the registrant)

Exhibit 31.1

CERTIFICATION PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

(18 U.S.C. SECTION 1350)

I, Kenneth J. Kuick, certify that:

1.I have reviewed this quarterly report on Form 10-Q of FAT Brands Inc.:

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: October 31, 2024			/s/ Kenneth J. Kuick
			Kenneth J. Kuick
			Co-Chief Executive Officer and Chief Financial Officer
			(Principal Executive and Financial Officer)

Exhibit 31.2

CERTIFICATION PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

(18 U.S.C. SECTION 1350)

I, Robert G. Rosen, certify that:

1.I have reviewed this quarterly report on Form 10-Q of FAT Brands Inc.:

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: October 31, 2024			/s/ Robert G. Rosen
			Robert G. Rosen
			Co-Chief Executive Officer
			(Principal Executive Officer)

Exhibit 32.1

CERTIFICATIONS OF THE CO-CHIEF EXECUTIVE OFFICERS AND CHIEF FINANCIAL OFFICER

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

Each of the undersigned hereby certifies, in accordance with 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, in his capacity as an officer of FAT Brands Inc., that, to his or her knowledge, the Quarterly Report of FAT Brands Inc. on Form 10-Q for the period ended September 29, 2024 fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 and that the information contained in such report fairly presents, in all material respects, the financial condition and results of operation of the company.


Date: October 31, 2024	By	/s/ Kenneth J. Kuick
		Kenneth J. Kuick
		Co-Chief Executive Officer and Chief Financial Officer
		(Principal Executive, Financial and Accounting Officer)

Date: October 31, 2024	By	/s/ Robert G. Rosen
		Robert G. Rosen
		Co-Chief Executive Officer
		(Principal Executive Officer)

A signed original of this written statement required by Section 906 has been provided to FAT Brands Inc. and will be retained by FAT Brands Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

Cover - shares	9 Months Ended
Cover - shares	Sep. 29, 2024	Oct. 28, 2024
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 29, 2024
Document Transition Report	false
Entity File Number	001-38250
Entity Registrant Name	FAT Brands Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	82-1302696
Entity Address, Address Line One	9720 Wilshire Blvd.
Entity Address, Address Line Two	Suite 500
Entity Address, City or Town	Beverly Hills
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	90212
City Area Code	(310)
Local Phone Number	319-1850
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Amendment Flag	false
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2024
Current Fiscal Year End Date	--12-29
Entity Central Index Key	0001705012
Class A Common Stock
Document Information [Line Items]
Title of 12(b) Security	Class A Common Stock, par value $0.0001 per share
Trading Symbol	FAT
Security Exchange Name	NASDAQ
Entity Common Stock, Shares Outstanding		15,835,800
Class B Common Stock
Document Information [Line Items]
Title of 12(b) Security	Class B Common Stock, par value $0.0001 per share
Trading Symbol	FATBB
Security Exchange Name	NASDAQ
Entity Common Stock, Shares Outstanding		1,270,805
Series B Cumulative Preferred Stock
Document Information [Line Items]
Title of 12(b) Security	Series B Cumulative Preferred Stock, par value $0.0001 per share
Trading Symbol	FATBP
Security Exchange Name	NASDAQ
Warrants to Purchase Common Stock
Document Information [Line Items]
Title of 12(b) Security	Warrants to purchase Class A Common Stock
Trading Symbol	FATBW
Security Exchange Name	NASDAQ

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 29, 2024	Dec. 31, 2023
Current assets
Cash	$ 16,837	$ 37,044
Restricted cash	33,439	39,271
Accounts receivable, net	18,256	21,146
Inventory	8,468	9,306
Assets classified as held-for-sale	370	3,756
Other current assets	14,048	10,486
Total current assets	91,418	121,009
Non-current restricted cash	16,468	15,588
Operating lease right-of-use assets	207,520	220,035
Goodwill	305,054	305,089
Other intangible assets, net	608,458	620,622
Property and equipment, net	104,938	100,524
Other assets	5,779	5,371
Total assets	1,339,635	1,388,238
Current liabilities
Accounts payable	30,054	21,809
Accrued expenses and other liabilities	66,708	58,903
Deferred income, current portion	2,300	2,490
Accrued advertising	7,203	7,992
Accrued interest payable	31,723	24,961
Dividend payable on preferred shares	1,358	1,325
Liabilities related to assets classified as held-for-sale	393	3,421
Operating lease liability, current portion	21,499	17,254
Redeemable preferred stock	91,836	91,836
Long-term debt, current portion	49,141	42,611
Acquisition purchase price payable	0	4,000
Total current liabilities	302,215	276,602
Deferred income, net of current portion	20,691	21,958
Deferred income tax liabilities, net	22,556	18,805
Operating lease liability, net of current portion	198,963	211,744
Long-term debt, net of current portion	1,177,921	1,110,308
Other liabilities	3,439	4,684
Total liabilities	1,725,785	1,644,101
Commitments and contingencies (Note 14)
Stockholders’ deficit
Preferred stock and additional paid-in-capital, $0.0001 par value; 15,000,000 shares authorized; 3,782,459 shares issued and outstanding at September 29, 2024 and 3,591,804 shares issued and outstanding at December 31, 2023; liquidation preference $25 per share	41,106	44,103
Class A common stock and Class B common stock and additional paid-in capital as of September 29, 2024: $0.0001 par value per share; 51,600,000 shares authorized (Class A 50,000,000, Class B 1,600,000); 17,106,468 shares issued and outstanding (Class A 15,835,663, Class B 1,270,805). Common stock and additional paid-in capital as of December 31, 2023: $0.0001 par value; 51,600,000 shares authorized; 16,900,099 shares issued and outstanding (Class A 15,629,294, Class B 1,270,805)	(36,049)	(31,189)
Accumulated deficit	(391,207)	(268,777)
Total stockholders’ deficit	(386,150)	(255,863)
Total liabilities and stockholders’ deficit	$ 1,339,635	$ 1,388,238

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Sep. 29, 2024	Dec. 31, 2023
Preferred stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, authorized (in shares)	15,000,000	15,000,000
Preferred stock, issued (in shares)	3,782,459	3,591,804
Preferred stock, outstanding (in shares)	3,782,459	3,591,804
Preferred stock, liquidation preference (in dollars per share)	$ 25	$ 25
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, authorized (in shares)	51,600,000	51,600,000
Common stock, issued (in shares)	17,106,468	16,900,099
Common stock, outstanding (in shares)	17,106,468	16,900,099
Class A Common Stock
Common stock, authorized (in shares)	50,000,000
Common stock, issued (in shares)	15,835,663	15,629,294
Common stock, outstanding (in shares)	15,835,663	15,629,294
Class B Common Stock
Common stock, authorized (in shares)	1,600,000
Common stock, issued (in shares)	1,270,805	1,270,805
Common stock, outstanding (in shares)	1,270,805	1,270,805

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 29, 2024	Sep. 24, 2023	Sep. 29, 2024	Sep. 24, 2023
Revenue
Total revenue	$ 143,365	$ 109,366	$ 447,372	$ 321,821
Costs and expenses
General and administrative expense	34,481	24,458	94,044	62,820
Cost of restaurant and factory revenues	96,792	59,168	295,955	177,757
Depreciation and amortization	10,736	7,040	31,176	21,217
Refranchising loss	157	408	1,840	746
Advertising fees	10,032	11,671	37,275	33,808
Total costs and expenses	152,198	102,745	460,290	296,348
(Loss) income from operations	(8,833)	6,621	(12,918)	25,473
Other (expense) income, net
Interest expense	(31,109)	(25,319)	(90,318)	(70,417)
Interest expense related to preferred shares	(4,418)	(4,417)	(13,253)	(13,771)
Net gain (loss) on extinguishment of debt	0	(2,723)	427	(2,723)
Other (expense) income, net	(252)	(128)	(800)	137
Total other expense, net	(35,779)	(32,587)	(103,944)	(86,774)
Loss before income tax provision (benefit)	(44,612)	(25,966)	(116,862)	(61,301)
Income tax provision (benefit)	143	(1,310)	5,568	2,572
Net loss	(44,755)	(24,656)	(122,430)	(63,873)
Dividends on preferred shares	(1,935)	(1,794)	(5,736)	(5,175)
Net loss available to common stockholders, basic	(46,690)	(26,450)	(128,166)	(69,048)
Net loss available to common stockholders, diluted	$ (46,690)	$ (26,450)	$ (128,166)	$ (69,048)
Basic loss per common share (in dollars per share)	$ (2.74)	$ (1.59)	$ (7.54)	$ (4.17)
Diluted loss per common share (in dollars per share)	$ (2.74)	$ (1.59)	$ (7.54)	$ (4.17)
Basic weighted average shares outstanding (in shares)	17,052,007	16,613,840	16,999,889	16,553,528
Diluted weighted average shares outstanding (in shares)	17,052,007	16,613,840	16,999,889	16,553,528
Cash dividends declared per common share (in dollars per share)	$ 0.14	$ 0.14	$ 0.42	$ 0.42
Royalties
Revenue
Total revenue	$ 22,353	$ 23,930	$ 67,618	$ 69,166
Restaurant sales
Revenue
Total revenue	99,238	62,578	312,587	187,957
Advertising fees
Revenue
Total revenue	9,708	9,960	29,569	28,979
Factory revenues
Revenue
Total revenue	9,490	9,323	28,599	28,174
Franchise fees
Revenue
Total revenue	2,576	2,477	5,170	4,042
Other revenue
Revenue
Total revenue	$ 0	$ 1,098	$ 3,829	$ 3,503

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT - USD ($) $ in Thousands	Total	Class A Common Stock	Class B Common Stock	Common Stock	Preferred Stock	Total Common Stock	Total Common Stock Common Stock	Common Stock Class A Common Stock	Common Stock Class B Common Stock	Additional Paid-In Capital	Additional Paid-In Capital Common Stock	Total Preferred Stock	Total Preferred Stock Preferred Stock	Preferred Stock	Additional Paid-In Capital	Additional Paid-In Capital Preferred Stock	Accumulated Deficit
Beginning balance (in shares) at Dec. 25, 2022								15,300,870	1,270,805
Beginning balance (in shares) at Dec. 25, 2022														3,252,154
Beginning balance, value at Dec. 25, 2022	$ (159,178)					$ (26,015)		$ 2	$ 0	$ (26,017)		$ 45,504		$ 0	$ 45,504		$ (178,667)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(63,873)																(63,873)
Issuance of common and preferred stock (in shares)								194,839						208,098
Issuance of common and preferred stock	3,817					348				348		3,469			3,469
Share-based compensation	2,668					2,668				2,668
Dividends paid				$ (6,980)	$ (5,175)		$ (6,980)				$ (6,980)		$ (5,175)			$ (5,175)
Ending balance (in shares) at Sep. 24, 2023								15,495,709	1,270,805
Ending balance (in shares) at Sep. 24, 2023														3,460,252
Ending balance, value at Sep. 24, 2023	(228,721)					(29,979)		$ 2	$ 0	(29,981)		43,798		$ 0	43,798		(242,540)
Beginning balance (in shares) at Jun. 25, 2023								15,340,370	1,270,805
Beginning balance (in shares) at Jun. 25, 2023														3,338,573
Beginning balance, value at Jun. 25, 2023	(203,195)					(28,877)		$ 2	$ 0	(28,879)		43,566		$ 0	43,566		(217,884)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(24,656)																(24,656)
Issuance of common and preferred stock (in shares)								155,339						121,679
Issuance of common and preferred stock	2,165					139				139		2,026			2,026
Share-based compensation	1,096					1,096				1,096
Dividends paid				(2,337)	(1,794)		(2,337)				(2,337)		(1,794)			(1,794)
Ending balance (in shares) at Sep. 24, 2023								15,495,709	1,270,805
Ending balance (in shares) at Sep. 24, 2023														3,460,252
Ending balance, value at Sep. 24, 2023	$ (228,721)					(29,979)		$ 2	$ 0	(29,981)		43,798		$ 0	43,798		(242,540)
Beginning balance (in shares) at Dec. 31, 2023	16,900,099	15,629,294	1,270,805					15,629,294	1,270,805
Beginning balance (in shares) at Dec. 31, 2023	3,591,804													3,591,804
Beginning balance, value at Dec. 31, 2023	$ (255,863)					(31,189)		$ 2	$ 0	(31,191)		44,103		$ 0	44,103		(268,777)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(122,430)																(122,430)
Issuance of common and preferred stock (in shares)								206,369						190,655
Issuance of common and preferred stock	3,061					322				322		2,739			2,739
Share-based compensation	$ 1,961					1,961				1,961
Dividends paid				(7,143)	(5,736)		(7,143)				(7,143)		(5,736)			(5,736)
Ending balance (in shares) at Sep. 29, 2024	17,106,468	15,835,663	1,270,805					15,835,663	1,270,805
Ending balance (in shares) at Sep. 29, 2024	3,782,459													3,782,459
Ending balance, value at Sep. 29, 2024	$ (386,150)					(36,049)		$ 2	$ 0	(36,051)		41,106		$ 0	41,106		(391,207)
Beginning balance (in shares) at Jun. 30, 2024								15,742,515	1,270,805
Beginning balance (in shares) at Jun. 30, 2024														3,712,883
Beginning balance, value at Jun. 30, 2024	(338,640)					(34,420)		$ 2	$ 0	(34,422)		42,232		$ 0	42,232		(346,452)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(44,755)																(44,755)
Issuance of common and preferred stock (in shares)								93,148						69,576
Issuance of common and preferred stock	1,027					218				218		809			809
Share-based compensation	$ 539					539				539
Dividends paid				$ (2,386)	$ (1,935)		$ (2,386)				$ (2,386)		$ (1,935)			$ (1,935)
Ending balance (in shares) at Sep. 29, 2024	17,106,468	15,835,663	1,270,805					15,835,663	1,270,805
Ending balance (in shares) at Sep. 29, 2024	3,782,459													3,782,459
Ending balance, value at Sep. 29, 2024	$ (386,150)					$ (36,049)		$ 2	$ 0	$ (36,051)		$ 41,106		$ 0	$ 41,106		$ (391,207)

