What changed in this filing

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Item 1. Financial Statements

2025-11-06 compared with 2025-08-08 · 202 added, 111 removed, 369 unchanged (46% of the section changed)

3 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

June 29, 2025 and March 30, 2025

September 28, 2025 and March 30, 2025

(in thousands, except share and per share amounts)

June 29, 2025

March 30, 2025

September 28,

CURRENT ASSETS

25 unchanged sentences

9,379,025 shares issued;

and 4,089,510 shares outstanding at June 29, 2025 and March 30, 2025

and 4,089,510 shares outstanding at September 28, 2025 and March 30, 2025

Additional paid-in capital

1 unchanged sentence

Stockholders’ equity before treasury stock

Treasury stock, at cost, 5,289,515 shares at June 29, 2025 and March 30, 2025

Treasury stock, at cost, 5,289,515 shares at September 28, 2025 and March 30, 2025

Total stockholders’ deficit

4 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

Thirteen weeks ended June 29, 2025 and June 30, 2024

Thirteen and Twenty-six weeks ended September 28, 2025 and September 29, 2024

(in thousands, except per share amounts)

June 29, 2025

June 30, 2024

Thirteen weeks ended

Twenty-six weeks ended

September 28,

September 29,

September 28,

September 29,

Branded Products

13 unchanged sentences

Interest expense

Loss on debt extinguishment (Note P)

Interest and dividend income

9 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS ’ DEFICIT

Thirteen weeks ended June 29, 2025 and June 30, 2024

Thirteen weeks ended September 28, 2025 and September 29, 2024

(in thousands, except share and per share amounts)

1 unchanged sentence

Stockholders’

Balance, March 30, 2025

Balance, June 29, 2025

Dividends on common stock ($ 0.50 per share)

Share-based compensation

Balance, September 28, 2025

Treasury Stock, at Cost

Stockholders’

Balance, June 30, 2024

Dividends on common stock ($ 0.50 per share)

Share-based compensation

Balance, September 29, 2024

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

Nathan ’ s Famous, Inc.

and Subsidiaries

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS ’ DEFICIT

Twenty-six weeks ended September 28, 2025 and September 29, 2024

(in thousands, except share and per share amounts)

Treasury Stock, at Cost

3 unchanged sentences

Share-based compensation

Balance, June 30, 2024

Balance, September 28, 2025

Treasury Stock, at Cost

Stockholders’

Balance, March 31, 2024

Dividends on common stock ($ 1.00 per share)

Share-based compensation

Balance, September 29, 2024

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

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Thirteen weeks ended June 29, 2025 and June 30, 2024

(in thousands, except per share amounts)

June 29, 2025

June 30, 2024

Twenty-six weeks ended September 28, 2025 and September 29, 2024

(in thousands)

September 28,

September 29,

Cash flows from operating activities:

Adjustments to reconcile net income to net cash (used in) provided by operating activities:

Adjustments to reconcile net income to net cash provided by operating activities:

Loss on debt extinguishment

Depreciation and amortization

10 unchanged sentences

Other liabilities

Net cash (used in) provided by operating activities

Net cash provided by operating activities

Cash flows from investing activities:

2 unchanged sentences

Cash flows from financing activities:

Proceeds from Credit Facility

Repayment of Credit Facility

Repayment of Senior Secured Notes

Debt issuance costs

Dividends paid to stockholders

Net cash used in financing activities

Net (decrease) increase in cash and cash equivalents

Net increase in cash and cash equivalents

Cash and cash equivalents, beginning of period

1 unchanged sentence

Cash paid during the period for:

See Note S for supplemental cash flow information.

