El Pollo Loco Holdings, Inc. 10-Q

Item 1. Financial Statements. EL POLLO LOCO HOLDINGS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Amounts in thousands, except share and per share data) ​ ​ ​ ​ ​ ​ ​ ​ ​ September 24, December 25, ​ 2025 2024 Assets ​ ​ ​ ​ ​ Current assets: ​ ​ ​ ​ Cash and cash equivalents ​ $ 10,872 ​ $ 2,484 Accounts and other receivables, net ​ 10,258 ​ 9,471 Inventories ​ 1,736 ​ 1,938 Prepaid expenses and other current assets ​ 3,348 ​ 5,509 Income tax receivable ​ 2,239 ​ 493 Total current assets ​ 28,453 ​ 19,895 Property and equipment, net ​ 88,893 ​ 86,149 Property and equipment held under finance lease, net ​ 1,356 ​ 1,499 Property and equipment held under operating leases, net ("ROU asset") ​ 169,957 ​ 170,494 Goodwill ​ 248,674 ​ 248,674 Trademarks ​ 61,888 ​ 61,888 Deferred tax assets ​ — ​ 336 Other assets ​ 3,527 ​ 3,079 Total assets ​ $ 602,748 ​ $ 592,014 Liabilities and Stockholders’ Equity ​ ​ Current liabilities: ​ ​ Current portion of obligations under finance leases ​ $ 152 ​ $ 170 Current portion of obligations under operating leases ​ 17,060 ​ 19,738 Accounts payable ​ 10,845 ​ 12,087 Accrued salaries and vacation ​ 10,803 ​ 13,926 Accrued insurance ​ 11,716 ​ 11,417 Accrued income taxes payable ​ — ​ 2,105 Accrued interest ​ 349 ​ 319 Other accrued expenses and current liabilities ​ 18,925 ​ 15,896 Total current liabilities ​ 69,850 ​ 75,658 Revolver loan ​ 61,000 ​ 71,000 Obligations under finance leases, net of current portion ​ 1,474 ​ 1,583 Obligations under operating leases, net of current portion ​ 172,655 ​ 170,529 Deferred tax liabilities, net ​ 8,745 ​ 6,357 Other noncurrent liabilities ​ 6,092 ​ 6,218 Total liabilities ​ 319,816 ​ 331,345 Commitments and contingencies (Note 8) ​ ​ Stockholders’ equity ​ ​ Preferred stock, $ 0.01 par value, 100,000,000 shares authorized; 100,000 shares designated as Series A Preferred Stock; none issued or outstanding ​ — ​ — Common stock, $ 0.01 par value, 200,000,000 shares authorized; 29,999,694 and 29,839,721 shares issued and outstanding as of September 24, 2025 and December 25, 2024, respectively ​ 299 ​ 298 Additional paid-in-capital ​ 245,619 ​ 241,462 Retained earnings ​ 37,014 ​ 18,909 Total stockholders’ equity ​ 282,932 ​ 260,669 Total liabilities and stockholders’ equity ​ $ 602,748 ​ $ 592,014 ​ See notes to condensed consolidated financial statements (unaudited). ​ 3 Table of Contents EL POLLO LOCO HOLDINGS, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) (Amounts in thousands, except share and per share data) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Thirteen Weeks Ended Thirty-Nine Weeks Ended ​ ​ September 24, 2025 ​ September 25, 2024 ​ September 24, 2025 ​ September 25, 2024 Revenue ​ ​ ​ ​ Company-operated restaurant revenue ​ $ 100,721 ​ $ 101,178 ​ $ 303,404 ​ $ 300,638 Franchise revenue ​ 12,864 ​ 11,330 ​ 39,419 ​ 34,329 Franchise advertising fee revenue ​ 7,935 ​ 7,887 ​ 23,708 ​ 23,757 Total revenue ​ 121,520 ​ 120,395 ​ 366,531 ​ 358,724 Cost of operations ​ ​ ​ ​ Food and paper cost ​ 24,879 ​ 25,401 ​ 75,114 ​ 76,751 Labor and related expenses ​ 30,648 ​ 32,744 ​ 94,982 ​ 96,192 Occupancy and other operating expenses ​ 26,730 ​ 26,088 ​ 79,144 ​ 74,609 Company restaurant expenses ​ 82,257 ​ 84,233 ​ 249,240 ​ 247,552 General and administrative expenses ​ 12,343 ​ 11,418 ​ 37,138 ​ 35,130 Franchise expenses ​ 11,407 ​ 10,488 ​ 36,476 ​ 31,961 Depreciation and amortization ​ 3,973 ​ 4,034 ​ 11,789 ​ 11,755 Loss on disposal of assets ​ 73 ​ 77 ​ 127 ​ 181 Gain on recovery of insurance proceeds, net ​ — ​ — ​ — ​ ( 41 ) Loss on disposition of restaurants ​ ​ — ​ ​ — ​ ​ — ​ ​ 7 Impairment and closed-store reserves ​ 9 ​ 8 ​ 26 ​ 45 Total expenses ​ 110,062 ​ 110,258 ​ 334,796 ​ 326,590 Income from operations ​ 11,458 ​ 10,137 ​ 31,735 ​ 32,134 Interest expense, net ​ 1,122 ​ 1,536 ​ 3,505 ​ 4,627 Income before provision for income taxes ​ 10,336 ​ 8,601 ​ 28,230 ​ 27,507 Provision for income taxes ​ 2,978 ​ 2,415 ​ 8,284 ​ 7,776 Net income ​ $ 7,358 ​ $ 6,186 ​ $ 19,946 ​ $ 19,731 Net income per share ​ ​ ​ ​ ​ ​ ​ Basic ​ $ 0.25 ​ $ 0.21 ​ $ 0.68 ​ $ 0.66 Diluted ​ $ 0.25 ​ $ 0.21 ​ $ 0.68 ​ $ 0.65 Weighted-average shares used in computing net income per share ​ ​ ​ ​ Basic ​ 29,219,480 ​ 29,199,971 ​ 29,134,766 ​ 30,072,637 Diluted ​ 29,406,754 ​ 29,423,649 ​ 29,343,906 ​ 30,235,309 ​ See notes to condensed consolidated financial statements (unaudited). ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 4 Table of Contents EL POLLO LOCO HOLDINGS, INC. CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (UNAUDITED) (Amounts in thousands, except share data) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Thirteen Weeks Ended September 24, 2025 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ Total ​ ​ Common Stock ​ Paid-in ​ Retained ​ Stockholders’ ​ Shares Amount Capital Earnings Equity Balance, June 25, 2025 ​ 30,008,692 ​ $ 299 ​ $ 244,223 ​ $ 29,656 ​ $ 274,178 Stock-based compensation ​ — ​ — ​ 1,369 ​ — ​ 1,369 Issuance of common stock related to restricted shares ​ 5,975 ​ ​ — ​ ​ — ​ ​ — ​ ​ — Issuance of common stock upon exercise of stock options, net ​ 8,737 ​ ​ 1 ​ ​ 82 ​ ​ — ​ ​ 83 Shares repurchased for employee tax withholdings ​ ( 5,263 ) ​ ​ — ​ ​ ( 55 ) ​ ​ — ​ ​ ( 55 ) Repurchase of common stock ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — Repurchase of common stock - excise tax ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — Forfeiture of common stock related to restricted shares ​ ( 18,447 ) ​ ( 1 ) ​ — ​ — ​ ( 1 ) Net income ​ — ​ — ​ — ​ 7,358 ​ 7,358 Balance, September 24, 2025 ​ 29,999,694 ​ $ 299 ​ $ 245,619 ​ $ 37,014 ​ $ 282,932 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Thirteen Weeks Ended September 25, 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ ​ Total ​ ​ Common Stock ​ Paid-in ​ Retained ​ Stockholders’ ​ Shares Amount Capital Earnings Equity Balance, June 26, 2024 ​ 29,988,771 ​ $ 299 ​ $ 220,772 ​ $ 27,507 ​ $ 248,578 Stock-based compensation ​ — ​ ​ — ​ ​ 1,080 ​ ​ — ​ ​ 1,080 Issuance of common stock related to restricted shares ​ 9,616 ​ ​ — ​ ​ — ​ ​ — ​ ​ — Issuance of common stock upon exercise of stock options, net ​ 53,316 ​ ​ 1 ​ ​ 498 ​ ​ — ​ ​ 499 Shares repurchased for employee tax withholdings ​ ( 4,731 ) ​ ​ — ​ ​ ( 64 ) ​ ​ — ​ ​ ( 64 ) Repurchase of common stock ​ ( 92,043 ) ​ ​ ( 1 ) ​ ​ ( 1,061 ) ​ ​ — ​ ​ ( 1,062 ) Repurchase of common stock - excise tax ​ — ​ ​ — ​ ​ ( 7 ) ​ ​ — ​ ​ ( 7 ) Forfeiture of common stock related to restricted shares ​ ( 4,453 ) ​ ​ — ​ ​ — ​ ​ — ​ ​ — Net income ​ — ​ ​ — ​ ​ — ​ ​ 6,186 ​ ​ 6,186 Balance, September 25, 2024 ​ 29,950,476 ​ $ 299 ​ $ 221,218 ​ $ 33,693 ​ $ 255,210 ​ 5 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Thirty-Nine Weeks Ended September 24, 2025 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ Total ​ ​ Common Stock ​ Paid-in ​ Retained ​ Stockholders’ ​ Shares Amount Capital Earnings Equity Balance, December 25, 2024 ​ 29,839,721 ​ $ 298 ​ $ 241,462 ​ $ 18,909 ​ $ 260,669 Stock-based compensation ​ — ​ — ​ 4,116 ​ — ​ 4,116 Issuance of common stock related to restricted shares ​ 404,701 ​ ​ 4 ​ ​ ( 4 ) ​ ​ — ​ ​ — Issuance of common stock upon exercise of stock options, net ​ 54,353 ​ ​ 1 ​ ​ 534 ​ ​ — ​ ​ 535 Shares repurchased for employee tax withholdings ​ ( 49,493 ) ​ ​ ( 1 ) ​ ​ ( 490 ) ​ ​ — ​ ​ ( 491 ) Repurchase of common stock ​ ( 163,229 ) ​ ​ ( 2 ) ​ ​ — ​ ​ ( 1,841 ) ​ ​ ( 1,843 ) Repurchase of common stock - excise tax ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — Forfeiture of common stock related to restricted shares ​ ( 86,359 ) ​ ​ ( 1 ) ​ ​ 1 ​ ​ — ​ ​ — Net income ​ — ​ — ​ — ​ 19,946 ​ 19,946 Balance, September 24, 2025 ​ 29,999,694 ​ $ 299 ​ $ 245,619 ​ $ 37,014 ​ $ 282,932 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Thirty-Nine Weeks Ended September 25, 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ Total ​ ​ Common Stock ​ Paid-in ​ Retained ​ Stockholders’ ​ Shares Amount Capital Earnings Equity Balance, December 27, 2023 ​ 31,353,223 ​ $ 313 ​ $ 236,421 ​ $ 13,962 ​ $ 250,696 Stock-based compensation ​ — ​ ​ — ​ ​ 2,897 ​ ​ — ​ ​ 2,897 Issuance of common stock related to restricted shares ​ 503,112 ​ ​ 5 ​ ​ ( 5 ) ​ ​ — ​ ​ — Issuance of common stock upon exercise of stock options, net ​ 163,696 ​ ​ 2 ​ ​ 1,553 ​ ​ — ​ ​ 1,555 Shares repurchased for employee tax withholdings ​ ( 19,025 ) ​ ​ — ​ ​ ( 212 ) ​ ​ — ​ ​ ( 212 ) Repurchase of common stock ​ ( 1,966,229 ) ​ ​ ( 20 ) ​ ​ ( 19,272 ) ​ ​ — ​ ​ ( 19,292 ) Repurchase of common stock - excise tax ​ — ​ ​ — ​ ​ ( 165 ) ​ ​ — ​ ​ ( 165 ) Forfeiture of common stock related to restricted shares ​ ( 84,301 ) ​ ​ ( 1 ) ​ ​ 1 ​ ​ — ​ ​ — Net income ​ — ​ ​ — ​ ​ — ​ ​ 19,731 ​ ​ 19,731 Balance, September 25, 2024 ​ 29,950,476 ​ $ 299 ​ $ 221,218 ​ $ 33,693 ​ $ 255,210 ​ See notes to condensed consolidated financial statements (unaudited). ​ ​ ​ ​ ​ ​ ​ 6 Table of Contents EL POLLO LOCO HOLDINGS, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Amounts in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Thirty-Nine Weeks Ended ​ September 24, 2025 ​ September 25, 2024 Cash flows from operating activities: ​ ​ ​ ​ Net income ​ $ 19,946 ​ $ 19,731 Adjustments to reconcile net income to net cash flows provided by operating activities: ​ ​ ​ Depreciation and amortization ​ 11,789 ​ 11,755 Stock-based compensation expense ​ 4,116 ​ 2,897 Loss on disposition of restaurants ​ ​ — ​ ​ 7 Loss on disposal of assets ​ 127 ​ 181 Gain on recovery of insurance proceeds, net ​ ​ — ​ ​ ( 41 ) Amortization of deferred financing costs ​ 144 ​ 149 Deferred income taxes, net ​ 2,724 ​ 268 Changes in operating assets and liabilities: ​ ​ ​ Accounts and other receivables ​ ( 787 ) ​ ( 460 ) Inventories ​ 202 ​ 60 Prepaid expenses and other current assets ​ 2,161 ​ 2,995 Income taxes receivable/payable ​ ( 3,851 ) ​ 103 Operating lease assets ​ ​ 14,499 ​ ​ 14,422 Other assets ​ ( 592 ) ​ ( 225 ) Accounts payable ​ ( 693 ) ​ ( 2,617 ) Accrued salaries and vacation ​ ( 3,123 ) ​ 1,470 Accrued insurance ​ 299 ​ 277 Payment related to tax receivable agreement ​ — ​ ( 399 ) Operating lease liabilities ​ ​ ( 14,502 ) ​ ​ ( 14,217 ) Other accrued expenses and liabilities ​ 1,707 ​ 4,790 Net cash flows provided by operating activities ​ 34,166 ​ 41,146 Cash flows from investing activities: ​ ​ ​ ​ ​ Proceeds from disposition of restaurants ​ — ​ 100 Proceeds from fire insurance for property and equipment ​ ​ — ​ ​ 41 Purchase of property and equipment ​ ( 13,811 ) ​ ( 14,578 ) Net cash flows used in investing activities ​ ( 13,811 ) ​ ( 14,437 ) Cash flows from financing activities: ​ ​ Proceeds from borrowings on revolver and swingline loans ​ 9,000 ​ 14,000 Payments on revolver and swingline loan ​ ( 19,000 ) ​ ( 22,000 ) Minimum tax withholdings related to net share settlements ​ ( 491 ) ​ ( 212 ) Proceeds from issuance of common stock upon exercise of stock options, net of expenses ​ ​ 535 ​ ​ 1,555 Payment of obligations under finance leases ​ ( 168 ) ​ ( 153 ) Repurchases of common stock ​ ( 1,843 ) ​ ( 19,292 ) Net cash flows used in financing activities ​ ( 11,967 ) ​ ( 26,102 ) Increase in cash and cash equivalents ​ 8,388 ​ 607 Cash and cash equivalents, beginning of period ​ 2,484 ​ 7,288 Cash and cash equivalents, end of period ​ $ 10,872 ​ $ 7,895 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Thirty-Nine Weeks Ended ​ ​ September 24, 2025 ​ September 25, 2024 Supplemental cash flow information ​ ​ Cash paid during the period for interest ​ $ 3,356 ​ $ 4,693 Cash paid during the period for income taxes ​ $ 9,924 ​ $ 6,912 Unpaid purchases of property and equipment ​ $ 4,697 ​ $ 3,252 Unpaid repurchases of common stock and excise tax ​ $ — ​ $ 721 ​ See notes to condensed consolidated financial statements (unaudited). ​ 7 Table of Contents EL POLLO LOCO HOLDINGS, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) 1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Overview El Pollo Loco Holdings, Inc. (“Holdings” or “Company”) is a Delaware corporation headquartered in Costa Mesa, California. Holdings and its direct and indirect subsidiaries are collectively referred to herein as the “Company.” The Company’s activities are conducted principally through its indirect wholly owned subsidiary, El Pollo Loco, Inc. (“EPL”), which develops, franchises, licenses, and operates quick-service restaurants under the name El Pollo Loco® and operates under one operating segment. At September 24, 2025, the Company operated 174 and franchised 324 El Pollo Loco restaurants in the United States. As of September 24, 2025, the Company licenses eight restaurants in the Philippines. This total reflects the closure of two licensed restaurants during the thirty-nine weeks ended September 24, 2025. Basis of Presentation The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial statements and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments consisting of normal recurring adjustments necessary for a fair statement of the Company’s condensed consolidated financial position and results of operations and cash flows for the periods presented. Interim results of operations are not necessarily indicative of the results that may be achieved for the full year. The condensed consolidated financial statements and related notes do not include all information and footnotes required by GAAP for annual reports. This quarterly report should be read in conjunction with the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 25, 2024. ​ The Company uses a 52- or 53-week fiscal year ending on the last Wednesday of the calendar year. In a 52-week fiscal year, each quarter includes 13 weeks of operations; in a 53-week fiscal year, the first, second and third quarters each include 13 weeks of operations, and the fourth quarter includes 14 weeks of operations. Every six or seven years, a 53-week fiscal year occurs. Fiscal 2025 is a 53-week year ending on December 31, 2025. Fiscal 2024 was a 52-week year ended on December 25, 2024. Revenues, expenses, and other financial and operational figures may be elevated in a 53-week year. ​ Certain prior year amounts in the accompanying condensed consolidated financial statements have been reclassified to conform with the current year presentation. ​ Holdings has no material assets or operations. Holdings and Holdings’ direct subsidiary, EPL Intermediate, Inc. (“Intermediate”), guarantee EPL’s 2022 Revolver (as defined in Note 5 below) on a full and unconditional basis and Intermediate has no subsidiaries other than EPL. EPL is a separate and distinct legal entity, and has no obligation to make funds available to Intermediate. EPL and Intermediate may pay dividends to Intermediate and to Holdings, respectively. ​ Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of Holdings and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the condensed consolidated financial statements and revenue and expenses during the periods reported. Actual results could materially differ from those estimates. The Company’s significant estimates include 8 Table of Contents estimates for impairment of goodwill, intangible assets and property and equipment, insurance reserves, lease accounting matters and contingent liabilities. Cash and Cash Equivalents The Company considers all liquid instruments with an original maturity of three months or less at the date of purchase to be cash equivalents. Liquidity The Company’s principal liquidity and capital requirements are new restaurants, existing restaurant capital investments (remodels and maintenance), interest payments on its debt, lease obligations and working capital and general corporate needs. At September 24, 2025, the Company’s total outstanding balance on its Revolver was $ 61.0 million. The Company’s ability to make payments on its indebtedness and to fund planned capital expenditures depends on available cash and its ability to generate adequate cash flows in the future, which, to a certain extent, is subject to general economic, financial, competitive, legislative, regulatory, and other factors that are beyond the Company’s control. Based on current operations, the Company believes that its cash flow from operations, available cash of $ 10.9 million at September 24, 2025, and the outstanding borrowing availability under the 2022 Revolver will be adequate to meet the Company’s liquidity needs for the next twelve months from the date of filing of these condensed consolidated financial statements. Subsequent Events Subsequent to the quarter-end, the Company paid down an additional $ 6.0 million on its 2022 Revolver resulting in outstanding borrowings of $ 55.0 million as of October 30, 2025. Concentration of Risk Cash and cash equivalents are maintained at financial institutions and, at times, these balances may exceed federally-insured limits. The Company has never experienced any losses related to these balances. ​ The Company had no suppliers for which amounts due totaled more than 10% of the Company’s accounts payable at September 24, 2025. The Company had one supplier to whom amounts due totaled 19.7 % of the Company’s accounts payable at December 25, 2024. Purchases from the Company’s largest supplier totaled 24.7 % and 18.9 % of total expenses for the thirteen and thirty-nine weeks ended September 24, 2025, respectively, and 24.0 % and 24.3 % of total expenses for the thirteen and thirty-nine weeks ended September 25, 2024, respectively. ​ Company-operated and franchised restaurants in the greater Los Angeles area generated, in the aggregate, approximately 72.2 % and 71.9 % of total revenue for the thirteen and thirty-nine weeks ended September 24, 2025, respectively, and 72.5 % and 71.9 % of total revenue for the thirteen and thirty-nine weeks ended September 25, 2024, respectively. ​ Goodwill and Indefinite Lived Intangible Assets The Company’s indefinite-lived intangible assets consist of trademarks. Goodwill represents the excess of cost over fair value of net identified assets acquired in business combinations accounted for under the purchase method. The Company does not amortize its goodwill and indefinite-lived intangible assets. Goodwill resulted from the acquisition of certain franchise locations. Upon the sale or refranchising of a restaurant, the Company evaluates whether there is a decrement of goodwill. The amount of goodwill included in the cost basis of the asset sold is determined based on the relative fair value of the portion of the reporting unit disposed of compared to the fair value of the reporting unit retained. The Company reports as one reporting unit. The fair value of the portion of the reporting unit disposed of in a refranchising is determined by reference to the discounted value of the future cash flows expected to be generated by the restaurant and retained by the franchisee, which includes a deduction for the anticipated, future royalties the franchisee will pay the Company associated with the franchise agreement entered into simultaneously with the refranchising transition. The fair value of the reporting unit retained is based on the price a willing buyer would pay for the reporting unit and includes the value of franchise agreements. As such, the fair value of the reporting unit retained can include expected cash flows from future 9 Table of Contents royalties from those restaurants currently being refranchised, future royalties from existing franchise businesses and company restaurant operations. The Company did no t record any decrement to goodwill related to the disposition of restaurants in fiscal 2024 or the thirty-nine weeks ended September 24, 2025. The Company performs an annual impairment test for goodwill during the fourth fiscal quarter of each year, or more frequently if impairment indicators arise. The Company reviews goodwill for impairment utilizing either a qualitative assessment or a fair value test by comparing the fair value of a reporting unit with its carrying amount. If the Company decides that it is appropriate to perform a qualitative assessment and concludes that the fair value of a reporting unit more likely than not exceeds its carrying value, no further evaluation is necessary. If the Company performs the fair value test, the Company will compare the fair value of a reporting unit with its carrying amount, including goodwill. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired. If the carrying amount of a reporting unit exceeds its fair value, the Company will recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized cannot exceed the total amount of goodwill allocated to that reporting unit. The Company performs an annual impairment test for indefinite-lived intangible assets during the fourth fiscal quarter of each year, or more frequently if impairment indicators arise. An impairment test consists of either a qualitative assessment or a comparison of the fair value of an intangible asset with its carrying amount. The excess of the carrying amount of an intangible asset over its fair value is recognized as an impairment loss. The assumptions used in the estimate of fair value are generally consistent with the past performance of the Company’s reporting segment and are also consistent with the projections and assumptions that are used in current operating plans. These assumptions are subject to change as a result of changing economic and competitive conditions. The Company determined that there were no indicators of potential impairment of its goodwill and indefinite-lived intangible assets during the thirteen and thirty-nine weeks ended September 24, 2025. Accordingly, the Company did no t record any impairment to its goodwill or indefinite-lived intangible assets during the thirteen and thirty-nine weeks ended September 24, 2025. Fair Value Measurements Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets and liabilities carried at fair value are classified and disclosed in one of the following three categories: ● Level 1: Quoted prices for identical instruments in active markets. ● Level 2: Observable prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs or significant value drivers are observable. ● Level 3: Unobservable inputs used when little or no market data is available. Certain assets and liabilities are measured at fair value on a nonrecurring basis. In other words, the instruments are not measured at fair value on an ongoing basis, but are subject to fair value adjustments only in certain circumstances (e.g., when there is evidence of impairment). There were no non-financial instruments measured at fair value on a nonrecurring basis as of and for the thirteen and thirty-nine weeks ended September 24, 2025 and September 25, 2024. Impairment of Property and Equipment and ROU Assets The Company reviews its property and equipment and right-of-use assets (“ROU assets”) for impairment on a restaurant-by-restaurant basis whenever events or changes in circumstances indicate that the carrying value of certain property and equipment and ROU assets may not be recoverable. The Company considers a triggering event, related to 10 Table of Contents property and equipment assets or ROU assets in a net asset position to have occurred related to a specific restaurant if the restaurant’s average unit volume (“AUV”) for the last twelve months are less than a minimum threshold or if consistent levels of undiscounted cash flows for the remaining lease period are less than the carrying value of the restaurant’s assets. Additionally, the Company considers a triggering event related to ROU assets to have occurred related to a specific lease if the location has been closed or subleased and future estimated sublease income is less than current lease payments. If the Company concludes that the carrying value of certain property and equipment and ROU assets will not be recovered based on expected undiscounted future cash flows, an impairment loss is recorded to reduce the property and equipment or ROU assets to their estimated fair value. The fair value is measured on a nonrecurring basis using unobservable (Level 3) inputs. There is uncertainty in the projected undiscounted future cash flows used in the Company’s impairment review analysis, which requires the use of estimates and assumptions. If actual performance does not achieve the projections, or if the assumptions used change in the future, the Company may be required to recognize impairment charges in future periods, and such charges could be material. The Company determined that triggering events occurred for certain stores during the thirty-nine weeks ended September 24, 2025 that required an impairment review of certain of the Company’s property and equipment and ROU assets. Based on the results of this analysis, the Company did no t record any non-cash impairment charges for the thirteen and thirty-nine weeks ended September 24, 2025 and September 25, 2024. Closed-Store Reserves When a restaurant is closed, the Company will evaluate the ROU asset for impairment, based on anticipated sublease recoveries. The remaining value of the ROU asset is amortized on a straight-line basis, with the expense recognized in closed-store reserve expense. Additionally, any property tax and common area maintenance (“CAM”) payments relating to closed restaurants are included within closed-store expense. During both the thirteen and thirty-nine weeks ended September 24, 2025 and September 25, 2024, the Company recognized less than $ 0.1 million of closed-store reserve expense related to the amortization of ROU assets, property taxes and CAM payments for its closed location. Gain on Recovery of Insurance Proceeds and Lost Profits During the thirty-nine weeks ended September 25, 2024, the Company recognized gains of less than $ 0.1 million related to the reimbursement of property and equipment and expenses. The gain on recovery of insurance proceeds and lost profits, net of the related costs, is included in the accompanying condensed consolidated statements of income, for the thirty-nine weeks ended September 25, 2024, as a reduction of company restaurant expenses. Loss on Disposition of Restaurants During the thirty-nine weeks ended September 25, 2024, the Company completed the sale of one restaurant within California to an existing franchisee due to an expiring lease term on April 30, 2024. This sale resulted in cash proceeds of $ 0.1 million and a net loss on sale of restaurant of less than $ 0.1 million during the thirty-nine weeks ended September 25, 2024. Income Taxes The provision for income taxes, income taxes payable and deferred income taxes is determined using the asset and liability method. Deferred tax assets and liabilities are determined based on temporary differences between the financial carrying amounts and the tax bases of assets and liabilities using enacted tax rates in effect in the years in which the temporary differences are expected to reverse. On a periodic basis, the Company assesses the probability that its net deferred tax assets, if any, will be recovered. If, after evaluating all of the positive and negative evidence, a conclusion is made that it is more likely than not that some portion or all of the net deferred tax assets will not be recovered, a valuation allowance is provided by charging to tax expense a reserve for the portion of deferred tax assets which are not expected to be realized. The Company reviews its filing positions for all open tax years in all U.S. federal and state jurisdictions where the Company is required to file. When there are uncertainties related to potential income tax benefits, in order to qualify for recognition, the position the Company takes has to have at least a “more likely than not” chance of being sustained (based on the position’s technical merits) upon challenge by the respective authorities. The term “more likely than not” means a likelihood of more than 11 Table of Contents 50 percent. Otherwise, the Company may not recognize any of the potential tax benefit associated with the position. The Company recognizes a benefit for a tax position that meets the “more likely than not” criterion at the largest amount of tax benefit that is greater than 50 percent likely of being realized upon its effective resolution. Unrecognized tax benefits involve management’s judgment regarding the likelihood of the benefit being sustained. The final resolution of uncertain tax positions could result in adjustments to recorded amounts and may affect the Company’s condensed consolidated financial position, results of operations, and cash flows. The Company’s policy is to recognize interest and penalties related to income tax matters in income tax expense. The Company had no accrual for interest or penalties at September 24, 2025 