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 29, 2024	Sep. 24, 2023
Cash flows from operating activities:
Net loss	$ (122,430)	$ (63,873)
Adjustments to reconcile net loss to net cash used in operating activities:
Deferred income taxes	3,751	(184)
Depreciation and amortization	31,176	21,217
Share-based compensation	1,961	2,668
Accretion of loan fees and interest	17,036	12,256
Loss on disposal of fixed assets	258	0
Net (gain) loss on extinguishment of debt	(427)	2,723
Provision for bad debts	787	(1,437)
Change in:
Accounts receivable	2,104	13,491
Inventory	838	90
Other current and noncurrent assets	(4,217)	(858)
Operating lease assets and liabilities	3,581	287
Deferred income	(1,457)	(681)
Accounts payable	8,246	89
Accrued expenses and other liabilities	7,793	369
Accrued advertising	(789)	(2,799)
Accrued interest payable	6,763	5,944
Other current and noncurrent liabilities	(810)	(12,338)
Total adjustments	76,594	40,837
Net cash used in operating activities	(45,836)	(23,036)
Cash flows from investing activities:
Acquisitions, net of cash acquired		(1,140)
Purchases of property and equipment	(22,210)	(13,427)
Payments received on notes receivable	247	218
Payment of acquisition purchase price payable	(4,000)
Net cash used in investing activities	(25,963)	(14,349)
Cash flows from financing activities:
Proceeds from borrowings, net of issuance costs	110,879	194,163
Repayments of borrowings	(54,421)	(78,366)
Proceeds from issuance of common and preferred shares	3,061	3,817
Dividends paid on common shares	(7,143)	(6,980)
Dividends paid on preferred shares	(5,736)	(5,175)
Net cash provided by financing activities	46,640	107,459
Net (decrease) increase in cash and restricted cash	(25,159)	70,074
Cash and restricted cash at beginning of the period	91,903	68,763
Cash and restricted cash at end of the period	66,744	138,837
Supplemental disclosures of cash flow information:
Cash paid for interest	88,047	80,616
Cash paid for income taxes	$ 1,944	$ 802

ORGANIZATION AND RELATIONSHIPS	9 Months Ended
ORGANIZATION AND RELATIONSHIPS	Sep. 29, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
ORGANIZATION AND RELATIONSHIPS	ORGANIZATION AND RELATIONSHIPS Organization and Nature of Business FAT Brands Inc. (the "Company" or "FAT") is a leading multi-brand restaurant company that develops, markets, acquires and manages quick-service, fast casual, casual dining and polished casual dining restaurant concepts around the world. As of September 29, 2024, the Company owned eighteen restaurant brands: Round Table Pizza, Fatburger, Marble Slab Creamery, Johnny Rockets, Fazoli's, Twin Peaks, Smokey Bones, Great American Cookies, Hot Dog on a Stick, Buffalo’s Cafe & Express, Hurricane Grill & Wings, Pretzelmaker, Elevation Burger, Native Grill & Wings, Yalla Mediterranean and Ponderosa and Bonanza Steakhouses. As of September 29, 2024, the Company had approximately 2,300 locations open and under construction, of which approximately 92% were franchised. Each franchising subsidiary licenses the right to use its brand name and provides franchisees with operating procedures and methods of merchandising. Upon signing a franchise agreement, the franchisor is committed to provide training, some supervision and assistance and access to operations manuals. As needed, the franchisor will also provide advice and written materials concerning techniques of managing and operating the restaurants. The Company's operations have historically been comprised primarily of franchising a growing portfolio of restaurant brands. This growth strategy is centered on expanding the footprint of existing brands and acquiring new brands through a centralized management organization which provides substantially all executive leadership, marketing, training and accounting services. As part of these ongoing franchising efforts, the Company will, from time to time, make opportunistic acquisitions of operating restaurants and may convert them to franchise locations. During the refranchising period the Company may operate the restaurants and classifies the operational activities as refranchising gains or losses and the assets and associated liabilities as held-for sale. Through recent acquisitions, the Company also operates "company-owned" restaurant locations of certain brands. Liquidity The Company recognized loss from operations of $12.9 million during the thirty-nine weeks ended September 29, 2024 and income from operations of $25.5 million during the thirty-nine weeks ended September 24, 2023. The Company has a history of net losses and an accumulated deficit of $391.2 million as of September 29, 2024. Additionally, the Company had negative working capital of $210.8 million. Of this amount, $91.8 million represents redeemable preferred stock as discussed in Note 10. Since the Company did not deliver the applicable cash proceeds at the related due dates, the amount accrues interest until the payments are completed. The Company had $16.8 million of unrestricted cash at September 29, 2024 and plans on the combination of cash flows from operations, cash on hand, $71.5 million of issued but not sold aggregate principal amount of fixed rate secured notes and $95.0 million aggregate principal amount of repurchased but not re-sold fixed rate secured notes (see Note 9) to be sufficient to cover any working capital requirements for the next twelve months from the date of this report. If the Company does not achieve its operating plan, additional forms of financing may be required through the issuance of debt or equity. Although management believes it will have access to financing, no assurances can be given that such financing will be available on acceptable terms, in a timely manner or at all.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	9 Months Ended
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	Sep. 29, 2024
Accounting Policies [Abstract]
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of presentation – The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Our revenues are derived primarily from two sales channels, franchised restaurants and company-owned locations, which we operate as one reportable segment. The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America (“GAAP”) for complete financial statements. In the opinion of the Company, all adjustments considered necessary for the fair presentation of the Company’s results of operations, financial position and cash flows for the periods presented have been included and are of a normal, recurring nature. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company's 2023 Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the SEC on March 12, 2024. Nature of operations – The Company operates on a 52-week calendar and its fiscal year ends on the last Sunday of the calendar year. Consistent with industry practice, the Company measures its stores’ performance based upon 7-day work weeks. Using the 52-week cycle ensures consistent weekly reporting for operations and ensures that each week has the same days since certain days are more profitable than others. The use of this fiscal year means a 53rd week is added to the fiscal year every 5 or 6 years. In a 52-week year, all four quarters are comprised of 13 weeks. In a 53-week year, one extra week is added to the fourth quarter. Fiscal year 2023 was a 53-week year and 2024 is a 52-week year. Employee Retention Tax Credits - On March 27, 2020, the U.S. government enacted the Coronavirus Aid Relief and Security Act (the "CARES Act") to provide certain relief as a result of the COVID-19 pandemic. The CARES Act provides tax relief, along with other stimulus measures, including a provision for an Employee Retention Credit ("ERC"). As there is no authoritative guidance under U.S. GAAP on accounting for government assistance to for-profit business entities, the Company accounts for the ERC by analogy to International Accounting Standard, Accounting for Government Grants and Disclosure of Government Assistance ("IAS 20"). During the thirteen weeks ended September 29, 2024 and September 24, 2023, the Company received and recognized $1.3 million and $1.0 million, respectively, of ERCs recorded within general and administrative expense on the consolidated statements of operations. During the thirty-nine weeks ended September 29, 2024 and September 24, 2023, the Company received and recognized $3.4 million and $13.7 million, respectively, of ERCs recorded within general and administrative expense on the consolidated statements of operations. Use of estimates in the preparation of the condensed consolidated financial statements – The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements. Significant estimates include the determination of fair values of goodwill and other intangible assets, allowances for uncollectible notes receivable and accounts receivable, and the valuation allowance related to deferred tax assets. Estimates and assumptions also affect the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Recently Issued Accounting Standards Not Yet Adopted In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The amendments improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The amendments require that a public entity disclose, on an annual and interim basis, an amount for other segment items by reportable segment and a description of its composition. The other segment items category is the difference between segment revenue less the segment expenses disclosed under the significant expense principle and each reported measure of segment profit or loss. The amendments improve financial reporting by requiring disclosure of incremental segment information on an annual and interim basis for all public entities. The amendments are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. A public entity should apply the amendments retrospectively to all prior periods presented in the financial statements. Upon transition, the segment expense categories and amounts disclosed in the prior periods should be based on the significant segment expense categories identified and disclosed in the period of adoption. The Company is currently evaluating the impact the adoption of this standard will have on its condensed consolidated financial statements. In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The amendments require that public business entities on an annual basis disclose specific categories in the rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold. The amendments also require that all entities disclose on an annual basis the income taxes paid disaggregated by jurisdiction. The amendments eliminate the requirement for all entities to disclose the nature and estimate of the range of the reasonably possible change in the unrecognized tax benefits balance in the next 12 months or make a statement that an estimate of the range cannot be made. The amendments are effective for annual periods beginning after December 15, 2024. Early adoption is permitted. The amendments should be applied on a prospective basis. Retrospective application is permitted. The Company is currently evaluating the impact the adoption of this standard will have on its condensed consolidated financial statements.

MERGERS AND ACQUISITIONS

9 Months Ended

Sep. 29, 2024

Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]

MERGERS AND ACQUISITIONS

Acquisition of Barbeque Integrated, Inc.


Cash	$	0.3
Accounts receivable, net of allowance	2.8
Inventory	2.6
Prepaids and other current assets	1.5
Other intangible assets, net	8.8
Goodwill	11.7
Operating lease right-of-use assets	108.9
Other assets	1.8
Property and equipment, net	18.1
Below market leases	0.2
Accounts payable	(3.6)
Accrued expenses and other liabilities	(9.9)

Operating lease liability, current portion	(3.9)
Operating lease liability, net of current portion	(105.6)

Other liabilities	(2.4)
Total net identifiable assets	$	31.3

Pro Forma Information


	Thirteen Weeks Ended		Thirty-Nine Weeks Ended
	September 24, 2023
Revenue	$	146.8	$	451.5
Net loss	$	(15.8)	$	(54.7)

REFRANCHISING

9 Months Ended

Sep. 29, 2024

Refranchising [Abstract]

REFRANCHISING


	September 29, 2024		December 31, 2023

Property and equipment	$	—	$	0.7
Operating lease right-of-use assets	0.4		3.1
Total	$	0.4	$	3.8

The following table highlights the operating results of the Company's refranchising program (in millions):


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	September 29, 2024		September 24, 2023		September 29, 2024		September 24, 2023
Restaurant costs and expenses, net of revenue	$	0.2	$	0.4	$	0.8	$	0.8
Loss (gain) on store sales or closures	—		—		1.0		(0.1)

Refranchising loss	$	0.2	$	0.4	$	1.8	$	0.7

PROPERTY AND EQUIPMENT, NET

9 Months Ended

Sep. 29, 2024

Property, Plant and Equipment [Abstract]

PROPERTY AND EQUIPMENT, NET

Property and equipment, net consists of the following (in millions):


	September 29, 2024		December 31, 2023
Real estate	$	93.3	$	83.5
Equipment	56.2		44.9
	149.5		128.4
Accumulated depreciation	(44.6)		(27.9)
Property and equipment, net	$	104.9	$	100.5

GOODWILL AND OTHER INTANGIBLE ASSETS, NET

9 Months Ended

Sep. 29, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND OTHER INTANGIBLE ASSETS, NET

Changes in Carrying Value of Goodwill and Other Intangible Assets (in millions)


	Amortizing Intangible Assets		Non-Amortizing Intangible Assets
			Goodwill		Trademarks
December 31, 2023	$	157.9	$	305.1	$	462.7
Amortization	(12.1)		—		—

September 29, 2024	$	145.8	$	305.1	$	462.7

Gross Carrying Value and Accumulated Amortization of Other Intangible Assets (in millions)