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

2 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 29, 2025

September 28, 2025

(in thousands, except share and per share amounts)

1 unchanged sentence

The accompanying condensed consolidated financial statements of Nathan's Famous, Inc.

and subsidiaries (collectively “Nathan’s,” the “Company,” “we,” “us” or “our”) as of and for the thirteen week periods ended June 29, 2025 and June 30, 2024 have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

and subsidiaries (collectively “Nathan’s,” the “Company,” “we,” “us” or “our”) as of and for the thirteen and twenty-six week periods ended September 28, 2025 and September 29, 2024 have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

The unaudited condensed consolidated financial statements include all adjustments (consisting of normal recurring adjustments) which, in the opinion of management, are necessary for a fair presentation of financial condition, results of operations and cash flows for the periods presented.

24 unchanged sentences

The Company is currently evaluating the impact that the new guidance will have on our consolidated financial statements.

In July 2025, the FASB issued ASU 2025-05, “ Financial Instruments — Credit Losses (Topic 326):

Measurement of Credit Losses for Accounts Receivable and Contract Assets ” which provides all entities with a practical expedient to assume that current conditions as of the balance sheet date do not change for the remaining life of the assets when estimating credit losses for current accounts receivable and current contract assets.

ASU 2025-05 is effective for fiscal years beginning after December 15, 2025, which for us is our fiscal year 2027 beginning on March 30, 2026, and interim reporting periods within those annual reporting periods, with early adoption permitted.

Based on our preliminary evaluation, we do not anticipate a material effect on our consolidated financial statements.

The Company does not believe that any recently issued, but not yet effective accounting standards, when adopted, will have a material effect on the accompanying condensed consolidated financial statements.

NOTE C – REVENUES

The Company’s disaggregated revenues for the thirteen weeks ended June 29, 2025 and June 30, 2024 are as follows (in thousands):

The Company’s disaggregated revenues for the thirteen and twenty-six weeks ended September 28, 2025 and September 29, 2024 are as follows (in thousands):

Thirteen weeks ended

June 29, 2025

June 30, 2024

Twenty-six weeks ended

September 28,

September 29,

September 28,

September 29,

Branded Products

7 unchanged sentences

Thirteen weeks ended

June 29, 2025

June 30, 2024

Twenty-six weeks ended

September 28,

September 29,

September 28,

September 29,

United States

3 unchanged sentences

The following table provides information about contract liabilities from contracts with customers (in thousands):

June 29, 2025

September 28, 2025

March 30, 2025

2 unchanged sentences

“Accrued expenses and other current liabilities” (b)

Deferred franchise fees of $ 274 and $ 644 as of June 29, 2025 and $ 309 and $ 697 as of March 30, 2025 are included in Deferred franchise fees – current and long term, respectively.

Includes $ 497 of deferred license royalties and $ 250 of deferred advertising fund revenue as of June 29, 2025 and $ 892 of deferred license royalties and $ 500 of deferred advertising fund revenue as of March 30, 2025.

Deferred franchise fees of $ 250 and $ 631 as of September 28, 2025 and $ 309 and $ 697 as of March 30, 2025 are included in Deferred franchise fees – current and long term, respectively.

Includes $ 215 of deferred license royalties and $ 500 of deferred advertising fund revenue as of September 28, 2025 and $ 892 of deferred license royalties and $ 500 of deferred advertising fund revenue as of March 30, 2025.

Significant changes in deferred franchise fees are as follows (in thousands):

Thirteen weeks ended

June 29, 2025

June 30, 2024

Twenty-six weeks ended

September 28, 2025

September 29, 2024

Deferred franchise fees at beginning of period

3 unchanged sentences

Significant changes in deferred revenues are as follows (in thousands):

Thirteen weeks ended

June 29, 2025

June 30, 2024

Twenty-six weeks ended

September 28, 2025

September 29, 2024

Deferred revenues at beginning of period

6 unchanged sentences

Represents franchise fees expected to be recognized for the remainder of the 2026 fiscal year, which includes international development fees expected to be recognized over the duration of one year or less.

Amount does not include $ 128 of franchise fee revenue recognized for the thirteen weeks ended June 29, 2025.