or at December 25, 2024. The Company did no t recognize interest or penalties during the thirteen and thirty-nine weeks ended September 24, 2025 and September 25, 2024, since there were no material unrecognized tax benefits. Management believes no significant changes to the amount of unrecognized tax benefits will occur within the next twelve months. For the thirteen weeks ended September 24, 2025, the Company recorded an income tax provision of $ 3.0 million, reflecting an estimated effective tax rate of 28.8 %. For the thirteen weeks ended September 25, 2024, the Company recorded an income tax provision of $ 2.4 million, reflecting an estimated effective tax rate of approximately 28.1 %. For the thirty-nine weeks ended September 24, 2025, the Company recorded an income tax provision of $ 8.3 million, reflecting an estimated effective tax rate of approximately 29.3 %. For the thirty-nine weeks ended September 25, 2024, the Company recorded an income tax provision of $ 7.8 million, reflecting an estimated effective tax rate of approximately 28.3 %. The difference between the 21.0 % statutory rate and the effective tax rate of 29.3 % for the thirty-nine weeks ended September 24, 2025 is primarily a result of state taxes, the impact of non-tax deductible executive compensation, and the impact of lower stock compensation expense related to vesting of restricted stock awards deductible for tax as compared to the cumulative amount recorded as stock-based compensation expense, partially offset by a federal Work Opportunity Tax Credit benefit . Recently Issued Accounting Pronouncements In December 2023, the Financial Accounting Standard Board (“FASB”) issued ASU No. 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures” (“ASU 2023-09”). ASU 2023-09 includes amendments requiring enhanced income tax disclosures, primarily related to standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction. The guidance is effective for fiscal years beginning after December 15, 2024, with early adoption permitted, and should be applied prospectively with the option of retrospective application. The Company is currently evaluating the impact of adopting ASU 2023-09 on its disclosures. In November 2024, the FASB issued ASU No. 2024-03, “Income Statement Reporting Comprehensive Income/Expense Disaggregation Disclosures” (“ASU 2024-03”). ASU 2024-03 requires disaggregated disclosure of income statement expenses at interim and annual reporting periods. In January 2025, the FASB issued ASU No. 2025-01, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures: Clarifying the Effective Date”, which clarifies that the ASU 2024-03 is effective for fiscal year beginning after December 15, 2026, and interim periods beginning after December 15, 2027, with early adoption permitted. ASU 2024-03 can be adopted prospectively or retrospectively at the option of the Company. The Company is currently evaluating the impact of adopting ASU 2024-03 on its disclosures. The Company reviewed all other recently issued accounting pronouncements and concluded that they were either not applicable or not expected to have a significant impact to the condensed consolidated financial statements. 2. PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets consist of the following (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ September 24, 2025 December 25, 2024 Prepaid insurance ​ $ 493 ​ $ 2,574 Prepaid service fees ​ 1,803 ​ 2,255 Other current assets ​ ​ 1,052 ​ ​ 680 Total prepaid expenses and other current assets ​ $ 3,348 ​ $ 5,509 ​ ​ 12 Table of Contents 3. PROPERTY AND EQUIPMENT The costs and related accumulated depreciation and amortization of major classes of property and equipment are as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ September 24, 2025 December 25, 2024 Land ​ $ 12,323 ​ $ 12,323 Buildings and improvements ​ 154,518 ​ 152,410 Other property and equipment ​ 94,586 ​ 91,352 Construction in progress ​ 15,726 ​ 9,882 ​ ​ 277,153 ​ 265,967 Less: accumulated depreciation and amortization ​ ( 188,260 ) ​ ( 179,818 ) Total property and equipment, net ​ $ 88,893 ​ $ 86,149 ​ Depreciation and amortization expense was $ 4.0 million for both the thirteen weeks ended September 24, 2025 and September 25, 2024, and $ 11.8 million for both the thirty-nine weeks ended September 24, 2025 and September 25, 2024. Based on the Company’s review of its property and equipment assets for impairment, the Company did no t record any non-cash impairment charges for the thirteen and thirty-nine weeks ended September 24, 2025 and September 25, 2024. See Note 1, “Basis of Presentation and Summary of Significant Accounting Policies – Impairment of Property and Equipment and ROU Assets” for additional information. 4. STOCK-BASED COMPENSATION Pursuant to the Company’s 2018 Omnibus Equity Incentive Plan (as amended, the “Incentive Plan”), the Company grants stock options (“options”), restricted stock units, performance-based restricted stock units (“PSUs”) and restricted stock to the Company’s employees, officers, directors, and other eligible participants. On May 29, 2025, the Company’s stockholders approved an amendment to the Incentive Plan, under which the new aggregate share limit was increased by 1,250,000 shares for a total of 4,500,000 shares. As of September 24, 2025, 1,425,040 shares of common stock remained available for issuance under the Incentive Plan. Total stock-based compensation expense was $ 1.4 million and $ 4.1 million for the thirteen and thirty-nine weeks ended September 24, 2025, and $ 1.1 million and $ 2.9 million for the thirteen and thirty-nine weeks ended September 25, 2024. Stock Options At September 24, 2025, options to purchase 1,414,613 shares of common stock were outstanding, including 461,847 vested and 952,766 unvested options. Unvested options vest over time; however, pursuant to the Incentive Plan, upon a change in control, the Company’s Board of Directors (the “Board”) may accelerate vesting. A summary of stock option activity at September 24, 2025 and changes during the thirty-nine weeks ended September 24, 2025 is as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-Average Aggregate ​ ​ Weighted-Average Contractual Life Intrinsic Value ​ ​ Shares ​ Exercise Price Life (Years) (in thousands) Outstanding – December 25, 2024 1,098,320 ​ $ 10.36 ​ ​ ​ ​ ​ ​ Grants 512,445 ​ 10.44 ​ ​ ​ ​ ​ ​ Exercised ( 54,353 ) ​ ​ 9.85 ​ ​ ​ ​ ​ ​ Forfeited, cancelled or expired ( 141,799 ) ​ ​ 10.10 ​ ​ ​ ​ ​ ​ Outstanding – September 24, 2025 1,414,613 ​ $ 10.43 ​ ​ 7.71 ​ $ 286 Vested and expected to vest at September 24, 2025 1,400,218 ​ $ 10.43 ​ ​ 7.70 ​ $ 285 Exercisable at September 24, 2025 461,847 ​ $ 10.66 ​ ​ 5.10 ​ $ 174 ​ The fair value of each stock option was estimated on the grant date using an exercise price of the closing stock price on the day prior to date of grant and the Black-Scholes option-pricing model with the following weighted average assumptions: 13 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ September 24, 2025 September 25, 2024 Expected volatility ​ 42.8 % 44.1 % Risk-free interest rate 4.1 % 4.6 % Expected term (years) 6.00 6.25 ​ Expected dividends — — ​ ​ At September 24, 2025, the Company had total unrecognized compensation expense of $ 4.0 million related to unvested stock options, which it expects to recognize over a weighted-average period of 2.51 years. ​ Restricted Shares ​ A summary of restricted share activity as of September 24, 2025 and changes during the thirty-nine weeks ended September 24, 2025 is as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-Average ​ ​ Shares ​ Fair Value Unvested shares at December 25, 2024 708,377 ​ $ 10.16 Granted 404,701 ​ $ 10.42 Released ( 258,529 ) ​ $ 10.37 Forfeited and cancelled ( 86,359 ) ​ $ 10.18 Unvested shares at September 24, 2025 768,190 ​ $ 10.26 ​ Unvested shares at September 24, 2025, included 737,936 unvested restricted shares and 30,254 performance-based restricted stock units that have been earned based on performance targets but still unvested. At September 24, 2025, the Company had unrecognized compensation expense of $ 6.0 million related to unvested restricted shares, which it expects to recognize over a weighted-average period of 2.29 years. Performance-Based Restricted Stock Units During the thirty-nine weeks ended September 24, 2025, the Company granted 159,948 restricted stock units under the Incentive Plan subject to performance-based vesting conditions based on revenue and restaurant contribution margin to certain officers. PSUs have a grant date fair value of $ 10.42 and a vesting period from the grant date through the date the audit of the Company's fiscal 2027 financial results is expected to be completed. During the thirty-nine weeks ended September 24, 2025, 11,996 PSUs were forfeited. The fair value of PSUs are expensed based on management's current estimate of the level that the performance goal will be achieved. As of September 24, 2025, based on the target level of performance, the total unrecognized compensation expense related to unvested PSUs was $ 1.4 million, which is expected to be recognized over a weighted-average period of 2.45 years. Total stock-based compensation expense was $ 1.4 million and $ 4.1 million for the thirteen and thirty-nine weeks ended September 24, 2025, and $ 1.1 million and $ 2.9 million for the thirteen and thirty-nine weeks ended September 25, 2024. Share Repurchases Share Repurchase Program On November 2, 2023, the Company announced that the Board approved a share repurchase program (“Share Repurchase Program”) under which the Company was authorized to repurchase up to $ 20,000,000 of shares of the Company’s common stock. Under the Share Repurchase Program, the Company was permitted to repurchase its common stock from time to time, in amounts and at prices that the Company deemed appropriate, subject to market conditions and other considerations. Pursuant to the Share Repurchase Program, the Company was authorized to effect repurchases using open market purchases, including pursuant to Rule 10b5-1 trading plans, and/or through privately negotiated transactions. The Share Repurchase Program did not obligate the Company to acquire any particular number of shares. The Share Repurchase Program expired on March 31, 2025. The Company did no t repurchase any shares of its common stock during the thirteen weeks ended September 24, 2025. For the thirty-nine weeks ended September 24, 2025, the Company repurchased 163,229 shares of common stock under the Share Repurchase Program, using open market purchases, for total consideration of $ 1.8 million. 