	September 29, 2024							December 31, 2023
		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Amortizing intangible assets
Franchise agreements		$	118.3	$	(31.0)	$	87.3	$	109.5	$	(24.2)	$	85.3
Customer relationships		73.9		(18.2)		55.7		73.9		(13.7)		60.2
Other		4.1		(1.3)		2.8		12.9		(0.5)		12.4
		$	196.3	$	(50.5)	$	145.8	$	196.3	$	(38.4)	$	157.9

Non-amortizing intangible assets
Trademarks						462.7						462.7
Total amortizing and non-amortizing intangible assets, net						$	608.5					$	620.6

The expected future amortization of definite-life intangible assets by fiscal year (in millions):


Fiscal Year:
Remainder of 2024	$	3.8
2025	15.6
2026	15.6
2027	15.6
2028	15.9
Thereafter	79.3
Total	$	145.8

INCOME TAXES

9 Months Ended

Sep. 29, 2024

Income Tax Disclosure [Abstract]

INCOME TAXES

The following table presents the Company’s provision for income taxes (in millions):


	Thirteen Weeks Ended						Thirty-Nine Weeks Ended
	September 29, 2024			September 24, 2023			September 29, 2024			September 24, 2023
Provision (benefit) for income taxes	$	0.1		$	(1.3)		$	5.6		$	2.6
Effective tax rate	(0.3)		%	5.0		%	(4.8)		%	(4.2)		%

LEASES

9 Months Ended

Sep. 29, 2024

Leases [Abstract]

LEASES

Operating lease right-of-use assets and operating lease liabilities relating to the operating leases are as follows (in millions):


	September 29, 2024		December 31, 2023

Operating lease right-of-use assets	$	207.5	$	220.0
Right-of-use assets classified as held-for-sale	0.4		3.1
Total right-of-use assets	$	207.9	$	223.1

Operating lease liabilities	$	220.5	$	229.0
Lease liabilities related to assets held-for-sale	0.4		3.4
Total operating lease liabilities	$	220.9	$	232.4

The contractual future maturities of the Company’s operating lease liabilities as of September 29, 2024, including anticipated lease extensions, are as follows (in millions):


Fiscal year:
Remainder of 2024	$	12.2
2025	30.6
2026	27.5
2027	27.2
2028	26.2
Thereafter	346.0
Total lease payments	$	469.7
Less: imputed interest	(248.8)
Total	$	220.9

The current portion of the operating lease liability as of September 29, 2024 was $21.5 million.

Supplemental cash flow information for the thirty-nine weeks ended September 29, 2024 related to leases was as follows (in millions):


	Thirty-Nine Weeks Ended
	September 29, 2024		September 24, 2023
Cash paid for amounts included in the measurement of operating lease liabilities:
Operating cash flows from operating leases	$	22.4	$	12.9

DEBT

9 Months Ended

Sep. 29, 2024

Debt Disclosure [Abstract]

DEBT

Long-term debt consisted of the following (in millions):


	September 29, 2024								December 31, 2023
	Final Maturity	Anticipated Call Date	Rate		Face Value		Book Value		Book Value
Senior Debt
FB Royalty Securitization	4/25/2051	7/25/2026	4.75	%	$	137.0	$	134.7	$	135.9
GFG Royalty Securitization	7/25/2051	7/25/2026	6.00	%	271.2		265.9		267.7
Twin Peaks Securitization	7/25/2051	1/25/2025	7.00	%	243.7		241.5		193.7
Fazoli's/Native Securitization	7/25/2051	1/25/2025	6.00	%	126.2		125.6		126.0
FB Resid Securitization	7/25/2027		10.00	%	50.9		50.7		52.7
Senior Subordinated Debt
FB Royalty Securitization	4/25/2051	7/25/2026	8.00	%	45.7		42.5		42.1
GFG Royalty Securitization	7/25/2051	7/25/2026	7.00	%	102.2		99.0		95.9
Twin Peaks Securitization	7/25/2051	1/25/2025	9.00	%	49.0		48.6		48.6
Fazoli's/Native Securitization	7/25/2051	1/25/2025	7.00	%	24.5		23.9		17.4
FB Resid Securitization	7/25/2027		10.00	%	52.9		52.7		52.7
Subordinated Debt
FB Royalty Securitization	4/25/2051	7/25/2026	9.00	%	15.8		15.5		18.6
GFG Royalty Securitization	7/25/2051	7/25/2026	9.50	%	44.8		43.4		43.4
Twin Peaks Securitization	7/25/2051	1/25/2025	10.00	%	71.1		69.1		29.4
Fazoli's/Native Securitization	7/25/2051	1/25/2025	9.00	%	—		0.1		20.7
Total Securitized Debt					1,235.0		1,213.2		1,144.8
Elevation Note	7/19/2026	N/A	6.00	%	2.5		2.2		3.0
Twin Peaks Equipment Notes	5/5/2027 to 7/31/2028	N/A	7.99% to 11.50%		4.7		4.7		1.9


Twin Peaks Construction Loan III	12/28/2024	N/A	Prime + 1%		3.6		3.6		2.2
Twin Peaks Construction Loan IV	10/1/2025	N/A	12.5	%	3.2		3.2		—
Twin Peaks Promissory Note	10/4/2024	N/A	5.30	%	0.1		0.1		1.0

Total Debt					$	1,249.1	1,227.0		1,152.9
Current portion of long-term debt							(49.1)		(42.6)
Long-term Debt							$	1,177.9	$	1,110.3

Terms of Outstanding Debt

FB Royalty Securitization

Prior to the redemption, the Twin Peaks sellers held 2,847,393 shares of Series B Cumulative Preferred Stock.

The FB Royalty securitization notes are generally secured by a security interest in substantially all the assets of FB Royalty and its subsidiaries.

GFG Royalty Securitization

The GFG Royalty securitization notes are generally secured by a security interest in substantially all the assets of GFG Royalty and its subsidiaries.

Twin Peaks Securitization

The Twin Peaks securitization notes are generally secured by a security interest in substantially all the assets of FAT Brands Twin Peaks I, LLC and its subsidiaries.

Fazoli's / Native Securitization

The Fazoli's/Native securitization notes are generally secured by a security interest in substantially all the assets of FAT Brands Fazoli's Native I, LLC and its subsidiaries.

FB Resid Holdings 1, LLC

Retained Notes

Terms and Debt Covenant Compliance

Elevation Note

Equipment Financings (Twin Peaks)

Construction Loan Agreement (Twin Peaks)

Promissory Note (Twin Peaks)

REDEEMABLE PREFERRED STOCK	9 Months Ended
REDEEMABLE PREFERRED STOCK	Sep. 29, 2024
Equity [Abstract]
REDEEMABLE PREFERRED STOCK	REDEEMABLE PREFERRED STOCK GFG Preferred Stock Consideration On July 22, 2021, the Company completed the acquisition of GFG. A portion of the consideration paid included 3,089,245 newly issued shares of the Company’s Series B Cumulative Preferred Stock valued at $67.3 million (the "GFG Preferred Stock Consideration"). Additionally, on July 22, 2021, the Company entered into a put/call agreement with the GFG sellers, pursuant to which the Company may purchase, or the GFG Sellers may require the Company to purchase, the GFG Preferred Stock Consideration for $67.5 million plus any accrued but unpaid dividends on or before August 20, 2022 (extended from the original date of April 22, 2022), subject to the other provisions of the Put/Call Agreement. Since the Company did not deliver the applicable cash proceeds to the GFG Sellers by that date, the amount accrues interest at the rate of 5% per annum until repayment is completed. On March 22, 2022, the Company received a put notice on the GFG Preferred Stock Consideration and reclassified the GFG Preferred Stock Consideration from redeemable preferred stock to current liabilities on its consolidated balance sheet. As of September 29, 2024, the carrying value of the redeemable preferred stock was $67.5 million. On September 16, 2022, the Company entered into an agreement with one of the GFG sellers who held 1,544,623 put preferred shares. Pursuant to the agreement, effective August 23, 2022, the interest rate applicable to such holder's 1,544,623 put shares was increased from 5% to 10% per annum, payable monthly in arrears. During the thirteen and thirty-nine weeks ended September 29, 2024 the Company paid $0.9 million and $2.5 million of interest. On March 9, 2023, the Company entered into an agreement with the second GFG seller who held 1,544,623 put preferred shares. Pursuant to the agreement, effective August 23, 2022, the interest rate applicable to such holder's 1,544,623 put shares was increased from 5% to 10% per annum, payable on the date of redemption. Twin Peaks Preferred Stock Consideration On October 1, 2021, the Company completed the acquisition of Twin Peaks. A portion of the consideration paid included 2,847,393 shares of the Company’s 8.25% Series B Cumulative Preferred Stock (the "Twin Peaks Preferred Stock Consideration") valued at $67.5 million. On October 1, 2021, the Company and the Twin Peaks Seller entered into a Put/Call Agreement (the “Put/Call Agreement”) pursuant to which the Company was granted the right to call from the Twin Peaks Seller, and the Twin Peaks Seller was granted the right to put to the Company, the Initial Put/Call Shares at any time until March 31, 2022 for a cash payment of $42.5 million, and the Secondary Put/Call Shares at any time until September 30, 2022 for a cash payment of $25.0 million (the Initial Put/call Shares together with the Secondary Put/Call Shares total $67.5 million), plus any accrued but unpaid dividends on such shares. Unpaid balances, when due, accrue interest at a rate of 10.0% per annum until repayment is completed. On October 7, 2021, the Company received a put notice on the Initial Put/Call Shares and the Secondary Put/Call Shares. On October 21, 2022, the Company entered into an Exchange Agreement with the Twin Peaks Seller and redeemed 1,821,831 shares of the Company’s 8.25% Series B Cumulative Preferred Stock at a price of $23.69 per share, plus accrued and unpaid dividends to the date of redemption in exchange for $46.5 million aggregate principal amount of secured debt ($43.2 million net of debt offering costs and original issue discount) as discussed in Note 9. As of September 29, 2024, the carrying value of the Twin Peaks Preferred Stock Consideration totaled $24.3 million. The Company recognized interest expense relating to the Twin Peaks Preferred Stock Consideration for the thirteen and thirty-nine weeks ended September 29, 2024 in the amount of $0.6 million and $1.8 million.

SHARE-BASED COMPENSATION	9 Months Ended
SHARE-BASED COMPENSATION	Sep. 29, 2024
Share-Based Payment Arrangement [Abstract]
SHARE-BASED COMPENSATION	SHARE-BASED COMPENSATION Effective September 30, 2017, the Company adopted the 2017 Omnibus Equity Incentive Plan (the “Plan”). The Plan was amended on December 20, 2022 to increase the number of shares available for issuance under the Plan. The Plan is a comprehensive incentive compensation plan under which the Company can grant equity-based and other incentive awards to officers, employees and directors of, and consultants and advisers to, FAT Brands Inc. and its subsidiaries. The Plan provides a maximum of 5,000,000 shares available for grant. The Company has periodically issued stock options under the Plan. All of the stock options issued by the Company to date have included a vesting period of three years, with one-third of each grant vesting annually. As of September 29, 2024, there were 3,153,199 shares of stock options outstanding with a weighted average exercise price of $9.15. During the thirty-nine weeks ended September 29, 2024, the Company granted a total of 326,360 stock options under the Plan with a grant date fair value of $0.9 million. These stock options were grated in the first two quarters this year and there were no new grants in the third quarter. During the thirteen and thirty-nine weeks ended September 24, 2023, the Company granted a total of 188,180 and 755,087 stock options under the Plan with a grant date fair value of $0.5 million and $1.5 million, respectively. The related compensation expense will be recognized over the vesting period. The Company recognized share-based compensation expense in the amount of $0.5 million and $1.1 million during the thirteen weeks ended September 29, 2024 and September 24, 2023, respectively. The Company recognized share-based compensation expense in the amount of $2.0 million and $2.7 million during the thirty-nine weeks ended September 29, 2024 and September 24, 2023, respectively. As of September 29, 2024, there remains $1.2 million of related share-based compensation expense relating to non-vested grants, which will be recognized over the remaining vesting period of approximately 2.8 years, subject to future forfeitures.

WARRANTS

9 Months Ended

Sep. 29, 2024

Warrants

WARRANTS

The Company’s warrant activity for the thirty-nine weeks ended September 29, 2024 was as follows:


	Number of Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)
Warrants exercisable at December 31, 2023	1,048,438	$	2.95	1.6

Exercised	(154,259)	$	2.56	1.0
Warrants outstanding and exercisable at September 29, 2024	894,179	$	2.61	0.8

During the thirty-nine weeks ended September 29, 2024, 154,259 warrants were exercised in exchange for 154,259 shares of common stock with net proceeds to the Company of $0.4 million.