We have applied the optional exemption, as provided for under Topic 606 “ Revenues from Contracts with Customers, ” which allows us to not disclose the transaction price allocated to unsatisfied performance obligations when the transaction price is a sales-based royalty.

Amount does not include $ 213 of franchise fee revenue recognized for the twenty-six weeks ended September 28, 2025.

We have applied the optional exemption, as provided for under ASC Topic 606 “ Revenues from Contracts with Customers ,” which allows us to not disclose the transaction price allocated to unsatisfied performance obligations when the transaction price is a sales-based royalty.

NOTE D – INCOME PER SHARE

2 unchanged sentences

Dilutive common shares used in the computation of diluted net income per common share result from the assumed exercise of stock options as determined using the treasury stock method and restricted stock unit awards.

The following chart provides a reconciliation of information used in calculating the per-share amounts for the thirteen week periods ended June 29, 2025 and June 30, 2024, respectively (in thousands, except share and per share amounts):

June 29, 2025

June 30, 2024

The following chart provides a reconciliation of information used in calculating the per-share amounts for the thirteen and twenty-six week periods ended September 28, 2025 and September 29, 2024, respectively (in thousands, except share and per share amounts):

Thirteen weeks ended

Twenty-six weeks ended

September 28,

September 29,

September 28,

September 29,

Common Stock:

7 unchanged sentences

The Company considers money market accounts and money market funds to be cash equivalents.

Cash equivalents were $ 18,885 and $ 19,400 at June 29, 2025 and March 30, 2025, respectively.

At June 29, 2025 and March 30, 2025, substantially all of the Company’s cash balances are in excess of insurance limits of the Federal Deposit Insurance Corporation, or the FDIC.

Cash equivalents were $ 24,551 and $ 19,400 at September 28, 2025 and March 30, 2025, respectively.

At September 28, 2025 and March 30, 2025, substantially all of the Company’s cash balances are in excess of insurance limits of the Federal Deposit Insurance Corporation or the FDIC.

The Company has not experienced any losses in such accounts.

10 unchanged sentences

that is, the assets and liabilities are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances, such as when evidence of impairment exists.

At June 29, 2025, no fair value adjustment or material fair value measurements were required for non-financial assets or liabilities.

At September 28, 2025, no fair value adjustment or material fair value measurements were required for non-financial assets or liabilities.

NOTE G – ACCOUNTS AND OTHER RECEIVABLES, NET

Accounts and other receivables, net, consist of the following (in thousands):

September 28,

Branded product sales

10 unchanged sentences

After the Company has used reasonable collection efforts, it writes off accounts receivable through a charge to the allowance for credit losses.

Changes in the Company’s allowance for credit losses for the thirteen week period ended June 29, 2025 and the fiscal year ended March 30, 2025 are as follows (in thousands):

Changes in the Company’s allowance for credit losses for the twenty-six week period ended September 28, 2025 and the fiscal year ended March 30, 2025 are as follows (in thousands):

September 28,

Beginning balance

4 unchanged sentences

Prepaid expenses and other current assets consist of the following (in thousands):

September 28,

Real estate taxes

7 unchanged sentences

Should the estimates and assumptions prove to be incorrect, the Company may be required to record an impairment charge in future periods and such impairment could be material.

There have been no significant events or changes in circumstances during the thirteen weeks ended June 29, 2025 that would indicate that the carrying amount of the Company’s intangible asset may be impaired as of June 29, 2025.

There have been no significant events or changes in circumstances during the thirteen and twenty-six week periods ended September 28, 2025 that would indicate that the carrying amount of the Company’s intangible asset may be impaired as of September 28, 2025.

NOTE J - LONG LIVED ASSETS

8 unchanged sentences

Should the estimates and assumptions prove to be incorrect, the Company may be required to record impairment charges in future periods and such impairments could be material.

There have been no significant events or changes in circumstances during the thirteen weeks ended June 29, 2025 that would indicate that the carrying amount of the Company’s long-lived assets may be impaired as of June 29, 2025.