14 Table of Contents For the thirteen and thirty-nine weeks ended September 25, 2024, the Company repurchased 92,043 and 431,926 shares of common stock, respectively, under the Share Repurchase Program, using open market purchases, for total consideration of approximately $ 1.1 million and $ 4.3 million, respectively. Other Share Repurchases During the thirty-nine week period ended September 25, 2024, the Company repurchased 1,534,303 shares for a total purchase price of $ 15.0 million under the Stock Repurchase Agreement with FS Equity Partners V, L.P. and FS Affiliates V, L.P. 5. LONG-TERM DEBT On July 27, 2022, the Company entered into a credit agreement (the “2022 Credit Agreement”) among EPL, as borrower, the Company and Intermediate, as guarantors, Bank of America, N.A., as administrative agent, swingline lender, and letter of credit issuer, the lenders party thereto, and the other parties thereto, to refinance its $ 150.0 million five-year senior secured revolving credit facility (the “2022 Revolver”). The 2022 Revolver includes a sub limit of $ 15.0 million for letters of credit and a sub limit of $ 15.0 million for swingline loans. The obligations under the 2022 Credit Agreement and related loan documents are guaranteed by Holdings and Intermediate. The obligations of Holdings, EPL and Intermediate under the 2022 Credit Agreement and related loan documents are secured by a first priority lien on substantially all of their respective assets subject to certain customary exceptions. Under the 2022 Revolver, Holdings is restricted from making certain payments such as cash dividends, except that it may, inter alia, (i) pay up to $ 1.0 million per year to repurchase or redeem qualified equity interests of Holdings held by past or present officers, directors, or employees (or their estates) of the Company upon death, disability, or termination of employment, and (ii) so long as no default or event of default has occurred and is continuing, (a) make non-cash repurchases of equity interests in connection with the exercise of stock options by directors, officers and management, provided that those equity interests represent a portion of the consideration of the exercise price of those stock options, (b) pay up to $ 0.5 million in any 12-month consecutive period to redeem, repurchase or otherwise acquire equity interests of any subsidiary that is not a wholly-owned subsidiary from any holder of equity interest in such subsidiary, (c) pay up to $ 2.5 million per year pursuant to stock option plans, employment agreements, or incentive plans, (d) make up to $ 5.0 million in other restricted payments per year, and (e) make other restricted payments, subject to its compliance, on a pro forma basis, with (x) a lease-adjusted consolidated leverage ratio not to exceed 4.25 times and (y) the financial covenants applicable to the 2022 Revolver. Borrowings under the 2022 Credit Agreement (other than any swingline loans) bear interest, at the borrower’s option, at rates based upon either the secured overnight financing rate (“SOFR”) or a base rate, plus, for each rate, a margin determined in accordance with a lease-adjusted consolidated leverage ratio-based pricing grid. The base rate is calculated as the highest of (a) the federal funds rate plus 0.50 %, (b) the published Bank of America prime rate, or (c) Term SOFR with a term of one-month SOFR plus 1.00 %. For Term SOFR loans, the margin is in the range of 1.25 % to 2.25 %, and for base rate loans the margin is in a range of 0.25 % to 1.25 %. Borrowings under the 2022 Revolver may be repaid and reborrowed. The interest rate range under the 2022 Revolver was 5.63 % to 5.96 % and 5.63 % to 7.75 % for the thirteen and thirty-nine weeks ended September 24, 2025, respectively, and 6.52 % to 6.95 % and 6.52 % to 6.96 % for the thirteen and thirty-nine weeks ended September 25, 2024 , respectively. The 2022 Credit Agreement contains certain customary financial covenants, subject to certain exceptions. The Company was in compliance with the financial covenants as of September 24, 2025. At September 24, 2025, the Company had $ 61.0 million in outstanding borrowings under the 2022 Revolver and two letters of credit in the amount of $ 10.3 million outstanding, and as a result, the Company had $ 78.7 million in borrowing availability. Maturities During the thirteen and thirty-nine weeks ended September 24, 2025, the Company borrowed $ 1.0 million and $ 9.0 million, respectively, and paid down $ 9.0 million and $ 19.0 million, respectively, on the 2022 Revolver. During the 15 Table of Contents thirteen and thirty-nine weeks ended September 25, 2024, the Company paid down $ 11.0 million and $ 22.0 million, respectively, on the 2022 Revolver. During the thirty-nine weeks ended September 25, 2024, the Company borrowed $ 14.0 million on the 2022 Revolver. There are no required principal payments prior to maturity of the 2022 Revolver on July 27, 2027. 6. OTHER ACCRUED EXPENSES AND CURRENT LIABILITIES Other accrued expenses and current liabilities consist of the following (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ September 24, 2025 December 25, 2024 Accrued sales and property taxes ​ $ 6,381 ​ $ 5,349 Gift card liability ​ 4,821 ​ 5,100 Loyalty rewards program liability ​ ​ 1,064 ​ ​ 844 Accrued advertising ​ ​ 1,116 ​ ​ 1,194 Accrued legal settlements and professional fees ​ 1,902 ​ 463 Deferred franchise and development fees ​ 544 ​ 539 Other ​ 3,097 ​ 2,407 Total other accrued expenses and current liabilities ​ $ 18,925 ​ $ 15,896 ​ ​ 7. OTHER NONCURRENT LIABILITIES Other noncurrent liabilities consist of the following (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ September 24, 2025 December 25, 2024 Deferred franchise and development fees ​ $ 6,063 ​ $ 6,191 Other ​ 29 ​ 27 Total other noncurrent liabilities ​ $ 6,092 ​ $ 6,218 ​ ​ 8. COMMITMENTS AND CONTINGENCIES Legal Matters From time to time, the Company is involved in various claims such as wage and hour and other legal actions that arise in the ordinary course of business. The outcomes of these actions are not predictable but the Company does not believe that the ultimate resolution of these other actions will have a material adverse effect on its financial position, results of operations, liquidity, or capital resources. A significant increase in the number of claims, or an increase in amounts owing under successful claims, could materially and adversely affect its business, condensed consolidated financial condition, results of operations, and cash flows. Purchase Commitments The Company has long-term beverage supply agreements with certain major beverage vendors. Pursuant to the terms of these arrangements, marketing rebates are provided to the Company and its franchisees from the beverage vendors based upon the dollar volume of purchases for system-wide restaurants which will vary according to their demand for beverage syrup and fluctuations in the market rates for beverage syrup. These contracts have terms extending through the end of 2032. At September 24, 2025, the Company’s total estimated commitment to purchase chicken was $ 2.1 million. Contingent Lease Obligations As a result of assigning the Company’s interest in obligations under real estate leases in connection with the sale of company-operated restaurants to some of the Company’s franchisees, the Company is contingently liable on three lease agreements. These leases have various terms, the latest of which expires in 2038 . As of September 24, 2025, the potential amount of undiscounted payments the Company could be required to make in the event of non-payment by the primary lessee was $ 3.7 million. The present value of these potential payments discounted at the Company’s estimated 16 Table of Contents pre-tax cost of debt at September 24, 2025 was $ 2.5 million. The Company’s franchisees are primarily liable on the leases. The Company has cross-default provisions with these franchisees that would put them in default of their franchise agreements in the event of non-payment under the leases. The Company believes that these cross-default provisions reduce the risk that payments will be required to be made under these leases. Employment Agreements As of September 24, 2025, the Company had employment agreements with three of the officers of the Company. These agreements provide for minimum salary levels, possible annual adjustments for cost-of-living changes, and incentive bonuses that are payable under certain business conditions. Indemnification Agreements The Company has entered into indemnification