COMMON STOCK	9 Months Ended
COMMON STOCK	Sep. 29, 2024
Common Stock [Abstract]
COMMON STOCK	COMMON STOCK On October 29, 2024, the Board of Directors declared a cash dividend of $0.14 per share of Class A and Class B Common Stock, payable on November 29, 2024 to stockholders of record as of November 15, 2024. On November 14, 2022, we entered into an ATM Sales Agreement (the "ThinkEquity Sales Agreement") with ThinkEquity LLC (the "Agent"), pursuant to which we may offer and sell from time to time through the Agent up to 21,435,000 maximum aggregate offering price of shares of our Class A Common Stock and/or 8.25% Series B Preferred Stock. The ThinkEquity Sales Agreement with the Agent was terminated in May 2024. On July 19, 2024, we entered into an Equity Distribution Agreement (the “Noble Sales Agreement”) with Noble Capital Markets, Inc. (the “Sales Agent”), pursuant to which we may offer and sell from time to time through the Sales Agent shares (the “Placement Shares”) of our Class A Common Stock and/or 8.25% Series B Cumulative Preferred Stock. During the three months ended September 29, 2024, pursuant to the Noble Sales Agreement, the Company sold and issued 27,110 shares of Class A Common Stock, at a weighted average share price of $5.25, paid the Sales Agent commissions of $4,270 for such sales and received net proceeds of $137,950 (net of fees and commissions) for such sales. During the three months ended September 29, 2024, pursuant to the Noble Sales Agreement, the Company sold and issued 69,576 shares of 8.25% Series B Cumulative Preferred Stock, at a weighted average share price of $10.81, paid the Sales Agent commissions of $22,565 for such sales and received net proceeds of $729,336 (net of fees and commissions) for such sales.

COMMITMENTS AND CONTINGENCIES	9 Months Ended
COMMITMENTS AND CONTINGENCIES	Sep. 29, 2024
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	COMMITMENTS AND CONTINGENCIES Government Investigations and Litigation In December 2021, the U.S. Attorney’s Office for the Central District of California (the “U.S. Attorney”) and the U.S. Securities and Exchange Commission (the “SEC”) informed the Company that they had opened investigations relating to the Company and our former CEO, Andrew Wiederhorn, and were formally seeking documents and materials concerning, among other things, the Company’s December 2020 merger with Fog Cutter Capital Group Inc. (“FCCG”), transactions between those entities and Mr. Wiederhorn, as well as compensation, extensions of credit and other benefits or payments received by Mr. Wiederhorn or his family from those entities prior to the merger. On May 10, 2024, the U.S. Department of Justice (“DOJ”) indicted the Company on two violations of Section 402 of the Sarbanes-Oxley Act for directly and indirectly extending and/or arranging for the extension of credit in 2019 and 2020 to former CEO Andrew Wiederhorn in the amount of $2.65 million. These charges allege that the Company, through its subsidiary Fatburger N.A., transferred approximately $600,000 to Mr. Wiederhorn in the form of a personal loan on January 30, 2019, and lent approximately $2 million in 2020 to its former parent company FCCG which indirectly funded a personal loan from FCCG to Mr. Wiederhorn. The indictment also includes charges against Mr. Wiederhorn, the Company’s former CFO, Rebecca Hershinger, and the Company’s former tax advisor, William Amon, on violations of various federal tax and other laws related to loans from FCCG to Mr. Wiederhorn. Concurrently with the DOJ’s charges, the SEC filed a complaint against the Company, claiming violations of Section 17(a)(2) of the Securities Act of 1933; Sections 10(b), 13(a), 13(b)(2)(A), 13(b)(2)(B), 13(k), and 14(a) of the Securities Exchange Act of 1934; and Rules 10b-5(b), 12b-20, 13a-1, 13a-13, 14a-3, and 14a-9 thereunder. The SEC’s claims pertain principally to allegations that, for fiscal periods covering 2017 through 2020, the Company failed to disclose certain related party transactions, failed to disclose the salaries of Mr. Wiederhorn’s adult children working at the Company, failed to maintain proper books and records and internal accounting controls, made false or misleading statements regarding the Company’s liquidity and use of proceeds from certain transactions, and directly or indirectly extended credit to Mr. Wiederhorn in the form of a personal loan. The SEC’s complaint also names Mr. Wiederhorn, Ms. Hershinger, and the Company’s SVP of Finance, Ron Roe, as defendants. The SEC is seeking injunctive relief, disgorgement, and civil monetary penalties. The Company is evaluating these charges and intends to vigorously defend itself against them. Derivative Litigation James Harris and Adam Vignola, derivatively on behalf of FAT Brands, Inc. v. Squire Junger, James Neuhauser, Edward Rensi, Andrew Wiederhorn, Fog Cutter Holdings, LLC and Fog Cutter Capital Group, Inc., and FAT Brands Inc., nominal defendant (Delaware Chancery Court, Case No. 2021-0511) On June 10, 2021, plaintiffs James Harris and Adam Vignola (“Plaintiffs”), putative stockholders of the Company, filed a shareholder derivative action in the Delaware Court of Chancery nominally on behalf of the Company against the Company’s current and former directors (Squire Junger, James Neuhauser, Edward Rensi and Andrew Wiederhorn (the “Individual Defendants”)), and the Company’s majority stockholders, Fog Cutter Holdings, LLC and Fog Cutter Capital Group, Inc. (collectively with the Individual Defendants, “Defendants”). Plaintiffs assert claims of breach of fiduciary duty, unjust enrichment and waste of corporate assets arising out of the Company’s December 2020 merger with Fog Cutter Capital Group, Inc. Defendants filed a motion to dismiss Plaintiffs’ complaint, which the Court denied in an oral ruling on February 11, 2022 and subsequent written order on May 25, 2022. On April 7, 2022, the Court entered a Scheduling Order setting forth the key dates and deadlines that would govern the litigation, including a discovery cutoff of March 24, 2023 and trial date of February 5-9, 2024. To date, the parties have engaged in substantial written discovery, though no depositions have been taken. On February 3, 2023, the Company’s board of directors appointed a Special Litigation Committee (“SLC”), which retained independent counsel and moved for a six-month stay of the action pending resolution of the SLC's investigation, which the Court granted on February 17, 2023. On April 5, 2023, the Court granted Plaintiffs’ motion to lift the stay of the proceedings, and entered a Second Amended Pre-Trial Scheduling Order resetting key dates and deadlines, including a fact discovery cutoff of August 4, 2023, and a trial date to be set sometime after May 10, 2024. On May 4, 2023, a new SLC was appointed, and on May 8, 2023, the new SLC moved for a six-month stay of the action pending resolution of its investigation. On May 10, 2023, the United States of America moved for a partial stay of discovery pending its own investigation. On May 31, 2023, the Court granted the United States of America’s Motion, except that it granted a six-month stay of all proceedings in the action, and on that basis deemed the SLC’s motion to be moot. On December 4, 2023, the stay of all proceedings was extended through March 3, 2024, and on March 1, 2024, the stay of all proceedings was extended to June 3, 2024. On June 3, 2024, the Court granted the United States’ request to further extend the stay of all proceedings pending resolution of the charges in United States v. Wiederhorn et al., 2:24-CR-295-RGK (C.D. Cal.). Defendants dispute the allegations of the lawsuit and intend to vigorously defend against the claims. We cannot predict the outcome of this lawsuit. This lawsuit does not assert any claims against the Company. However, subject to certain limitations, we are obligated to indemnify our directors in connection with defense costs for the lawsuit and any related litigation, which may exceed coverage provided under our insurance policies, and thus could have an adverse effect on our financial condition. The lawsuit and any related litigation also may be time-consuming and divert the attention and resources of our management. James Harris and Adam Vignola, derivatively on behalf of FAT Brands, Inc. v. Squire Junger, James Neuhauser, Edward Rensi, Andrew Wiederhorn and Fog Cutter Holdings, LLC, and FAT Brands Inc., nominal defendant (Delaware Chancery Court, Case No. 2022-0254) On March 17, 2022, plaintiffs James Harris and Adam Vignola (“Plaintiffs”), putative stockholders of the Company, filed a shareholder derivative action in the Delaware Court of Chancery nominally on behalf of the Company against the Company’s current and former directors (Squire Junger, James Neuhauser, Edward Rensi and Andrew Wiederhorn (the “Individual Defendants”)), and the Company’s majority stockholder, Fog Cutter Holdings, LLC (collectively with the Individual Defendants, “Defendants”). Plaintiffs assert claims of breach of fiduciary duty in connection with the Company’s June 2021 recapitalization transaction. On May 27, 2022, Defendants filed a motion to dismiss Plaintiff's complaint (the "Motion"). Argument on the Motion was heard on November 17, 2022, and again on February 23, 2023, and the Court took its decision under advisement. The Court denied the motion on April 5, 2023. On May 2, 2023, the Court entered a pre-trial scheduling order setting key dates and deadlines that will govern the litigation, including a fact discovery cutoff of February 2, 2024, and a trial date to be set sometime after October 15, 2024. On July 21, 2023, the Company’s board of directors appointed a Special Litigation Committee (“SLC”), which retained independent counsel and moved for a six-month stay of the action pending resolution of the SLC’s investigation. On August 10, 2023, the parties filed a stipulation to stay the case for six months, conditioned upon Defendants continuing to review the documents in response to Plaintiffs' First Requests for Production and to produce non-privileged responsive documents to the SLC and to Plaintiffs no later than December 1, 2023. The Court granted the stipulation the same day. In accordance with the stipulation, Defendants produced documents to the SLC and Plaintiffs by the December 1, 2023 deadline. Subsequently, the Court granted multiple stays of the proceedings in this case, currently through November 4, 2024. Defendants dispute the allegations of the lawsuit and intend to vigorously defend against the claims. As this matter is still in the early stages, we cannot predict the outcome of this lawsuit. This lawsuit does not assert any claims against the Company. However, subject to certain limitations, we are obligated to indemnify our directors in connection with defense costs for the lawsuit and any related litigation, which may exceed coverage provided under our insurance policies, and thus could have an adverse effect on our financial condition. The lawsuit and any related litigation also may be time-consuming and divert the attention and resources of our management. Other Litigation Mitchell Kates v. FAT Brands, Inc., Andrew Wiederhorn, Kenneth J. Kuick and Robert G. Rosen (United States District Court for the Central District of California, Case No. 2:24-cv-04775-MWF-MAA) On June 7, 2024, plaintiff Mitchell Kates, a putative investor in the Company, filed a putative class action lawsuit against the Company, Andrew Wiederhorn, Kenneth J. Kuick and Robert G. Rosen, asserting claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended (the “1934 Act”), and Rule 10b-5 promulgated thereunder, alleging that the defendants made false and misleading statements and omitted material facts necessary to make statements not misleading in the Company’s reports filed with the SEC under the 1934 Act related to the subject matter of the government investigations and litigation discussed above, the Company’s handling of these matters and its cooperation with the government. The plaintiff alleges that the Company’s public statements wrongfully inflated the trading price of the Company’s common stock, preferred stock and warrants. The plaintiff is seeking to certify the complaint as a class action and is seeking compensatory damages in an amount to be determined at trial. As this matter is still in the early stages, we cannot predict the outcome of this lawsuit. Stratford Holding LLC v. Foot Locker Retail Inc. (U.S. District Court for the Western District of Oklahoma, Case No. 5:12-cv-772-HE) In 2012 and 2013, two property owners in Oklahoma City, Oklahoma sued numerous parties, including Foot Locker Retail Inc. and our subsidiary Fog Cutter Capital Group Inc. (now known as Fog Cutter Acquisition, LLC), for alleged environmental contamination on their properties, stemming from dry cleaning operations on one of the properties. The property owners seek damages in the range of $12.0 million to $22.0 million. From 2002 to 2008, a former Fog Cutter subsidiary managed a lease portfolio, which included the subject property. Fog Cutter denies any liability, although it did not timely respond to one of the property owners’ complaints and several of the defendants’ cross-complaints and thus is in default. The parties are currently conducting discovery. The court has vacated the current trial date and has not yet reset the trial date. The Company is unable to predict the ultimate outcome of this matter, however, reserves have been recorded on the balance sheet of FAT Brands relating to this litigation. There can be no assurance that the defendants will be successful in defending against these actions. SBN FCCG LLC v FCCGI (Los Angeles Superior Court, Case No. BS172606) SBN FCCG LLC (“SBN”) filed a complaint against Fog Cutter Capital Group, Inc. (“FCCG”) in New York state court for an indemnification claim (the “NY case”) stemming from an earlier lawsuit in Georgia regarding a certain lease portfolio formerly managed by a former FCCG subsidiary. In February 2018, SBN obtained a final judgment in the NY case for a total of $0.7 million, which included $0.2 million in interest dating back to March 2012. SBN then obtained a sister state judgment in Los Angeles Superior Court, Case No. BS172606 (the “California case”), which included the $0.7 million judgment from the NY case, plus additional statutory interest and fees, for a total judgment of $0.7 million. In May 2018, SBN filed a cost memo, requesting an additional $12,411 in interest to be added to the judgment in the California case, for a total of $0.7 million. In May 2019, the parties agreed to settle the matter for $0.6 million, which required the immediate payment of $0.1 million, and the balance to be paid in August 2019. FCCG wired $0.1 million to SBN in May 2019, but has not yet paid the remaining balance of $0.5 million. The parties have not entered into a formal settlement agreement, and they have not yet discussed the terms for the payment of the remaining balance. SBN FCCG LLC v FCCGI (Supreme Court of the State of New York, County of New York, Index No. 650197/2023) On January 13, 2023, SBN filed another complaint against FCCG in New York state court for an indemnification claim stemming from a lawsuit in Oklahoma City regarding the same lease portfolio formerly managed by Fog Cap (the “OKC Litigation”), and a bankruptcy proceeding involving Fog Cap (the “Bankruptcy Proceeding”). SBN alleges that under a February 2008 stock purchase agreement, Fog Cutter is required to indemnify SBN and its affiliates. According to the complaint, SBN has, at the time of filing the complaint, incurred costs subject to indemnification of approximately $12 million. On March 11, 2024, the court issued an order granting FCCG’s motion to dismiss SBN’s complaint without prejudice to refile the complaint, if at all, once the underlying proceedings (the OKC Litigation and the Bankruptcy Proceeding) were complete. On April 10, 2024, SBN filed a notice of appeal of the trial court's order dismissing SBN's complaint. We are unable at this time to express any opinion as to the eventual outcome of this matter or the possible range of loss, if any. The Company is involved in other claims and legal proceedings from time-to-time that arise in the ordinary course of business, including those involving the Company’s franchisees. The Company does not believe that the ultimate resolution of these actions will have a material adverse effect on its business, financial condition, results of operations, liquidity or capital resources. As of September 29, 2024, the Company had accrued an aggregate of $5.1 million for the specific matters mentioned above and claims and legal proceedings involving franchisees as of that date.