There have been no significant events or changes in circumstances during the thirteen and twenty-six week periods ended September 28, 2025 that would indicate that the carrying amount of the Company’s long-lived assets may be impaired as of September 28, 2025.

NOTE K – ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities consist of the following (in thousands):

September 28,

Payroll and other benefits

4 unchanged sentences

Sales, use and other taxes

Construction costs

Dividend payable

Corporate income taxes

1 unchanged sentence

NOTE L – INCOME TAXES

The effective income tax rates for the thirteen week periods ended June 29, 2025 and June 30, 2024 were 27.2 % and 27.4 %, respectively.

The effective income tax rate for the thirteen weeks ended June 29, 2025 reflected $ 3,329 of income tax expense recorded on $ 12,257 of pre-tax income.

The effective income tax rate for the thirteen weeks ended June 30, 2024 reflected $ 3,507 of income tax expense recorded on $ 12,784 of pre-tax income.

The effective income tax rates for the thirteen week periods ended September 28, 2025 and September 29, 2024 were 26.0 % and 25.5 %, respectively.

The effective income tax rate for the thirteen weeks ended September 28, 2025 reflected $ 1,822 of income tax expense recorded on $ 7,021 of pre-tax income.

The effective income tax rate for the thirteen weeks ended September 29, 2024 reflected $ 2,069 of income tax expense recorded on $ 8,099 of pre-tax income.

The effective income tax rate for each of the twenty-six week periods ended September 28, 2025 and September 29, 2024 was 26.7 %.

The effective income tax rate for the twenty-six weeks ended September 28, 2025 reflected $ 5,151 of income tax expense recorded on $ 19,278 of pre-tax income.

The effective income tax rate for the twenty-six weeks ended September 29, 2024 reflected $ 5,576 of income tax expense recorded on $ 20,883 of pre-tax income.

The effective tax rates are higher than the United States Federal statutory rates primarily due to state and local taxes, as well as non-deductible compensation under the Internal Revenue Code Section 162(m).

The amount of unrecognized tax benefits included in Other liabilities at June 29, 2025 and March 30, 2025 was $ 579 and $ 532 , respectively, all of which would impact the Company’s effective rate, if recognized.

As of June 29, 2025 and March 30, 2025, the Company had approximately $ 428 and $ 395 , respectively, of accrued interest and penalties in connection with unrecognized tax benefits.

The amount of unrecognized tax benefits included in Other liabilities at September 28, 2025 and March 30, 2025 was $ 462 and $ 532 , respectively, all of which would impact the Company’s effective rate, if recognized.

As of September 28, 2025 and March 30, 2025, the Company had approximately $ 418 and $ 395 , respectively, of accrued interest and penalties in connection with unrecognized tax benefits.

On July 4, 2025, President Trump signed into law the One Big Beautiful Bill Act (“OBBBA”).

1 unchanged sentence

The OBBBA makes permanent key elements of the Tax Cuts and Jobs Act, including 100% bonus depreciation, and the business interest expense limitation.

ASC 740, “Income Taxes”, requires the effects of changes in tax rates and laws on deferred tax balances to be recognized in the period in which the legislation is enacted.

Consequently, as of the date of enactment, and during the three months ended September 28, 2025, the Company will evaluate all deferred tax balances under the newly enacted tax law and identify any other changes required to its financial statements as a result of the OBBBA.

The Company is still evaluating the impact of the OBBBA and the results of such evaluations will be reflected on the Company’s Form 10-Q for the quarter ended September 28, 2025.

The OBBBA did not have a material impact to our provision for income taxes for the thirteen and twenty-six weeks ended September 28, 2025.

The Company is continuing to evaluate the full year impact of the OBBBA and, based on our preliminary analysis, we do not anticipate a material effect on our consolidated financial statements for the fiscal year ending March 29, 2026.