agreements with each of its current directors and officers. These agreements require the Company to indemnify these individuals to the fullest extent permitted under Delaware law against liabilities that may arise by reason of their service to the Company and to advance expenses incurred as a result of any proceeding against them as to which they could be indemnified. The Company also intends to enter into indemnification agreements with future directors and officers. ​ 9. EARNINGS PER SHARE Basic earnings per share (“EPS”) is calculated using the weighted-average number of shares of common stock outstanding during the thirteen and thirty-nine weeks ended September 24, 2025 and September 25, 2024. Diluted EPS is calculated using the weighted-average number of shares of common stock outstanding and potentially dilutive during the period, using the treasury stock method. Below are basic and diluted EPS data for the periods indicated (in thousands except for share and per share data): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Thirteen Weeks Ended ​ Thirty-Nine Weeks Ended ​ September 24, 2025 September 25, 2024 ​ September 24, 2025 September 25, 2024 Numerator: ​ ​ ​ ​ ​ Net income ​ $ 7,358 ​ $ 6,186 ​ $ 19,946 ​ $ 19,731 Denominator: ​ ​ ​ ​ Weighted-average shares outstanding—basic ​ 29,219,480 ​ 29,199,971 ​ 29,134,766 ​ 30,072,637 Weighted-average shares outstanding—diluted ​ 29,406,754 ​ 29,423,649 ​ 29,343,906 ​ 30,235,309 Net income per share—basic ​ $ 0.25 ​ $ 0.21 ​ $ 0.68 ​ $ 0.66 Net income per share—diluted ​ $ 0.25 ​ $ 0.21 ​ $ 0.68 ​ $ 0.65 Anti-dilutive securities not considered in diluted EPS calculation ​ 1,000,650 ​ 621,558 ​ 1,031,087 ​ 692,075 ​ Below is a reconciliation of basic and diluted share counts: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Thirteen Weeks Ended Thirty-Nine Weeks Ended ​ ​ September 24, 2025 September 25, 2024 ​ September 24, 2025 ​ September 25, 2024 Weighted-average shares outstanding—basic 29,219,480 29,199,971 29,134,766 30,072,637 Dilutive effect of stock options and restricted shares 187,274 ​ 223,678 209,140 162,672 Weighted-average shares outstanding—diluted 29,406,754 ​ 29,423,649 29,343,906 30,235,309 ​ ​ 10. RELATED PARTY TRANSACTIONS None. 17 Table of Contents 11. REVENUE FROM CONTRACTS WITH CUSTOMERS Revenue Recognition Nature of products and services The Company has two revenue streams, company-operated restaurant revenue and franchise-related revenue. Company-operated restaurant revenue Revenues from the operation of company-operated restaurants are recognized as food and beverage products are delivered to customers and payment is tendered at the time of sale. The Company presents revenue, net of sales-related taxes and promotional allowances. The Company offers a loyalty rewards program, which awards a customer points for dollars spent. Customers earn points for each dollar spent and points can be redeemed for multiple redemption options. If a customer does not earn or use points within a one-year period, their account is deactivated and all points expire. When a customer is part of the rewards program, the obligation to provide future discounts related to points earned is considered a separate performance obligation, to which a portion of the transaction price is allocated and recorded as deferred revenue on the balance sheet. The performance obligation related to loyalty points is deemed to have been satisfied, and the amount deferred in the balance sheet is recognized as revenue, when the points are transferred to a reward and redeemed, the reward or points have expired, or the likelihood of redemption is remote. A portion of the transaction price is then allocated to loyalty points, if necessary, on a pro-rata basis, based on stand-alone selling price, as determined by menu pricing and loyalty points terms. As of September 24, 2025 and December 25, 2024, the revenue allocated to loyalty points that have not been redeemed was $ 1.1 million and $ 0.8 million, respectively, which is reflected in the Company’s accompanying condensed consolidated balance sheets within other accrued expenses and current liabilities. Changes in the loyalty rewards program liability included in deferred revenue within other accrued expenses and current liabilities on the condensed consolidated balance sheets were as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ September 24, 2025 September 25, 2024 Loyalty rewards liability, beginning balance ​ $ 844 ​ $ 687 Revenue deferred ​ 1,920 ​ 1,620 Revenue recognized ​ ( 1,700 ) ​ ( 1,506 ) Loyalty rewards liability, ending balance ​ $ 1,064 ​ $ 801 ​ The Company expects all loyalty points revenue related to performance obligations that were unsatisfied as of September 24, 2025 to be recognized within one year . The Company sells gift cards to its customers in the restaurants and through selected third parties. The gift cards sold to customers have no stated expiration dates and are subject to actual and/or potential escheatment rights in several of the jurisdictions in which the Company operates. Furthermore, due to these escheatment rights, the Company does not recognize breakage related to the sale of gift cards due to the immateriality of the amount remaining after escheatment. The Company recognizes income from gift cards when redeemed by the customer. Unredeemed gift card balances are deferred and recorded as other accrued expenses on the accompanying condensed consolidated balance sheets. The gift card liability included in other accrued expenses and current liabilities on the condensed consolidated balance sheets was as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ September 24, 2025 ​ December 25, 2024 Gift card liability ​ $ 4,821 ​ $ 5,100 Revenue recognized from the redemption of gift cards that was included in other accrued expenses and current liabilities at the beginning of the year was as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Thirteen Weeks Ended ​ Thirty-Nine Weeks Ended 18 Table of Contents ​ September 24, 2025 ​ September 25, 2024 September 24, 2025 ​ September 25, 2024 Revenue recognized from gift card liability balance at the beginning of the year $ 205 ​ $ 214 ​ $ 848 ​ $ 833 ​ Franchise and franchise advertising fee revenue Franchise revenue consists of franchise royalties, initial franchise fees, license fees due from franchisees, IT support services, and rental income for subleases to franchisees. Franchise advertising fee revenue consists of advertising contributions received from franchisees. These revenue streams are made up of the following performance obligations: ● Franchise license - inclusive of advertising services, development agreements, training, access to restaurant development plans and help desk services; ● Discounted renewal option; and ● Hardware services. The Company satisfies the performance obligation related to the franchise license over the term of the franchise agreement, which is typically 20 years . Payment for the franchise license consists of three components, a fixed-fee related to the franchise/development agreement, a revenue-based royalty fee and a revenue-based advertising fee. The fixed fee, as determined by the signed development and/or franchise agreement, is due at the time the development agreement is entered into, and/or when the franchise agreement is signed, and does not include a finance component. The revenue-based royalty fee and revenue-based advertising fee are considered variable consideration and are recognized as franchise revenue as such revenue are earned by the franchisees. Both revenue-based fees qualify under the royalty constraint exception, and do not require an estimate of future transaction price. Additionally, the Company is utilizing the practical expedient available under ASC Topic 606, “Revenue from Contracts with Customers” (“Topic 606”) regarding disclosure of the aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied for revenue-based royalties. In certain franchise agreements, the Company offers a discounted renewal to incentivize future renewals after the end of the initial franchise term. As this is considered a separate performance obligation, the Company allocated a portion of the initial franchise fee to this discounted renewal, on a pro-rata basis, assuming a 20-year renewal. This performance obligation is satisfied over the renewal term, which is typically 10 or 20 years , while payment is fixed and due at the time the renewal is signed. The Company purchases hardware, such as scanners, printers, point-of-sale systems, kiosks, and tablets, from third party vendors, which it then sells to franchisees. As the Company is considered the principal in this relationship, payment received for the hardware is considered revenue, and is received upon transfer of the goods from the Company to the franchisee. As of September 24, 2025, there were no performance obligations related to hardware services that were unsatisfied or partially satisfied. The following table presents the Company-operated revenue disaggregated by geographic market: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Thirteen Weeks Ended ​ Thirty-Nine Weeks Ended ​ September 24, 2025 September 25, 2024 ​ September 24, 2025 September 25, 2024 Greater Los Angeles area market 72.2 % ​ 72.5 % ​ 71.9 % ​ 71.9 % Other markets 27.8 % ​ 27.5 % ​ 28.1 % ​ 28.1 % Total 100 % ​ 100 % ​ 100 % ​ 100 % ​ Contract balances The Company’s franchise contract liability includes development fees, initial franchise and license fees, franchise renewal fees, lease subsidies and royalty discounts and is included within