GEOGRAPHIC INFORMATION

9 Months Ended

Sep. 29, 2024

Geographic Information And Major Franchisees [Abstract]

GEOGRAPHIC INFORMATION

Revenue by geographic area was as follows (in millions):


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	September 29, 2024		September 24, 2023		September 29, 2024		September 24, 2023
United States	$	140.6	$	106.4	$	440.0	$	314.2
Other countries	2.8		3.0		7.4		7.6
Total revenue	$	143.4	$	109.4	$	447.4	$	321.8

Revenue is shown based on the geographic location of our company-owned and franchisees’ restaurants. All assets are located in the United States.

During the thirty-nine weeks ended September 29, 2024 and September 24, 2023, no individual franchisee accounted for more than 10% of the Company’s revenue.

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Sep. 29, 2024	Sep. 24, 2023	Sep. 29, 2024	Sep. 24, 2023
Pay vs Performance Disclosure
Net loss	$ (44,755)	$ (24,656)	$ (122,430)	$ (63,873)

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Sep. 29, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	9 Months Ended
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	Sep. 29, 2024
Accounting Policies [Abstract]
Basis of presentation	Basis of presentation – The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Our revenues are derived primarily from two sales channels, franchised restaurants and company-owned locations, which we operate as one reportable segment. The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America (“GAAP”) for complete financial statements. In the opinion of the Company, all adjustments considered necessary for the fair presentation of the Company’s results of operations, financial position and cash flows for the periods presented have been included and are of a normal, recurring nature. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company's 2023 Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the SEC on March 12, 2024.
Nature of operations	Nature of operations – The Company operates on a 52-week calendar and its fiscal year ends on the last Sunday of the calendar year. Consistent with industry practice, the Company measures its stores’ performance based upon 7-day work weeks. Using the 52-week cycle ensures consistent weekly reporting for operations and ensures that each week has the same days since certain days are more profitable than others. The use of this fiscal year means a 53rd week is added to the fiscal year every 5 or 6 years. In a 52-week year, all four quarters are comprised of 13 weeks. In a 53-week year, one extra week is added to the fourth quarter. Fiscal year 2023 was a 53-week year and 2024 is a 52-week year.
Employee Retention Tax Credits	Employee Retention Tax Credits - On March 27, 2020, the U.S. government enacted the Coronavirus Aid Relief and Security Act (the "CARES Act") to provide certain relief as a result of the COVID-19 pandemic. The CARES Act provides tax relief, along with other stimulus measures, including a provision for an Employee Retention Credit ("ERC"). As there is no authoritative guidance under U.S. GAAP on accounting for government assistance to for-profit business entities, the Company accounts for the ERC by analogy to International Accounting Standard, Accounting for Government Grants and Disclosure of Government Assistance ("IAS 20"). During the thirteen weeks ended September 29, 2024 and September 24, 2023, the Company received and recognized $1.3 million and $1.0 million, respectively, of ERCs recorded within general and administrative expense on the consolidated statements of operations. During the thirty-nine weeks ended September 29, 2024 and September 24, 2023, the Company received and recognized $3.4 million and $13.7 million, respectively, of ERCs recorded within general and administrative expense on the consolidated statements of operations.
Use of estimates in the preparation of the condensed consolidated financial statements	Use of estimates in the preparation of the condensed consolidated financial statements – The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements. Significant estimates include the determination of fair values of goodwill and other intangible assets, allowances for uncollectible notes receivable and accounts receivable, and the valuation allowance related to deferred tax assets. Estimates and assumptions also affect the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Recently Issued Accounting Standards Not Yet Adopted	Recently Issued Accounting Standards Not Yet Adopted In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The amendments improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The amendments require that a public entity disclose, on an annual and interim basis, an amount for other segment items by reportable segment and a description of its composition. The other segment items category is the difference between segment revenue less the segment expenses disclosed under the significant expense principle and each reported measure of segment profit or loss. The amendments improve financial reporting by requiring disclosure of incremental segment information on an annual and interim basis for all public entities. The amendments are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. A public entity should apply the amendments retrospectively to all prior periods presented in the financial statements. Upon transition, the segment expense categories and amounts disclosed in the prior periods should be based on the significant segment expense categories identified and disclosed in the period of adoption. The Company is currently evaluating the impact the adoption of this standard will have on its condensed consolidated financial statements. In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The amendments require that public business entities on an annual basis disclose specific categories in the rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold. The amendments also require that all entities disclose on an annual basis the income taxes paid disaggregated by jurisdiction. The amendments eliminate the requirement for all entities to disclose the nature and estimate of the range of the reasonably possible change in the unrecognized tax benefits balance in the next 12 months or make a statement that an estimate of the range cannot be made. The amendments are effective for annual periods beginning after December 15, 2024. Early adoption is permitted. The amendments should be applied on a prospective basis. Retrospective application is permitted. The Company is currently evaluating the impact the adoption of this standard will have on its condensed consolidated financial statements.

MERGERS AND ACQUISITIONS (Tables)

9 Months Ended

Sep. 29, 2024

Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The allocation of the consideration to the net tangible and intangible assets acquired is presented in the table below (in millions):


Cash	$	0.3
Accounts receivable, net of allowance	2.8
Inventory	2.6
Prepaids and other current assets	1.5
Other intangible assets, net	8.8
Goodwill	11.7
Operating lease right-of-use assets	108.9
Other assets	1.8
Property and equipment, net	18.1
Below market leases	0.2
Accounts payable	(3.6)
Accrued expenses and other liabilities	(9.9)

Operating lease liability, current portion	(3.9)
Operating lease liability, net of current portion	(105.6)

Other liabilities	(2.4)
Total net identifiable assets	$	31.3

Schedule of Proforma Revenue and Net Loss


	Thirteen Weeks Ended		Thirty-Nine Weeks Ended
	September 24, 2023
Revenue	$	146.8	$	451.5
Net loss	$	(15.8)	$	(54.7)

REFRANCHISING (Tables)

9 Months Ended

Sep. 29, 2024

Refranchising [Abstract]

Schedule of Assets Classified as Held for Sale


	September 29, 2024		December 31, 2023

Property and equipment	$	—	$	0.7
Operating lease right-of-use assets	0.4		3.1
Total	$	0.4	$	3.8

Schedule of Operating Results of Refranchising Program

The following table highlights the operating results of the Company's refranchising program (in millions):


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	September 29, 2024		September 24, 2023		September 29, 2024		September 24, 2023
Restaurant costs and expenses, net of revenue	$	0.2	$	0.4	$	0.8	$	0.8
Loss (gain) on store sales or closures	—		—		1.0		(0.1)

Refranchising loss	$	0.2	$	0.4	$	1.8	$	0.7

PROPERTY AND EQUIPMENT, NET (Tables)

9 Months Ended

Sep. 29, 2024

Property, Plant and Equipment [Abstract]

Schedule of Property and Equipment, Net

Property and equipment, net consists of the following (in millions):


	September 29, 2024		December 31, 2023
Real estate	$	93.3	$	83.5
Equipment	56.2		44.9
	149.5		128.4
Accumulated depreciation	(44.6)		(27.9)
Property and equipment, net	$	104.9	$	100.5

GOODWILL AND OTHER INTANGIBLE ASSETS, NET (Tables)

9 Months Ended

Sep. 29, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill

Changes in Carrying Value of Goodwill and Other Intangible Assets (in millions)


	Amortizing Intangible Assets		Non-Amortizing Intangible Assets
			Goodwill		Trademarks
December 31, 2023	$	157.9	$	305.1	$	462.7
Amortization	(12.1)		—		—

September 29, 2024	$	145.8	$	305.1	$	462.7

Schedule of Finite-Lived Intangible Assets

Changes in Carrying Value of Goodwill and Other Intangible Assets (in millions)


	Amortizing Intangible Assets		Non-Amortizing Intangible Assets
			Goodwill		Trademarks
December 31, 2023	$	157.9	$	305.1	$	462.7
Amortization	(12.1)		—		—

September 29, 2024	$	145.8	$	305.1	$	462.7

Gross Carrying Value and Accumulated Amortization of Other Intangible Assets (in millions)


	September 29, 2024							December 31, 2023
		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Amortizing intangible assets
Franchise agreements		$	118.3	$	(31.0)	$	87.3	$	109.5	$	(24.2)	$	85.3
Customer relationships		73.9		(18.2)		55.7		73.9		(13.7)		60.2
Other		4.1		(1.3)		2.8		12.9		(0.5)		12.4
		$	196.3	$	(50.5)	$	145.8	$	196.3	$	(38.4)	$	157.9

Non-amortizing intangible assets
Trademarks						462.7						462.7
Total amortizing and non-amortizing intangible assets, net						$	608.5					$	620.6

Schedule of Indefinite-Lived Intangible Assets

Changes in Carrying Value of Goodwill and Other Intangible Assets (in millions)


	Amortizing Intangible Assets		Non-Amortizing Intangible Assets
			Goodwill		Trademarks
December 31, 2023	$	157.9	$	305.1	$	462.7
Amortization	(12.1)		—		—

September 29, 2024	$	145.8	$	305.1	$	462.7

Gross Carrying Value and Accumulated Amortization of Other Intangible Assets (in millions)


	September 29, 2024							December 31, 2023
		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Amortizing intangible assets
Franchise agreements		$	118.3	$	(31.0)	$	87.3	$	109.5	$	(24.2)	$	85.3
Customer relationships		73.9		(18.2)		55.7		73.9		(13.7)		60.2
Other		4.1		(1.3)		2.8		12.9		(0.5)		12.4
		$	196.3	$	(50.5)	$	145.8	$	196.3	$	(38.4)	$	157.9

Non-amortizing intangible assets
Trademarks						462.7						462.7
Total amortizing and non-amortizing intangible assets, net						$	608.5					$	620.6

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense

The expected future amortization of definite-life intangible assets by fiscal year (in millions):


Fiscal Year:
Remainder of 2024	$	3.8
2025	15.6
2026	15.6
2027	15.6
2028	15.9
Thereafter	79.3
Total	$	145.8

INCOME TAXES (Tables)

9 Months Ended

Sep. 29, 2024

Income Tax Disclosure [Abstract]

Schedule of Provision for Income Taxes

The following table presents the Company’s provision for income taxes (in millions):


	Thirteen Weeks Ended						Thirty-Nine Weeks Ended
	September 29, 2024			September 24, 2023			September 29, 2024			September 24, 2023
Provision (benefit) for income taxes	$	0.1		$	(1.3)		$	5.6		$	2.6
Effective tax rate	(0.3)		%	5.0		%	(4.8)		%	(4.2)		%

LEASES (Tables)

9 Months Ended

Sep. 29, 2024

Leases [Abstract]

Schedule of Operating Lease Right of Use Assets and Operating Lease Liabilities Relating to Operating Leases