NOTE M – SEGMENT INFORMATION

12 unchanged sentences

Revenues from operating segments are from transactions with unaffiliated third parties and do not include any intersegment revenues.

Interest expense, as well as interest and dividend income are managed centrally at the corporate level, and, accordingly, such items are not presented by segment since they are excluded from the measure of profitability reviewed by the CODM.

Interest expense, loss on debt extinguishment and interest and dividend income are managed centrally at the corporate level, and, accordingly, such items are not presented by segment since they are excluded from the measure of profitability reviewed by the CODM.

The following tables summarize segment information and reconcile our segment results to our consolidated results as reported on our Condensed Consolidated Statement of Earnings (in thousands):

June 29, 2025

Thirteen weeks ended

September 28, 2025

Cost of sales

Segment gross profit (loss)

Restaurant operating expenses (2)

Department expenses (3)

Other general and administration expenses (4)

Payroll expense

Depreciation and amortization

Advertising fund expense

Income (loss) from operations

Interest expense

Interest and dividend income

Other income, net

Income (loss) before provision for income taxes

Thirteen weeks ended

September 29, 2024

Cost of sales

Segment gross profit

5 unchanged sentences

Advertising fund expense

Income from operations

Income (loss) from operations

Interest expense

Loss on debt extinguishment

Interest and dividend income

Other income, net

Income before provision for income taxes

June 30, 2024

Income (loss) before provision for income taxes

Twenty-six weeks ended

September 28, 2025

Cost of sales

6 unchanged sentences

Advertising fund expense

Income from operations

Income (loss) from operations

Interest expense

1 unchanged sentence

Other income, net

Income before provision for income taxes

Income (loss) before provision for income taxes

Twenty-six weeks ended

September 29, 2024

Cost of sales

Segment gross profit

Restaurant operating expenses (2)

Department expenses (3)

Other general and administration expenses (4)

Payroll expense

Depreciation and amortization

Advertising fund expense

Income (loss) from operations

Interest expense

Loss on debt extinguishment

Interest and dividend income

Other income, net

Income (loss) before provision for income taxes

The significant expense categories and amounts align with segment-level information that is regularly provided to the CODM.

3 unchanged sentences

NOTE N – SHARE-BASED COMPENSATION

Total share-based compensation expense during the thirteen week periods ended June 29, 2025 and June 30, 2024 was $ 288 and $ 188 , respectively.

Total share-based compensation expense during the thirteen and twenty-six week periods ended September 28, 2025 and September 29, 2024 was $ 284 and $ 229 , and $ 572 and $ 417 , respectively.

Total share-based compensation expense is included in general and administrative expenses in our accompanying Condensed Consolidated Statements of Earnings.

As of June 29, 2025, there was $ 2,993 of unamortized compensation expense related to share-based awards.

We expect to recognize this expense over approximately thirty-three months, which represents the weighted average remaining requisite service periods for such awards.

As of September 28, 2025, there was $ 2,709 of unamortized compensation expense related to share-based awards.

We expect to recognize this expense over approximately thirty-two months, which represents the weighted average remaining requisite service periods for such awards.

The Company recognizes compensation expense for unvested share-based awards on a straight-line basis over the requisite service period.

1 unchanged sentence

Thirteen weeks ended

June 29, 2025

June 30, 2024

Twenty-six weeks ended

September 28,

September 29,

September 28,

September 29,

Stock options

Restricted stock units

Total compensation cost

Total share-based compensation expense

Stock options

There were no new share-based awards granted during the thirteen week period ended June 29, 2025.

Transactions with respect to stock options for the thirteen weeks ended June 29, 2025 are as follows:

There were no new share-based awards granted during the twenty-six week period ended September 28, 2025.