other accrued expenses and current liabilities and other noncurrent liabilities within the accompanying condensed consolidated balance sheets. The Company receives area development fees from franchisees when they execute multi-unit area development agreements. Initial franchise and license fees, or franchise renewal fees, are received from franchisees upon the execution of, or renewal of, a franchise 19 Table of Contents agreement. Revenue is recognized from these agreements as the underlying performance obligation is satisfied, which is over the term of the agreement. ​ The following table provides information about the change in the franchise contract liability balances during the thirty-nine weeks ended September 24, 2025 and September 25, 2024 (in thousands): ​ ​ ​ ​ ​ December 25, 2024 ​ $ 6,730 Additional contract liability ​ 397 Revenue recognized ​ ( 520 ) September 24, 2025 ​ $ 6,607 ​ ​ ​ ​ December 27, 2023 ​ $ 6,997 Additional contract liability ​ ( 477 ) Revenue recognized ​ 226 September 25, 2024 ​ $ 6,746 ​ The following table illustrates the estimated revenue to be recognized in future periods related to performance obligations under the applicable contracts that are unsatisfied as of September 24, 2025 (in thousands): ​ ​ ​ ​ ​ Franchise revenues: ​ 2025 ​ $ 143 2026 ​ 548 2027 ​ 538 2028 ​ 512 2029 ​ 486 Thereafter ​ 4,380 Total ​ $ 6,607 ​ Contract Costs The Company does not currently incur costs to obtain or fulfill a contract that would be considered contract assets under Topic 606. ​ 12. LEASES Nature of Leases The Company’s operations utilize property, facilities, equipment and vehicles leased from others. Additionally, the Company has various contracts with vendors that have been determined to contain an embedded lease in accordance with Topic 842. As of September 24, 2025, the Company had one lease that it had entered into, but had not yet commenced. Significant Assumptions and Judgments In applying the requirements of Topic 842, the Company made significant assumptions and judgments related to determination of whether a contract contains a lease and the discount rate used for the lease. In determining if any of the Company’s contracts contain a lease, the Company made assumptions and judgments related to its ability to direct the use of any assets stated in the contract and the likelihood of renewing any short-term contracts for a period extending past twelve months. The Company also made significant assumptions and judgments in determining an appropriate discount rate for property leases. These included using a consistent discount rate for a portfolio of leases entered into at varying dates, using the 20 Table of Contents full 20-year term of the lease, excluding any options, and using the total minimum lease payments. The Company utilizes a third-party valuation firm in determining the discount rate, based on the above assumptions. For all other leases, the Company uses the discount rate implicit in the lease, or the Company’s incremental borrowing rate. As the Company has adopted the practical expedient not to separate lease and non-lease components, no significant assumptions or judgments were necessary in allocating consideration between these components, for all classes of underlying assets. Building and Facility Leases The majority of the Company’s building and facilities leases are classified as operating leases; however, the Company currently has one facility and 24 equipment leases that are classified as finance leases. Restaurants are operated under lease arrangements that generally provide for a fixed base rent and, in some instances, contingent rent based on a percentage of gross operating profit or net revenues in excess of a defined amount. Additionally, a number of the Company’s leases have payments that increase at pre-determined dates based on the change in the consumer price index. For all leases, the Company also reimburses the landlord for non-lease components, or items that are not considered components of a contract, such as CAM, property tax and insurance costs. While the Company determined not to separate lease and non-lease components, these payments are based on actual costs, making them variable consideration and excluding them from the calculations of the ROU asset and lease liability. The initial terms of land and restaurant building leases are generally 20 years , exclusive of options to renew. These leases typically have four 5-year renewal options , which have generally been excluded in the calculation of the ROU asset and lease liability, as they are not considered reasonably certain to be exercised, unless there have been significant leasehold improvements that have a useful life that extend past the original lease term. Furthermore, there are no residual value guarantees and no restrictions imposed by the lease. During the thirteen and thirty-nine weeks ended September 24, 2025, the Company reassessed the lease terms on 10 and 19 restaurants, respectively, due to certain triggering events, such as the addition of significant leasehold improvements with useful lives that extend past the current lease expiration, the decision to terminate a lease, or the decision to renew or exercise an option. This reassessment resulted in an additional $ 6.9 million and $ 14.0 million of ROU asset and lease liabilities for the thirteen and thirty-nine weeks ended September 24, 2025, respectively, which were recognized and will be amortized over the new lease term. During the thirteen and thirty-nine weeks ended September 25, 2024, the Company reassessed the lease terms on seven and 19 restaurants, respectively, due to certain triggering events, such as the addition of significant leasehold improvements with useful lives that extend past the current lease expiration, the decision to terminate a lease, or the decision to renew or exercise an option. This reassessment resulted in an additional $ 4.6 million and $ 12.7 million of ROU asset and lease liabilities for the thirteen and thirty-nine weeks ended September 25, 2024, respectively, which were recognized and will be amortized over the new lease term. Additionally, as the Company adopted all practical expedients available under Topic 842, no reallocation between lease and non-lease components was necessary. The Company also subleases facilities to certain franchisees and other non-related parties which are also considered operating leases. Sublease income also includes contingent rental income based on net revenues. The vast majority of these leases have rights to extend terms via fixed rental increases. However, none of these leases have early termination rights, the right to purchase the premises or any residual value guarantees. The Company does not have any related party leases. During both the thirteen and thirty-nine weeks ended September 24, 2025 and September 25, 2024, the Company did no t record any non-cash impairment charges. See Note 1, “Basis of Presentation and Summary of Significant Accounting Policies – Impairment of Property and Equipment and ROU Assets” for additional information. Equipment Leases of equipment primarily consist of restaurant equipment, copiers and vehicles. These leases are fixed payments with no variable component. Additionally, no optional renewal periods have been included in the calculation of the ROU asset, and there are no residual value guarantees and no restrictions imposed. 21 Table of Contents Lease Cost and Lease Activities The following table presents the Company’s total lease cost, disaggregated by underlying asset (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Thirteen Weeks Ended ​ September 24, 2025 ​ September 25, 2024 ​ Property Equipment ​ ​ ​ Property ​ Equipment ​ ​ ​ ​ ​ Leases ​ Leases ​ Total ​ Leases ​ Leases ​ Total Finance lease cost: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortization of right-of-use assets ​ $ 19 ​ $ 27 ​ $ 46 ​ $ 18 ​ $ 25 ​ $ 43 Interest on lease liabilities ​ ​ 9 ​ ​ 4 ​ ​ 13 ​ ​ 8 ​ ​ 6 ​ ​ 14 Operating lease cost: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fixed rent cost ​ ​ 7,295 ​ ​ 101 ​ ​ 7,396 ​ ​ 7,012 ​ ​ 70 ​ ​ 7,082 Short-term lease cost ​ — ​ 9 ​ 9 ​ — ​ 1 ​ 1 Variable lease cost ​ 142 ​ 389 ​ 531 ​ 164 ​ 308 ​ 472 Sublease income ​ ( 1,730 ) ​ — ​ ( 1,730 ) ​ ( 1,817 ) ​ — ​ ( 1,817 ) Total lease cost ​ $ 5,735 ​ $ 530 ​ $ 6,265 ​ $ 5,385 ​ $ 410 ​ $ 5,795 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Thirty-Nine Weeks Ended ​ ​ September 24, 2025 ​ September 25, 2024 ​ Property Equipment ​ ​ Property Equipment ​ ​ ​ ​ Leases ​ Leases ​ Total ​ Leases ​ Leases ​ Total Finance lease cost: ​ ​ ​ ​ ​ ​ ​ ​ Amortization of right-of-use assets ​ $ 57 ​ $ 86 ​ $ 143 ​ $ 56 ​ $ 73 ​ $ 129 Interest on lease liabilities ​ ​ 28 ​ ​ 13 ​ 41 ​ 27 ​ ​ 14 ​ 41 Operating lease cost: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fixed rent cost ​ ​ 21,692 ​ 309 ​ 22,001 ​ 21,220 ​ 222 ​ 21,442 Short-term lease cost ​ — ​ 44 ​ 44 ​ — ​ 2 ​ 2 Variable lease cost ​ 444 ​ 1,059 ​ 1,503 ​ 448 ​ 1,001 ​ 1,449 Sublease income ​ ( 5,193 ) ​ — ​ ( 5,193 ) ​ ( 5,354 ) ​ — ​ ( 5,354 ) Total lease cost ​ $ 17,028 ​ $ 1,511 ​ $ 18,539 ​ $ 16,397 ​ $ 1,312 ​ $ 17,709 The following table presents the Company’s total lease cost on the condensed consolidated statements of income (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Thirteen Weeks Ended ​ ​ Thirty-Nine Weeks Ended ​ September 24, 2025 September 25, 2024 ​ September 24, 2025 September 25, 2024 Lease cost – Occupancy and other operating expenses ​ $ 5,992 ​ $ 5,662 ​ ​ $ 17,927 ​ $ 17,228 Lease cost – General & administrative ​ 214 ​ ​ 76 ​ ​ 428 ​ ​ 311 Lease cost – Depreciation and amortization ​ 46 ​ ​ 43 ​ ​ 143 ​ ​ 129 Lease cost – Interest expense ​ 13 ​ ​ 14 ​ ​ 41 ​ ​ 41 Total lease cost ​ $ 6,265 ​ $ 5,795 ​ ​ $ 18,539 ​ $ 17,709 ​ 22 Table of Contents During the thirty-nine weeks ended September 24, 2025 and September 25, 2024, the Company had the following cash and non-cash activities associated with its leases (dollars in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Thirty-Nine Weeks Ended September 24, 2025 ​ Thirty-Nine Weeks Ended September 25, 2024 ​ ​ Property ​ Equipment ​ ​ ​ Property Equipment ​ ​ ​ ​ Leases ​ Leases ​ Total ​ Leases ​ Leases ​ Total Cash paid for amounts included in the measurement of lease liabilities ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating cash flows used for operating leases ​ $ 21,732 ​ $ 279 $ 22,011 ​ $ 21,202 ​ $ 210 ​ $ 21,412 Financing cash flows used for finance leases ​ $ 70 ​ $ 98 $ 168 ​ $ 70 ​ $ 83 ​ $ 153 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Non-cash investing and financing activities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating lease ROU assets obtained in exchange for lease liabilities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating lease ROU assets ​ $ 14,369 ​ $ 15 $ 14,384 ​ $ 11,457 ​ $ 1,286 ​ $ 12,743 Finance lease ROU assets obtained in exchange for lease liabilities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Finance lease ROU assets ​ $ — ​ $ — ​ $ — ​ $ — ​ $ 69 ​ $ 69 Derecognition of ROU assets due to terminations, impairment or modifications ​ $ 415 ​ $ — $ 415 ​ $ — ​ $ — ​ $ — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other Information ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-average remaining years in lease term—finance leases ​ 15.13 ​ 2.80 ​ ​ ​ ​ 16.13 ​ ​ 2.92 ​ ​ ​ Weighted-average remaining years in lease term—operating leases ​ 9.71 ​ 3.05 ​ ​ ​ ​ 10.12 ​ ​ 4.00 ​ ​ ​ Weighted-average discount rate—finance leases ​ 2.57 % 7.07 % ​ ​ ​ 2.57 % ​ 6.37 % ​ ​ Weighted-average discount rate—operating leases ​ 5.41 % 6.72 % ​ ​ ​ 5.21 % ​ 6.71 % ​ ​ ​ Information regarding the Company’s minimum future lease obligations as of September 24, 2025 is as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Finance Leases ​ Operating Leases ​ Minimum Minimum Minimum ​ ​ Lease ​ Lease ​ Sublease For the Years Ending ​ Payments ​ Payments ​ Income December 31, 2025 ​ $ 55 ​ $ 7,344 ​ $ 1,225 December 30, 2026 ​ 191 ​ 27,023 ​ 4,912 December 29, 2027 ​ 180 ​ 30,233 ​ 4,925 December 27, 2028 ​ 134 ​ 27,315 ​ 4,718 December 26, 2029 ​ 118 ​ 25,074 ​ 4,179 Thereafter ​ 1,274 ​ 131,706 ​ 23,573 Total ​ $ 1,952 ​ $ 248,695 ​ $ 43,532 Less: imputed interest ( 2.57 % - 7.07 %) ​ ( 326 ) ​ ( 58,980 ) ​ Present value of lease obligations ​ 1,626 ​ 189,715 ​ Less: current maturities ​ ( 152 ) ​ ( 17,060 ) ​ Noncurrent portion ​ $ 1,474 ​ $ 172,655 ​ ​ Short-Term Leases The Company has multiple short-term leases, which have terms of less than 12 months, and thus were excluded from the recognition requirements of Topic 842. The Company has recognized these lease payments in its condensed consolidated statements of income on a straight-line basis over the lease term and variable lease payments in the period in which the obligation for those payments was incurred. Lessor The Company is a lessor for certain property, facilities and equipment owned by the Company and leased to others, principally franchisees, under non-cancelable leases with initial terms ranging from three to 20 years . These lease agreements generally provide for a fixed base rent and, in some instances, contingent rent based on a percentage of gross operating profit or net revenues. All leases are considered operating leases. 23 Table of Contents For the leases in which the Company is the lessor, there are options to extend the lease. However, there are no terms and conditions to terminate the lease, no right to purchase premises and no residual value guarantees. Additionally, there are no related party leases. The Company received $ 0.1 million of lease income from company-owned locations for both the thirteen weeks ended September 24, 2025 and September 25, 2024. The Company received $ 0.3 million of lease income from company-owned locations for both the thirty-nine weeks ended September 24, 2025 and September 25, 2024. ​ 13. SHAREHOLDER RIGHTS AGREEMENT On August 8, 2023, the Board declared a dividend of one preferred share purchase right (a “Right”) for each share of common stock, par value $ 0.01 per share, of the Company (the “Common Shares”) outstanding on August 8, 2023 to the stockholders of record on that date. In connection with the distribution of the Rights, the Company entered into a Rights Agreement (the “Rights Agreement”), dated as of August 8, 2023, between the Company and Equiniti Trust Company, LLC, as rights agent. Each Right entitled the registered holder to purchase from the Company one one-thousandth of a share of Series A Preferred Stock, par value $ 0.01 per share, of the Company (the “Preferred Shares”) at a price of $ 53.75 per one one-thousandth of a Preferred Share represented by a Right, subject to adjustment. On August 4, 2024, the Board approved and entered into an Amendment to the Rights Agreement (together, the “Amended Rights Agreement”). Pursuant to the Amended Rights Agreement, the expiration date of the Rights was extended to May 30, 2025 11:59 p.m., Pacific Time, the date that the votes of the stockholders of the Company with respect to the Company’s 2025 annual meeting of stockholders were certified. The Amended Rights Agreement expired and was terminated by its term on May 30, 2025. ​ 14. SEGMENT REPORTING ​ Operating segments are defined as components of a company that engage in business activities from which it may earn revenue and incur expenses, and for which separate financial information is available and is regularly reviewed by the chief operating decision maker ( " CODM " ) to assess the performance of the individual segments and make decisions about company resources such as personnel and working capital to be allocated to the segments. The Company derives revenue from three primary sources: (1) company-operated restaurant revenue, (2) franchise revenue, which is comprised primarily of franchise royalties and, to a lesser extent, franchise fees and sublease rental income, and (3) franchise advertising fee revenue. All significant revenues relate to retail sales of food and beverages through either company-operated or franchised restaurants. The Company determined that it has one operating segment and one reportable segment which is reflected in the Company’s current organizational and management structure. The accounting policies of the segment are the same as those described in Note 1 “Basis of Presentation and Summary of Accounting Policies”. The Company’s CODM is the Chief Executive Officer who manages the Company’s operations on a reportable segment basis. The Company’s CODM reviews its operations and financial performance at a consolidated level by comparing actual results to budgeted figures and prior year results. This approach allows the CODM to assess whether the Company’s operating segment is meeting its financial goals, identify trends and make more informed decisions about resource allocation and performance targets. When evaluating the Company’s financial performance, the CODM regularly reviews total revenues, segment expenses and consolidated net income as reported on the Consolidated Statements of Operations as well as non-GAAP measures such as restaurant contribution margin and Adjusted EBITDA to allocate Company resources and assess the performance of the Company. Segment asset information is not used by the CODM to assess performance and allocate resources. ​ The table below is a summary of the segment net income, including significant segment expenses for the thirteen and twenty-six weeks ended September 24, 2025 and September 25, 2024 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Thirteen Weeks Ended ​ Thirty-Nine Weeks Ended ​ September 24, 2025 ​ September 25, 2024 September 24, 2025 ​ September 25, 2024 Total revenue $ 121,520 ​ $ 120,395 ​ $ 366,531 ​ $ 358,724 24 Table of Contents Less: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Food and paper costs ​ 24,879 ​ ​ 25,401 ​ ​ 75,114 ​ ​ 76,751 Labor and related expenses ​ 30,648 ​ ​ 32,744 ​ ​ 94,982 ​ ​ 96,192 General and administrative expenses ​ 12,343 ​ ​ 11,418 ​ ​ 37,138 ​ ​ 35,130 Franchise expenses ​ 11,407 ​ ​ 10,488 ​ ​ 36,476 ​ ​ 31,961 Occupancy expenses ​ 7,973 ​ ​ 7,703 ​ ​ 24,016 ​ ​ 23,071 Other operating expenses (1) ​ 18,757 ​ ​ 18,385 ​ ​ 55,128 ​ ​ 51,538 Depreciation and amortization ​ 3,973 ​ ​ 4,034 ​ ​ 11,789 ​ ​ 11,755 Other segment expenses (2) ​ 82 ​ ​ 85 ​ ​ 153 ​ ​ 192 Total operating expenses ​ 110,062 ​ ​ 110,258 ​ ​ 334,796 ​ ​ 326,590 Income from operations ​ 11,458 ​ ​ 10,137 ​ ​ 31,735 ​ ​ 32,134 Interest expenses, net ​ 1,122 ​ ​ 1,536 ​ ​ 3,505 ​ ​ 4,627 Provision for income taxes ​ 2,978 ​ ​ 2,415 ​ ​ 8,284 ​ ​ 7,776 Total segment net income $ 7,358 ​ $ 6,186 ​ $ 19,946 ​ $ 19,731 ​ (1) Other operating expenses are comprised of utilities, repairs and maintenance, advertising, credit card processing fees, delivery service provider fees, restaurant supplies and other restaurant operating costs. (2) Other segment expenses include loss on disposal of assets, gain on recovery of insurance proceeds, net, loss on disposition of restaurants, and impairment and closed-store reserves. ​ ​ ​ ​ ​ 25 Table of Contents