Operating lease right-of-use assets and operating lease liabilities relating to the operating leases are as follows (in millions):


	September 29, 2024		December 31, 2023

Operating lease right-of-use assets	$	207.5	$	220.0
Right-of-use assets classified as held-for-sale	0.4		3.1
Total right-of-use assets	$	207.9	$	223.1

Operating lease liabilities	$	220.5	$	229.0
Lease liabilities related to assets held-for-sale	0.4		3.4
Total operating lease liabilities	$	220.9	$	232.4

Schedule of Contractual Future Maturities of Operating Lease Liabilities

The contractual future maturities of the Company’s operating lease liabilities as of September 29, 2024, including anticipated lease extensions, are as follows (in millions):


Fiscal year:
Remainder of 2024	$	12.2
2025	30.6
2026	27.5
2027	27.2
2028	26.2
Thereafter	346.0
Total lease payments	$	469.7
Less: imputed interest	(248.8)
Total	$	220.9

Schedule of Supplemental Cash Flow Information Related to Leases

Supplemental cash flow information for the thirty-nine weeks ended September 29, 2024 related to leases was as follows (in millions):


	Thirty-Nine Weeks Ended
	September 29, 2024		September 24, 2023
Cash paid for amounts included in the measurement of operating lease liabilities:
Operating cash flows from operating leases	$	22.4	$	12.9

DEBT (Tables)

9 Months Ended

Sep. 29, 2024

Debt Disclosure [Abstract]

Schedule of Long-Term Debt

Long-term debt consisted of the following (in millions):


	September 29, 2024								December 31, 2023
	Final Maturity	Anticipated Call Date	Rate		Face Value		Book Value		Book Value
Senior Debt
FB Royalty Securitization	4/25/2051	7/25/2026	4.75	%	$	137.0	$	134.7	$	135.9
GFG Royalty Securitization	7/25/2051	7/25/2026	6.00	%	271.2		265.9		267.7
Twin Peaks Securitization	7/25/2051	1/25/2025	7.00	%	243.7		241.5		193.7
Fazoli's/Native Securitization	7/25/2051	1/25/2025	6.00	%	126.2		125.6		126.0
FB Resid Securitization	7/25/2027		10.00	%	50.9		50.7		52.7
Senior Subordinated Debt
FB Royalty Securitization	4/25/2051	7/25/2026	8.00	%	45.7		42.5		42.1
GFG Royalty Securitization	7/25/2051	7/25/2026	7.00	%	102.2		99.0		95.9
Twin Peaks Securitization	7/25/2051	1/25/2025	9.00	%	49.0		48.6		48.6
Fazoli's/Native Securitization	7/25/2051	1/25/2025	7.00	%	24.5		23.9		17.4
FB Resid Securitization	7/25/2027		10.00	%	52.9		52.7		52.7
Subordinated Debt
FB Royalty Securitization	4/25/2051	7/25/2026	9.00	%	15.8		15.5		18.6
GFG Royalty Securitization	7/25/2051	7/25/2026	9.50	%	44.8		43.4		43.4
Twin Peaks Securitization	7/25/2051	1/25/2025	10.00	%	71.1		69.1		29.4
Fazoli's/Native Securitization	7/25/2051	1/25/2025	9.00	%	—		0.1		20.7
Total Securitized Debt					1,235.0		1,213.2		1,144.8
Elevation Note	7/19/2026	N/A	6.00	%	2.5		2.2		3.0
Twin Peaks Equipment Notes	5/5/2027 to 7/31/2028	N/A	7.99% to 11.50%		4.7		4.7		1.9


Twin Peaks Construction Loan III	12/28/2024	N/A	Prime + 1%		3.6		3.6		2.2
Twin Peaks Construction Loan IV	10/1/2025	N/A	12.5	%	3.2		3.2		—
Twin Peaks Promissory Note	10/4/2024	N/A	5.30	%	0.1		0.1		1.0

Total Debt					$	1,249.1	1,227.0		1,152.9
Current portion of long-term debt							(49.1)		(42.6)
Long-term Debt							$	1,177.9	$	1,110.3

WARRANTS (Tables)

9 Months Ended

Sep. 29, 2024

Warrants

Schedule of Warrant Activity

The Company’s warrant activity for the thirty-nine weeks ended September 29, 2024 was as follows:


	Number of Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)
Warrants exercisable at December 31, 2023	1,048,438	$	2.95	1.6

Exercised	(154,259)	$	2.56	1.0
Warrants outstanding and exercisable at September 29, 2024	894,179	$	2.61	0.8

GEOGRAPHIC INFORMATION (Tables)

9 Months Ended

Sep. 29, 2024

Geographic Information And Major Franchisees [Abstract]

Schedule of Revenues by Geographic Area

Revenue by geographic area was as follows (in millions):


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	September 29, 2024		September 24, 2023		September 29, 2024		September 24, 2023
United States	$	140.6	$	106.4	$	440.0	$	314.2
Other countries	2.8		3.0		7.4		7.6
Total revenue	$	143.4	$	109.4	$	447.4	$	321.8

ORGANIZATION AND RELATIONSHIPS (Details) $ in Thousands	3 Months Ended		9 Months Ended
ORGANIZATION AND RELATIONSHIPS (Details) $ in Thousands	Sep. 29, 2024 USD ($) location	Sep. 24, 2023 USD ($)	Sep. 29, 2024 USD ($) location franchise	Sep. 24, 2023 USD ($)	Dec. 31, 2023 USD ($)
Debt Securities, Available-for-Sale [Line Items]
Number of franchise brands \| franchise			18
Number of locations \| location	2,300		2,300
Percent of total restaurants franchised (as a percent)	92.00%		92.00%
Income (loss) from operations	$ (8,833)	$ 6,621	$ (12,918)	$ 25,473
Accumulated deficit	391,207		391,207		$ 268,777
Negative working capital	210,800		210,800
Redeemable preferred stock	91,836		91,836		91,836
Unrestricted cash	16,837		16,837		$ 37,044
Face amount of debt	1,249,100		1,249,100
Fixed Rate Secured Notes
Debt Securities, Available-for-Sale [Line Items]
Face amount of debt	71,500		71,500
Repurchased amount of notes	$ 95,000		$ 95,000

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 29, 2024 USD ($)	Sep. 24, 2023 USD ($)	Sep. 29, 2024 USD ($) salesChannel segment	Sep. 24, 2023 USD ($)
Accounting Policies [Abstract]
Number of sales channels \| salesChannel			2
Number of reportable segments \| segment			1
CARES Act, ERCs received \| $	$ 1.3	$ 1.0	$ 3.4	$ 13.7

MERGERS AND ACQUISITIONS - Narrative (Details) - Barbeque Holding LLC $ in Millions	Sep. 25, 2023 USD ($)
Business Acquisition [Line Items]
Fair value of net assets and liabilities acquired	$ 31.3
Identifiable intangible assets acquired	$ 8.8

MERGERS AND ACQUISITIONS - Recognized Identified Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands	Sep. 29, 2024	Dec. 31, 2023	Sep. 25, 2023
Business Acquisition [Line Items]
Goodwill	$ 305,054	$ 305,089
Barbeque Holding LLC
Business Acquisition [Line Items]
Cash			$ 300
Accounts receivable, net of allowance			2,800
Inventory			2,600
Prepaids and other current assets			1,500
Other intangible assets, net			8,800
Goodwill			11,700
Operating lease right-of-use assets			108,900
Other assets			1,800
Property and equipment, net			18,100
Below market leases			200
Accounts payable			(3,600)
Accrued expenses and other liabilities			(9,900)
Operating lease liability, current portion			(3,900)
Operating lease liability, net of current portion			(105,600)
Other liabilities			(2,400)
Total net identifiable assets			$ 31,300

MERGERS AND ACQUISITIONS - Schedule of Pro Forma Revenue and Net Loss (Details) - Barbeque Holding LLC - USD ($) $ in Millions	3 Months Ended	9 Months Ended
	Sep. 24, 2023	Sep. 24, 2023
Business Acquisition [Line Items]
Revenue	$ 146.8	$ 451.5
Net loss	$ (15.8)	$ (54.7)

REFRANCHISING - Schedule of Remaining Assets Classified as Held for Sale (Details) - USD ($) $ in Thousands	Sep. 29, 2024	Dec. 31, 2023
Refranchising [Abstract]
Property and equipment	$ 0	$ 700
Operating lease right-of-use assets	400	3,100
Total	$ 370	$ 3,756

REFRANCHISING - Narrative (Details) - USD ($) $ in Thousands	Sep. 29, 2024	Dec. 31, 2023
Refranchising [Abstract]
Operating lease liabilities related to the assets classified as held for sale	$ 393	$ 3,421

REFRANCHISING - Schedule of Operating Results of Refranchising Program (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 29, 2024	Sep. 24, 2023	Sep. 29, 2024	Sep. 24, 2023
Long-Lived Assets Held-for-Sale [Line Items]
Refranchising loss	$ 157	$ 408	$ 1,840	$ 746
Restaurant Sales \| Assets Classified as Held for Sale
Long-Lived Assets Held-for-Sale [Line Items]
Restaurant costs and expenses, net of revenue	200	400	800	800
Loss (gain) on store sales or closures	0	0	1,000	(100)
Refranchising loss	$ 200	$ 400	$ 1,800	$ 700

PROPERTY AND EQUIPMENT, NET - Schedule of Carrying Value of Property and Equipment (Details) - USD ($) $ in Thousands	Sep. 29, 2024	Dec. 31, 2023
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 149,500	$ 128,400
Accumulated depreciation	(44,600)	(27,900)
Property and equipment, net	104,938	100,524
Real estate
Property, Plant and Equipment [Line Items]
Property and equipment, gross	93,300	83,500
Equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 56,200	$ 44,900

PROPERTY AND EQUIPMENT, NET - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 29, 2024	Sep. 24, 2023	Sep. 29, 2024	Sep. 24, 2023
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 5,900	$ 3,200	$ 17,500	$ 9,900
Loss on disposals			$ 258	$ 0

GOODWILL AND OTHER INTANGIBLE ASSETS, NET - Changes in Carrying Value of Goodwill and Other Intangible Assets (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 29, 2024	Sep. 24, 2023	Sep. 29, 2024	Sep. 24, 2023
Amortizing Intangible Assets
Amortizing Intangible Assets, Beginning balance			$ 157,900
Amortization	$ (4,300)	$ (3,800)	(12,100)	$ (11,300)
Amortizing Intangible Assets, Ending balance	145,800		145,800
Goodwill
Goodwill, Beginning balance			305,089
Goodwill, Ending balance	305,054		305,054
Trademarks
Trademarks
Trademarks, Beginning balance			462,700
Trademarks, Ending balance	$ 462,700		$ 462,700

GOODWILL AND OTHER INTANGIBLE ASSETS, NET - Gross Carrying Value and Accumulated Amortization (Details) - USD ($) $ in Thousands	Sep. 29, 2024	Dec. 31, 2023
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 196,300	$ 196,300
Accumulated Amortization	(50,500)	(38,400)
Net Carrying Amount	145,800	157,900
Total amortizing and non-amortizing intangible assets, net	608,458	620,622
Trademarks
Finite-Lived Intangible Assets [Line Items]
Non-amortizing intangible assets	462,700	462,700
Franchise agreements
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	118,300	109,500
Accumulated Amortization	(31,000)	(24,200)
Net Carrying Amount	87,300	85,300
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	73,900	73,900
Accumulated Amortization	(18,200)	(13,700)
Net Carrying Amount	55,700	60,200
Other
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	4,100	12,900
Accumulated Amortization	(1,300)	(500)
Net Carrying Amount	$ 2,800	$ 12,400

GOODWILL AND OTHER INTANGIBLE ASSETS, NET - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 29, 2024	Sep. 24, 2023	Sep. 29, 2024	Sep. 24, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization expense	$ 4.3	$ 3.8	$ 12.1	$ 11.3

GOODWILL AND OTHER INTANGIBLE ASSETS, NET - Expected Future Amortization (Details) - USD ($) $ in Millions	Sep. 29, 2024	Dec. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
Remainder of 2024	$ 3.8
2025	15.6
2026	15.6
2027	15.6
2028	15.9
Thereafter	79.3
Net Carrying Amount	$ 145.8	$ 157.9

INCOME TAXES (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
INCOME TAXES (Details) - USD ($) $ in Thousands	Sep. 29, 2024	Sep. 24, 2023	Sep. 29, 2024	Sep. 24, 2023
Income Tax Disclosure [Abstract]
Provision (benefit) for income taxes	$ 143	$ (1,310)	$ 5,568	$ 2,572
Effective tax rate	(0.30%)	5.00%	(4.80%)	(4.20%)

INCOME TAXES - Narrative (Details)	3 Months Ended		9 Months Ended
INCOME TAXES - Narrative (Details)	Sep. 29, 2024	Sep. 24, 2023	Sep. 29, 2024	Sep. 24, 2023
Income Tax Disclosure [Abstract]
Statutory tax rate	21.00%	21.00%	21.00%	21.00%
Effective tax rate	(0.30%)	5.00%	(4.80%)	(4.20%)

LEASES - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
LEASES - Narrative (Details) - USD ($) $ in Thousands	Sep. 29, 2024	Sep. 24, 2023	Sep. 29, 2024	Sep. 24, 2023	Dec. 31, 2023
Leases [Abstract]
Lease expense recognized	$ 8,000	$ 4,600	$ 24,000	$ 14,100
Current portion of the operating lease liability	$ 21,499		$ 21,499		$ 17,254

LEASES - Schedule of Operating Lease Right of Use Assets and Operating Lease Liabilities (Details) - USD ($) $ in Millions	Sep. 29, 2024	Dec. 31, 2023
Lessor, Lease, Description [Line Items]
Operating lease right-of-use assets	$ 207.9	$ 223.1
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration]	Assets classified as held-for-sale, Operating lease right-of-use assets	Assets classified as held-for-sale, Operating lease right-of-use assets
Total operating lease liabilities	$ 220.9	$ 232.4
Continuing Operations
Lessor, Lease, Description [Line Items]
Operating lease right-of-use assets	207.5	220.0
Total operating lease liabilities	220.5	229.0
Discontinued Operations, Held-for-Sale
Lessor, Lease, Description [Line Items]
Operating lease right-of-use assets	0.4	3.1
Total operating lease liabilities	$ 0.4	$ 3.4

LEASES - Schedule of Contractual Future Maturities (Details) - USD ($) $ in Millions	Sep. 29, 2024	Dec. 31, 2023
Leases [Abstract]
Remainder of 2024	$ 12.2
2025	30.6
2026	27.5
2027	27.2
2028	26.2
Thereafter	346.0
Total lease payments	469.7
Less: imputed interest	(248.8)
Total	$ 220.9	$ 232.4

LEASES - Schedule of Supplemental Cash Flow Information (Details) - USD ($) $ in Millions	9 Months Ended
	Sep. 29, 2024	Sep. 24, 2023
Leases [Abstract]
Operating cash flows from operating leases	$ 22.4	$ 12.9

DEBT - Schedule of Long-Term Debt (Details) - USD ($) $ in Thousands		9 Months Ended
	Dec. 28, 2023	Sep. 29, 2024	Sep. 20, 2024	Jun. 30, 2024	Mar. 31, 2024	Mar. 20, 2024	Dec. 31, 2023	Dec. 04, 2023	Oct. 31, 2023	Sep. 24, 2023	Sep. 20, 2023	Sep. 08, 2023	Jan. 31, 2023	Dec. 25, 2022	Dec. 15, 2022	Oct. 21, 2022	Sep. 25, 2022	Jul. 06, 2022	Dec. 15, 2021	Oct. 01, 2021	Jul. 22, 2021	Apr. 26, 2021	Jun. 19, 2019
Debt Instrument [Line Items]
Face Value		$ 1,249,100
Book Value		1,227,000					$ 1,152,900
Current portion of long-term debt		(49,141)					(42,611)
Long-term Debt		1,177,921					$ 1,110,308
FB Royalty Securitization
Debt Instrument [Line Items]
Face Value																$ 46,500	$ 30,000	$ 76,500				$ 144,500
Book Value																$ 43,200
GFG Royalty Securitization
Debt Instrument [Line Items]
Face Value		$ 25,300							$ 20,200		$ 2,800		$ 40,000		$ 113,500						$ 350,000
Twin Peaks Securitization
Debt Instrument [Line Items]
Face Value				$ 11,200	$ 38,800	$ 50,000				$ 48,000		$ 98,000								$ 250,000
Fazoli's/Native Securitization
Debt Instrument [Line Items]
Face Value																			$ 193,800
Elevation Note
Debt Instrument [Line Items]
Rate																							6.00%
Face Value																							$ 7,500
Twin Peaks Equipment Notes
Debt Instrument [Line Items]
Rate		11.50%					11.50%
Twin Peaks Equipment Notes \| Minimum
Debt Instrument [Line Items]
Rate														7.99%
Twin Peaks Equipment Notes \| Maximum
Debt Instrument [Line Items]
Rate														8.49%
Senior Debt \| FB Royalty Securitization
Debt Instrument [Line Items]
Rate		4.75%
Face Value		$ 137,000
Book Value		$ 134,700					$ 135,900
Senior Debt \| GFG Royalty Securitization
Debt Instrument [Line Items]
Rate		6.00%
Face Value		$ 271,200
Book Value		$ 265,900					267,700
Senior Debt \| Twin Peaks Securitization
Debt Instrument [Line Items]
Rate		7.00%
Face Value		$ 243,700
Book Value		$ 241,500					193,700
Senior Debt \| Fazoli's/Native Securitization
Debt Instrument [Line Items]
Rate		6.00%
Face Value		$ 126,200
Book Value		$ 125,600					126,000
Senior Debt \| FB Resid Securitization
Debt Instrument [Line Items]
Rate		10.00%
Face Value		$ 50,900
Book Value		$ 50,700					52,700
Senior Subordinated Debt \| FB Royalty Securitization
Debt Instrument [Line Items]
Rate		8.00%
Face Value		$ 45,700
Book Value		$ 42,500					42,100
Senior Subordinated Debt \| GFG Royalty Securitization
Debt Instrument [Line Items]
Rate		7.00%
Face Value		$ 102,200
Book Value		$ 99,000					95,900
Senior Subordinated Debt \| Twin Peaks Securitization
Debt Instrument [Line Items]
Rate		9.00%
Face Value		$ 49,000
Book Value		$ 48,600					48,600
Senior Subordinated Debt \| Fazoli's/Native Securitization
Debt Instrument [Line Items]
Rate		7.00%
Face Value		$ 24,500
Book Value		$ 23,900					17,400
Senior Subordinated Debt \| FB Resid Securitization
Debt Instrument [Line Items]
Rate		10.00%
Face Value		$ 52,900
Book Value		$ 52,700					52,700
Subordinated Debt \| FB Royalty Securitization
Debt Instrument [Line Items]
Rate		9.00%
Face Value		$ 15,800
Book Value		$ 15,500					18,600
Subordinated Debt \| GFG Royalty Securitization
Debt Instrument [Line Items]
Rate		9.50%
Face Value		$ 44,800
Book Value		$ 43,400					43,400
Subordinated Debt \| Twin Peaks Securitization
Debt Instrument [Line Items]
Rate		10.00%
Face Value		$ 71,100
Book Value		$ 69,100					29,400
Subordinated Debt \| Fazoli's/Native Securitization
Debt Instrument [Line Items]
Rate		9.00%
Face Value		$ 0
Book Value		100					20,700
Securitized Debt
Debt Instrument [Line Items]
Face Value		1,235,000
Book Value		$ 1,213,200					1,144,800
Notes Payable \| Elevation Note
Debt Instrument [Line Items]
Rate		6.00%
Face Value		$ 2,500
Book Value		2,200					3,000
Notes Payable \| Twin Peaks Equipment Notes
Debt Instrument [Line Items]
Face Value		4,700
Book Value		$ 4,700					1,900
Notes Payable \| Twin Peaks Equipment Notes \| Minimum
Debt Instrument [Line Items]
Rate		7.99%
Notes Payable \| Twin Peaks Equipment Notes \| Maximum
Debt Instrument [Line Items]
Rate		11.50%
Notes Payable \| Twin Peaks Promissory Note
Debt Instrument [Line Items]
Rate		5.30%						5.30%
Face Value		$ 100						$ 1,000
Book Value		$ 100					1,000
Construction Loan \| Twin Peaks Construction Loan III
Debt Instrument [Line Items]
Basis spread on variable rate (as a percent)	1.00%	1.00%
Face Value	$ 4,750	$ 3,600
Book Value		$ 3,600					2,200
Construction Loan \| Twin Peaks Construction Loan IV
Debt Instrument [Line Items]
Rate		12.50%	12.50%
Face Value		$ 3,200	$ 3,200
Book Value		$ 3,200					$ 0

DEBT - Narrative (Details) $ / shares in Units, $ in Thousands								1 Months Ended		3 Months Ended						9 Months Ended		12 Months Ended
	Dec. 28, 2023 USD ($)	Dec. 04, 2023 USD ($) payment	Sep. 20, 2023 USD ($)	Jul. 26, 2023	Jul. 08, 2023 USD ($) tranche	Oct. 21, 2022 USD ($) $ / shares shares	Oct. 01, 2021 USD ($) tranche	Oct. 31, 2023 USD ($)	Jan. 31, 2023 USD ($)	Sep. 29, 2024 USD ($) $ / shares shares	Jun. 30, 2024 USD ($)	Mar. 31, 2024 USD ($)	Sep. 24, 2023 USD ($)	Dec. 25, 2022 USD ($)	Sep. 25, 2022 USD ($)	Sep. 29, 2024 USD ($) $ / shares shares	Sep. 24, 2023 USD ($)	Dec. 31, 2023 USD ($) $ / shares shares	Sep. 20, 2024 USD ($)	Mar. 20, 2024 USD ($) tranche	Sep. 08, 2023 USD ($) tranche	Dec. 15, 2022 USD ($) tranche	Oct. 20, 2022 shares	Jul. 06, 2022 USD ($) tranche	Dec. 15, 2021 USD ($) tranche	Jul. 22, 2021 USD ($) tranche	Apr. 26, 2021 USD ($) tranche	Jun. 19, 2019 USD ($) $ / shares
Debt Instrument [Line Items]
Face amount of debt										$ 1,249,100						$ 1,249,100
Debt outstanding										$ 1,227,000						$ 1,227,000		$ 1,152,900
Preferred stock, outstanding (in shares) \| shares										3,782,459						3,782,459		3,591,804
Proceeds from borrowings, net of issuance costs																$ 110,879	$ 194,163
Net gain (loss) on extinguishment of debt										$ 0			$ (2,723)			$ 427	(2,723)
Common stock, par value (in dollars per share) \| $ / shares										$ 0.0001						$ 0.0001		$ 0.0001
Acquisition of interest in joint venture, consideration		$ 1,300
Acquisition of interest in joint venture, cash payments		$ 300
Acquisition of interest in joint venture, number of monthly payments \| payment		10
Acquisition of interest in joint venture, installment payments		$ 100
Twin Peaks
Debt Instrument [Line Items]
Interest rate (as a percent)						10.00%						10.00%
Repayments of debt												$ 1,000
Twin Peaks \| Exchange Arrangement One
Debt Instrument [Line Items]
Option multiplier						0.86
Twin Peaks \| Exchange Arrangement Two
Debt Instrument [Line Items]
Option multiplier						0.94
Twin Peaks \| Exchange Arrangement Three
Debt Instrument [Line Items]
Option multiplier						0.91
Series B Cumulative Preferred Stock \| Twin Peaks
Debt Instrument [Line Items]
Redeemed shares (in shares) \| shares						1,821,831
Dividend rate on preferred stock						8.25%	8.25%
Preferred stock redemption price (in dollars per share) \| $ / shares						$ 23.69
Preferred stock, outstanding (in shares) \| shares																							2,847,393
FB Royalty Securitization
Debt Instrument [Line Items]
Number of tranches \| tranche																								3			3
Face amount of debt						$ 46,500									$ 30,000									$ 76,500			$ 144,500
Net proceeds															27,100
Debt offering costs															600
Unamortized discount															$ 2,300
Debt outstanding						$ 43,200
GFG Royalty Securitization
Debt Instrument [Line Items]
Number of tranches \| tranche																						3				3
Face amount of debt			$ 2,800					$ 20,200	$ 40,000	$ 25,300						$ 25,300						$ 113,500				$ 350,000
Proceeds from borrowings, net of issuance costs			$ 2,500					$ 18,100	$ 34,800					$ 25,000
Twin Peaks Securitization
Debt Instrument [Line Items]
Number of tranches \| tranche							3													1	2
Face amount of debt							$ 250,000				$ 11,200	38,800	48,000				48,000			$ 50,000	$ 98,000
Proceeds from borrowings, net of issuance costs											$ 10,700	36,400	45,200
Debt instrument, repurchase amount												7,400	$ 14,900				$ 14,900
Net gain (loss) on extinguishment of debt												$ 400
Twin Peaks Securitization \| Subsidiaries
Debt Instrument [Line Items]
Face amount of debt										50,000						50,000
Proceeds from sale of debt																50,000
Fazoli's/Native Securitization
Debt Instrument [Line Items]
Number of tranches \| tranche																									3
Face amount of debt																									$ 193,800
Fixed Rate Secured Notes
Debt Instrument [Line Items]
Face amount of debt										71,500						71,500
Fixed Rate Secured Notes \| Subsidiaries
Debt Instrument [Line Items]
Number of tranches \| tranche					2
Face amount of debt					$ 150,000					44,200						44,200
Proceeds from borrowings, net of issuance costs					105,300
Debt instrument, repurchase amount					64,600
Amount of debt sold					$ 105,800
Retained Notes \| Subsidiaries
Debt Instrument [Line Items]
Debt outstanding										166,500						166,500
Proceeds from sale of debt																102,200
Cash used to repurchase debt																32,400
2021 Securitization Notes
Debt Instrument [Line Items]
Increase in interest rate (as a percent)				1.00%
Principal payment (as a percent)				2.00%
Elevation Note
Debt Instrument [Line Items]
Face amount of debt																												$ 7,500
Interest rate (as a percent)																												6.00%
Common stock, par value (in dollars per share) \| $ / shares																												$ 12.00
Elevation Note \| Notes Payable
Debt Instrument [Line Items]
Face amount of debt										2,500						2,500
Debt outstanding										$ 2,200						$ 2,200		$ 3,000
Interest rate (as a percent)										6.00%						6.00%
Twin Peaks Equipment Notes
Debt Instrument [Line Items]
Interest rate (as a percent)										11.50%						11.50%		11.50%
Maximum borrowing capacity										$ 4,200				$ 1,400		$ 4,200		$ 1,400
Debt instrument, term																48 months		48 months
Twin Peaks Equipment Notes \| Notes Payable
Debt Instrument [Line Items]
Face amount of debt										4,700						$ 4,700
Debt outstanding										$ 4,700						$ 4,700		$ 1,900
Twin Peaks Equipment Notes \| Minimum
Debt Instrument [Line Items]
Interest rate (as a percent)														7.99%
Twin Peaks Equipment Notes \| Minimum \| Notes Payable
Debt Instrument [Line Items]
Interest rate (as a percent)										7.99%						7.99%
Twin Peaks Equipment Notes \| Maximum
Debt Instrument [Line Items]
Interest rate (as a percent)														8.49%
Twin Peaks Equipment Notes \| Maximum \| Notes Payable
Debt Instrument [Line Items]
Interest rate (as a percent)										11.50%						11.50%
Twin Peaks Construction Loan III \| Construction Loan
Debt Instrument [Line Items]
Face amount of debt	$ 4,750									$ 3,600						$ 3,600
Debt outstanding										3,600						$ 3,600		2,200
Debt term extension period	12 months
Basis spread on variable rate (as a percent)	1.00%															1.00%
Twin Peaks Construction Loan IV \| Construction Loan
Debt Instrument [Line Items]
Face amount of debt										3,200						$ 3,200			$ 3,200
Debt outstanding										$ 3,200						$ 3,200		0
Interest rate (as a percent)										12.50%						12.50%			12.50%
Twin Peaks Promissory Note \| Notes Payable
Debt Instrument [Line Items]
Face amount of debt		$ 1,000								$ 100						$ 100
Debt outstanding										$ 100						$ 100		$ 1,000
Interest rate (as a percent)		5.30%								5.30%						5.30%

REDEEMABLE PREFERRED STOCK (Details) - USD ($) $ / shares in Units, $ in Thousands				3 Months Ended		9 Months Ended
	Oct. 21, 2022	Oct. 01, 2021	Jul. 22, 2021	Sep. 29, 2024	Sep. 24, 2023	Sep. 29, 2024	Sep. 24, 2023	Dec. 31, 2023	Mar. 09, 2023	Oct. 20, 2022	Sep. 25, 2022	Sep. 16, 2022	Jul. 06, 2022	Apr. 26, 2021
Class of Stock [Line Items]
Preferred stock, outstanding (in shares)				3,782,459		3,782,459		3,591,804
Interest expense related to preferred shares				$ 4,418	$ 4,417	$ 13,253	$ 13,771
Face amount of debt				1,249,100		1,249,100
Principal amount, net of offering costs and original issue discount				1,227,000		1,227,000		$ 1,152,900
FB Royalty Securitization
Class of Stock [Line Items]
Face amount of debt	$ 46,500										$ 30,000		$ 76,500	$ 144,500
Principal amount, net of offering costs and original issue discount	$ 43,200
Series B Cumulative Preferred Stock \| Twin Peaks
Class of Stock [Line Items]
Preferred stock, outstanding (in shares)										2,847,393
Dividend rate on preferred stock	8.25%	8.25%
Redeemable preferred stock (in shares)	1,821,831
Preferred stock redemption price (in dollars per share)	$ 23.69
Series B Cumulative Preferred Stock \| GFG Sellers
Class of Stock [Line Items]
Preferred stock, interest rate			5.00%						10.00%			10.00%
Preferred stock, outstanding (in shares)									1,544,623			1,544,623
Interest expense related to preferred shares				900		2,500
GFG Holdings Inc
Class of Stock [Line Items]
Value of equity interests related to put/call agreement			$ 67,500
Preferred stock, interest rate			5.00%
Carrying value of redeemable preferred stock				67,500		67,500
GFG Holdings Inc \| Series B Cumulative Preferred Stock
Class of Stock [Line Items]
Temporary equity issued (in shares)			3,089,245
Temporary equity issued			$ 67,300
Twin Peaks
Class of Stock [Line Items]
Carrying value of redeemable preferred stock				24,300		24,300
Contingent consideration, range of outcomes, high		$ 42,500
Contingent consideration, range of outcomes, low		$ 25,000
Dividends paid in cash on redeemable preferred stock				$ 600		$ 1,800
Twin Peaks \| Series B Cumulative Preferred Stock
Class of Stock [Line Items]
Temporary equity issued (in shares)		2,847,393
Temporary equity issued		$ 67,500
Interest rate on unpaid cash proceeds related to acquisition		10.00%

SHARE-BASED COMPENSATION (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		9 Months Ended
	Sep. 29, 2024	Sep. 24, 2023	Sep. 29, 2024	Sep. 24, 2023
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options outstanding through share-based compensation agreement (in shares)	3,153,199		3,153,199
Weighted average exercise price of options (in dollars per share)	$ 9.15		$ 9.15
Number of options granted (in shares)		188,180	326,360	755,087
Grant date fair value of options granted		$ 0.5	$ 0.9	$ 1.5
Share-based compensation plan expense	$ 0.5	$ 1.1	2.0	$ 2.7
Share-based compensation expense related to non-vested grants	$ 1.2		$ 1.2
Period for recognition of share-based compensation expense for non-vested grants			2 years 9 months 18 days
Employee Stock Option
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period			3 years
Employee Stock Option \| Tranche One
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting rights (as a percent)			33.33%
Employee Stock Option \| Tranche Two
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting rights (as a percent)			33.33%
Employee Stock Option \| Tranche Three
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting rights (as a percent)			33.33%
Maximum \| 2017 Omnibus Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares available for grant (in shares)	5,000,000		5,000,000

WARRANTS - Warrant Activity (Details) - Warrant - $ / shares	9 Months Ended	12 Months Ended
	Sep. 29, 2024	Dec. 31, 2023
Number of Shares
Warrants outstanding, Beginning balance (in shares)	1,048,438
Exercised (in shares)	(154,259)
Warrants outstanding, Ending balance (in shares)	894,179	1,048,438
Warrants exercisable (in shares)	894,179
Weighted Average Exercise Price
Outstanding warrants, Beginning balance (in dollars per share)	$ 2.95
Exercised (in dollars per share)	2.56
Outstanding warrants, Ending balance (in dollars per share)	2.61	$ 2.95
Weighted average exercise price of warrants exercisable (in dollars per share)	$ 2.61
Weighted Average Remaining Contractual Life (Years)
Weighted average remaining contractual life (in years) of warrants outstanding	9 months 18 days	1 year 7 months 6 days
Weighted average remaining contractual life (in years) of warrants exercised	1 year

WARRANTS - Narrative (Details) $ in Millions	9 Months Ended
WARRANTS - Narrative (Details) $ in Millions	Sep. 29, 2024 USD ($) shares
Warrant Activity
Common stock issued through exercise of warrants (in shares)	154,259
Net proceeds from exercise of warrants \| $	$ 0.4
Warrant
Warrant Activity
Warrants exercised (in shares)	154,259

COMMON STOCK (Details) - USD ($)				3 Months Ended		9 Months Ended
COMMON STOCK (Details) - USD ($)	Oct. 29, 2024	Jul. 19, 2024	Nov. 14, 2022	Sep. 29, 2024	Sep. 24, 2023	Sep. 29, 2024	Sep. 24, 2023
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Cash dividends declared per common share (in dollars per share)				$ 0.14	$ 0.14	$ 0.42	$ 0.42
Issuance of common and preferred stock				$ 1,027,000	$ 2,165,000	$ 3,061,000	$ 3,817,000
Subsequent Event
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Cash dividends declared per common share (in dollars per share)	$ 0.14
ThinkEquity LLC \| Common Class A \| ATM Sales Agreement
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Maximum aggregate offering price			$ 21,435,000
ThinkEquity LLC \| Series B Preferred Stock \| ATM Sales Agreement
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Dividend rate on preferred stock			8.25%
Noble Capital Markets, Inc \| Common Class A \| Equity Distribution Agreement
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Issuance of preferred stock (in shares)				27,110
Weighted average price per share (in dollars per share)				$ 5.25		$ 5.25
Payments of stock issuance costs				$ 4,270
Issuance of common and preferred stock				$ 137,950
Noble Capital Markets, Inc \| Series B Preferred Stock \| Equity Distribution Agreement
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Dividend rate on preferred stock		8.25%		8.25%
Issuance of preferred stock (in shares)				69,576
Weighted average price per share (in dollars per share)				$ 10.81		$ 10.81
Payments of stock issuance costs				$ 22,565
Issuance of common and preferred stock				$ 729,336

COMMITMENTS AND CONTINGENCIES (Details)							1 Months Ended			9 Months Ended	12 Months Ended	23 Months Ended
COMMITMENTS AND CONTINGENCIES (Details)	Aug. 10, 2023	Jul. 21, 2023	May 31, 2023	May 08, 2023	Feb. 03, 2023	Jan. 30, 2019 USD ($)	May 31, 2019 USD ($)	May 31, 2018 USD ($)	Feb. 28, 2018 USD ($)	Sep. 29, 2024 USD ($)	Dec. 27, 2020 USD ($)	Dec. 27, 2020 USD ($)	May 10, 2024 violation	Jan. 13, 2023 USD ($)
SBN FCCG LLC
Loss Contingencies [Line Items]
Payments for legal settlements							$ 100,000
Estimated litigation liability										$ 500,000
Minimum
Loss Contingencies [Line Items]
Damages sought										12,000,000.0
Maximum
Loss Contingencies [Line Items]
Damages sought										22,000,000.0
Related Party
Loss Contingencies [Line Items]
Payment for origination of related party notes receivable												$ 2,650,000
Chief Executive Officer
Loss Contingencies [Line Items]
Payment for origination of related party notes receivable						$ 600,000
Parent Company
Loss Contingencies [Line Items]
Payment for origination of related party notes receivable											$ 2,000,000
Government Investigations and Litigation
Loss Contingencies [Line Items]
Number of violations \| violation													2
Shareholder Derivative Action Related To the December 2020 Merger With Fog Cutter Capital Group
Loss Contingencies [Line Items]
Litigation case, stay of action, period			6 months	6 months	6 months
Shareholder Derivative Action Related To The Company's June 2021 Recapitalization Transaction
Loss Contingencies [Line Items]
Litigation case, stay of action, period	6 months	6 months
Fog Cutter Capital Group Inc \| SBN FCCG LLC
Loss Contingencies [Line Items]
Amount awarded to other party related to litigation							600,000
Payments for legal settlements							$ 100,000
Estimated litigation liability										$ 5,100,000
Indemnification costs														$ 12,000,000
Fog Cutter Capital Group Inc \| New York \| SBN FCCG LLC
Loss Contingencies [Line Items]
Amount awarded to other party related to litigation									$ 700,000
Litigation settlement interest									200,000
Fog Cutter Capital Group Inc \| California \| SBN FCCG LLC
Loss Contingencies [Line Items]
Amount awarded to other party related to litigation								$ 700,000	700,000
Litigation settlement interest								$ 12,411	$ 700,000

GEOGRAPHIC INFORMATION (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
GEOGRAPHIC INFORMATION (Details) - USD ($) $ in Thousands	Sep. 29, 2024	Sep. 24, 2023	Sep. 29, 2024	Sep. 24, 2023
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue	$ 143,365	$ 109,366	$ 447,372	$ 321,821
United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue	140,600	106,400	440,000	314,200
Other countries
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue	$ 2,800	$ 3,000	$ 7,400	$ 7,600

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