Transactions with respect to stock options for the twenty-six weeks ended September 28, 2025 are as follows :

Contractual Life

1 unchanged sentence

Options outstanding at March 30, 2025

Options outstanding at June 29, 2025

Options exercisable at June 29, 2025

Options outstanding at September 28, 2025

Options exercisable at September 28, 2025

Restricted stock units

Transactions with respect to restricted stock units for the thirteen weeks ended June 29, 2025 are as follows:

Transactions with respect to restricted stock units for the twenty-six weeks ended September 28, 2025 are as follows:

Unvested restricted stock units at March 30, 2025

Unvested restricted stock units at June 29, 2025

Unvested restricted stock units at September 28, 2025

NOTE O – STOCKHOLDERS’ EQUITY

Effective June 10, 2025, the Company’s Board of Directors (the “Board”) declared its first quarterly cash dividend of $ 0.50 per share for fiscal 2026, which was paid on July 1, 2025 to stockholders of record as of the close of business on June 23, 2025.

Effective August 8, 2025, the Board declared its second quarterly cash dividend of $ 0.50 per share for fiscal 2026 payable on September 5, 2025 to stockholders of record as of the close of business on August 25, 2025.

Effective August 8, 2025, the Board declared its second quarterly cash dividend of $ 0.50 per share for fiscal 2026, which was paid on September 5, 2025 to stockholders of record as of the close of business on August 25, 2025.

Effective November 6, 2025, the Board declared its third quarterly cash dividend of $ 0.50 per share for fiscal 2026 payable on December 5, 2025 to stockholders of record as of the close of business on November 24, 2025.

Additionally, effective November 6, 2025, the Board also declared a special cash dividend of $ 2.50 per share to stockholders of record as of close of business on November 24, 2025 of approximately $ 10,224 payable on December 5, 2025.

Our ability to pay future dividends is limited by the terms of our Credit Agreement (as defined in Note P – LONG TERM DEBT).

2 unchanged sentences

In 2016, the Board authorized increases to the sixth stock repurchase plan for the purchase of up to 1,200,000 shares of its common stock on behalf of the Company.

As of June 29, 2025, Nathan’s had repurchased 1,101,884 shares at a cost of $ 39,000 under the sixth stock repurchase plan.

At June 29, 2025 there were 98,116 shares remaining to be repurchased pursuant to the sixth stock repurchase plan.

As of September 28, 2025, Nathan’s had repurchased 1,101,884 shares at a cost of $ 39,000 under the sixth stock repurchase plan.

At September 28, 2025 there were 98,116 shares remaining to be repurchased pursuant to the sixth stock repurchase plan.

The plan does not have a set expiration date.

3 unchanged sentences

Long-term debt consists of the following (in thousands):

June 29, 2025

March 30, 2025

SOFR Term Loan Borrowings with an effective interest rate of 5.812 % and 5.825 % at June 29, 2025 and March 30, 2025, respectively.

September 28,

SOFR Term Loan Borrowings with an effective interest rate of 5.636 % and 5.825 % at September 28, 2025 and March 30, 2025, respectively.

unamortized debt issuance costs

2 unchanged sentences

Long-term debt, net

The Company’s mandatory debt principal repayments as of June 29, 2025 were as follows (in thousands):

The Company’s mandatory debt principal repayments as of September 28, 2025 were as follows (in thousands):

Remainder of 2026

Total debt repayments through 2030 exceed the total carrying amount of the Company’s debt as of June 29, 2025 because the carrying amount reflects the unamortized portion of debt issuance costs.

Total debt repayments through 2030 exceed the total carrying amount of the Company’s debt as of September 28, 2025 because the carrying amount reflects the unamortized portion of debt issuance costs.

On July 10, 2024 (the “Effective Date”), the Company entered into a five-year unsecured Credit Agreement (the “Credit Agreement”) among the Company, as borrower, direct and indirect subsidiaries of the Company, as guarantors, the lenders from time to time party thereto (the “Lenders”) and Citibank, N.A., as administrative agent, swing line lender, L/C issuer and a Lender (capitalized terms used and not otherwise defined herein shall have the meanings set forth in the Credit Agreement).

4 unchanged sentences

The Company will use any Revolving Loan borrowings under the Credit Agreement for working capital and general corporate purposes.

As of June 29, 2025, there were no outstanding borrowings under the Revolving Loan.

Term Loan and Revolving Loan borrowings under the Credit Agreement bear interest at a rate per annum, at the Company’s option, of (a) for Base Rate Loans, the Base Rate plus the Applicable Rate of 0.00 % or (b) for Term SOFR Loans, Term SOFR plus the Applicable Rate of 1.40 % for one (1), three (3) or six (6) month periods, as selected by the Company in its Loan Notice.

As of September 28, 2025, there were no outstanding borrowings under the Revolving Loan.

In connection with the refinancing, the Company recorded a loss on extinguishment of debt of $ 334 during the quarter ending September 29, 2024 that reflected the write-off of the remainder of the debt issuance costs on the Company’s 6.625% Secured Notes due 2025.

Additionally, in connection with the refinancing, the Company incurred $ 431 of debt issuance costs on the Term Loan borrowings that were capitalized and will be amortized over the term of the Credit Agreement.

Term Loan and Revolving Loan borrowings under the Credit Agreement will bear interest at a rate per annum, at the Company’s option, of (a) for Base Rate Loans, the Base Rate plus the Applicable Rate of 0.00 % or (b) for Term SOFR Loans, Term SOFR plus the Applicable Rate of 1.40 % for one (1), three (3) or six (6) month periods, as selected by the Company in its Loan Notice.

The Company is subject to a commitment fee of 0.20 % per annum on the daily amount of the undrawn portion of the Revolving Committed Amount.

The interest rate on the Term Loan borrowings at June 29, 2025 was 5.812 %.

The interest rate on the Term Loan borrowings at September 28, 2025 was 5.636 %.

The Credit Agreement contains customary affirmative covenants and negative covenants and requires the Company to maintain a Consolidated Fixed Charge Ratio not to exceed 1.20 to 1.00 and a Consolidated Net Leverage Ratio not to exceed 3.00 to 1.00, in each case, as of the end of each fiscal quarter.

The Company was in compliance with the covenants of the Credit Agreement at June 29, 2025.

The outstanding Term Loan borrowings under the Credit Agreement are payable in equal quarterly installments of 1.0 % of the original principal amount of the Term Loan, or $ 600 , beginning September 30, 2024, with the balance payable on the final maturity date.

The Company was in compliance with the covenants of the Credit Agreement at September 28, 2025.

The outstanding Term Loan borrowings under the Credit Agreement are payable in equal quarterly installments of 1.0 % of the original principal amount of the Term Loan, or $ 600 , which began on September 30, 2024, with the balance payable on the final maturity date.

The Company made mandatory principal repayments on the Term Loan of $ 1,200 during fiscal 2026.

Subsequent to the quarter ending June 29, 2025, on June 30, 2025, the Company paid its next quarterly mandatory debt principal repayment of $ 600 .

Subsequent to the quarter ending September 28, 2025, on September 30, 2025, the Company paid its next quarterly mandatory debt principal repayment of $ 600 .

The outstanding Term Loan borrowings and the Revolving Loan borrowings under the Credit Agreement are voluntarily prepayable by the Company without penalty or premium, provided, that each of the following shall require a mandatory prepayment of outstanding Term Loan borrowings and Revolving Loan borrowings by the Company as follows:

4 unchanged sentences

NOTE Q – LEASES

The Company is party as lessee to various leases for its Company-owned restaurants and lessee/sublessor to one franchised location property, including land and buildings, as well as leases for its corporate office and certain office equipment.

The Company is party as lessee to various leases for land, buildings and certain office equipment for its Company-owned restaurants and corporate office, as well as a lessee/sublessor to one other property.

Company as lessee

The components of the net lease cost for the thirteen week periods ended June 29, 2025 and June 30, 2024 were as follows (in thousands):

The components of the net lease cost for the thirteen and twenty-six week periods ended September 28, 2025 and September 29, 2024 were as follows (in thousands):

Thirteen weeks ended

June 29, 2025

June 30, 2024

Twenty-six weeks ended

September 28,

September 29,

September 28,

September 29,

Operating lease cost

2 unchanged sentences

Total net lease cost

The components of the net lease cost are included in the Condensed Consolidated Statement of Earnings for the thirteen week periods ended June 29, 2025 and June 30, 2024 as follows (in thousands):

The components of the net lease cost are included in the Condensed Consolidated Statements of Earnings for the thirteen and twenty-six week periods ended September 28, 2025 and September 29, 2024 as follows (in thousands):

Thirteen weeks ended

June 29, 2025

June 30, 2024

Twenty-six weeks ended

September 28, 2025

September 29, 2024

September 28, 2025

September 29, 2024

Restaurant operating expenses

2 unchanged sentences

Total net lease cost

Cash paid for amounts included in the measurement of lease liabilities for the thirteen week periods ended June 29, 2025 and June 30, 2024 were as follows (in thousands):

Cash paid for amounts included in the measurement of lease liabilities for the thirteen and twenty-six week periods ended September 28, 2025 and September 29, 2024 were as follows (in thousands):

Thirteen weeks ended

June 29, 2025

June 30, 2024

Twenty-six weeks ended

September 28,

September 29,

September 28,

September 29,

Operating cash flows from operating leases

The weighted average remaining lease term and weighted average discount rate for operating leases as of June 29, 2025 were as follows:

The weighted average remaining lease term and weighted average discount rate for operating leases as of September 28, 2025 were as follows:

Weighted average remaining lease term (years):

Weighted average discount rate:

Future lease commitments to be paid and received by the Company as of June 29, 2025 were as follows (in thousands):

Future lease commitments to be paid and received by the Company as of September 28, 2025 were as follows (in thousands):

Operating Leases

3 unchanged sentences

Represents future lease commitments to be paid and received by the Company for the remainder of the 2026 fiscal year.

Amount does not include $ 471 of lease commitments paid and received by the Company for the thirteen week period ended June 29, 2025.

Amount does not include $ 920 of lease commitments paid and received by the Company for the twenty-six week period ended September 28, 2025.

The present value of minimum operating lease payments of $ 1,933 and $ 2,631 are included in “Current portion of operating lease liabilities” and “Long-term portion of operating lease liabilities,” respectively on the Condensed Consolidated Balance Sheet.

Company as lessor

The components of lease income for the thirteen week periods ended June 29, 2025 and June 30, 2024 were as follows (in thousands):

The components of net lease income for the thirteen and twenty-six week periods ended September 28, 2025 and September 29, 2024 were as follows (in thousands):

Thirteen weeks ended

June 29, 2025

June 30, 2024

Twenty-six weeks ended

September 28,

September 29,

September 28,

September 29,

Operating lease income, net

5 unchanged sentences

An unfavorable ruling could include money damages and, in such event, could result in a material adverse impact on the Company’s results of operations for the period in which the ruling occurs.

NOTE S – SUPPLEMENTAL CASH FLOW INFORMATION

Non-cash investing activities

Accruals for purchases of property and equipment of $ 52 are included in Accrued expenses and other current liabilities on the Condensed Consolidated Balance Sheet at June 29, 2025.

Non-cash financing activities

Dividends declared but not yet paid of $ 2,045 are included in Accrued expenses and other current liabilities on the Condensed Consolidated Balance Sheet at June 29, 2025.

NOTE T – SUBSEQUENT EVENTS

NOTE S – SUBSEQUENT EVENTS

The Company evaluated subsequent events through the date the condensed consolidated financial statements were issued and filed with the SEC.

1 unchanged sentence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements